What is credit card abuse

There are two kinds of card abuse or fraud, card-present fraud (not so common nowadays) and card not present fraud. The compromise can occur in a number of ways and can usually occur without the knowledge of the cardholder. Using the credit card number without possession of the actual card is also a form of credit card abuse. Stealing a person’s identity in order to receive a credit card is another more threatening form of credit card abuse.

One of the earliest ways of committing credit card abuse was either by stealing the card from someone’s wallet or by “dumpster diving” for carbon copies of credit card receipts. The use of these two methods have decreased with the advent of electronic processing of credit cards. One of the simplest ways to obtain a person’s account information or actual credit card is through postal theft. 

Any person who steals mail may now have access to someone’s personal information, including credit card account numbers, credit limits, and banking information. Another type of credit card fraud is the counterfeiting of credit cards. Criminals have been able to use technology, with relative ease, to produce fraudulent versions of existing credit cards. The magnetic strips contain all the information a fraudster needs: names, account numbers, credit limits, plus other identifying information. 

If someone’s credit card is lost or stolen and it is reported, then the customer is not responsible for any fraudulent charges. Fraudsters also use technology to create fictitious cards. Fictitious cards are more advantageous because there is no person truly responsible for the account. Many financial institutions benefited from the creation of security features meant to deter fraud such as holograms and chips. However, as consumers embraced shopping by mail, over the telephone, and via the Internet, fraud increased exponentially.

Peter M

Travel Blog Writer