Credit Card Fraud
Now a days everyone has a credit card. Most people have multiple credits cards. With the rise of people paying with plastic everywhere they go, there will be a rise in credit card fraud. Through the years thieves have come up with many ways to steal credit cards and charge hundreds of dollars before anyone even knows what happened. They use many techniques such as mail and Internet order fraud, account takeover, skimming and carding. In total, credit card fraud cost card holders and issuers over 500 million a year. In the long run everyone pays for this through increased prices to pay off the credit and charge fraud.(1)
Mail and Internet fraud is where the highest number of fraud cases happen. Everyone pays with credit cards online and if someone steals your card they can easily order hundreds of dollars of products online. The Internet also makes it much easier to use stolen cards because you don't have to prove the card is yours. It is nearly impossible for a merchant to verify you own the card without actually being there to check the card and your ID. Also carriers such as ups and FedEx don't check your ID to see if it matched the credit card. A preventions made by merchants have been single card use numbers, but it didn't work as well as thought and if merchants impose anymore preventions they could be losing business because of it.
There are two types of fraud that are categorized with identity theft. One being account takeover and the other being application fraud. Account takeover fraud involves a thief calling the bank and trying to get the account address changed so all the mail goes to a new address. Application fraud involves someone impersonating you to open an account under your name. Some merchants have added some prevention to this buy having the buyer send a copy of the physical card and a statement to be allowed to use the card.
Skimming fraud is a high risk to because someone can steal your card numbers and...