Choosing Student Credit Card

FRAUD TYPES
Many banks, Issuers and Acquirers have fraud detection systems that highlight suspicious transaction activity on a cardholder accounts or at a merchant premises. The banks can then take the necessary actions to investigate the transactions and confirm with the genuine cardholder if the transactions were made by them or if fraud has occurred. However, it may be the case the first notification that there might be fraud on a Visa account is when the cardholder contacts his/her credit card issuer to dispute a charge on their Visa account. The cardholder informs the credit card issuer that they did not authorise nor did they participate in the transaction in question.

Credit Score - The FICO Score

CROSS BORDER FRAUD
In many cases the credit card issuer and the acquiring bank are located in different countries. Tracking this fraud activity requires more involved efforts as the information usually resides outside the country (jurisdiction) of the fraud activity. An example of this would be when thieves in one country intercept the credit cards in the mail or when the criminal obtains account information from a collusive merchant, and sends the stolen credit cards or information to accomplices in a second country. The fraud would then take place in the second country. This necessitates gathering information from two different banks in two different countries and dealing with law enforcement from another country, which may not have the same legislation regarding fraudulent use of credit cards.

TYPES OF FRAUD
credit card fraud can be perpetrated in a number of ways. In the majority of instances, the issuing banks are the victims. The first indication that there may be fraud on an account maybe when the cardholder disputes the transaction with the bank. After review of the material available on the transaction, and once the bank has received an affidavit from the cardholder and is satisfied that the cardholder had no part in the fraud, the cardholder will not be held responsible for the fraud or the losses. The issuing bank thus has funded the transaction and has no recourse other than to “write” the losses off—that is, absorb the losses from the bank's profits. Once the issuing bank has ascertained that in fact fraud has occurred, it is their responsibility to report the fraud to Visa International. Visa tracks credit card fraud by various types. The most common are: Lost Stolen Stolen out of the mails (NRI) Fraudulent application Counterfeit Fraudulent Use of Account Number Miscellaneous There are other ways that credit card fraud can be committed, but for tracking purposes, these are the primary types of fraud. Visa International for several reasons requires fraud reporting. Analysis of the fraud activity assists in detecting trends and aberrations in normal patterns of activity. The analysis of the fraud information also allows coordination of actions with member banks and law enforcement to reduce the fraud activity. Often law enforcement agencies might be interested in the fraud activity in particular cities or at specific merchants, as other types of fraud activity may be occurring at these same locations.

Credit Bureaus

Lost/Stolen Credit Cards
Lost and stolen credit cards are reported as two different types by the issuing banks. Both are difficult to prevent as the cardholder is being robbed in one instance or the cardholder has lost their credit card and is not aware until the next time they try to use it. Traditionally, about 40% of the fraud losses reported by Visa issuers are due to fraud activity on lost and stolen credit cards. Visa strongly recommends that cardholders be made aware of the need to report credit cards that are lost or stolen as soon as they become aware of the fact. The average run time for a lost or stolen credit card is about five days. That means the bank was not advised as soon as the theft occurred and the thief had five days to use the credit card. credit cards stolen from the person, residence, hotel, automobile or place of business do not have a high resale value because it is assumed the loss will be reported right away. Muggers, burglars, pickpockets, purse snatchers and prostitutes in the course of their normal criminal activities come into possession of credit cards and they either know where they can dispose of the credit cards for quick money or use the credit cards themselves, often with a collusive merchant. An advantage of credit cards stolen in this manner is the fact that other identification is usually stolen at the same time, permitting the thief to more easily assume the identity of the legitimate cardholder.

Credit Cards Stolen from the Mails --Not Received Items (NRI)
credit cards stolen from the mail accounts for approximately 3% of the fraud reported by issuers. In some countries the term for this fraud is Not Received Items (NRI), from the fact that the item in the mail was not received by the person to whom it was sent. With over 1 Billion Visa credit cards in circulation, there are a large number of credit cards sent in the mails daily. Add to the Visa credit cards all the other credit cards and the number becomes even greater. Over the years there have been a number of examples of credit cards stolen from the mails. Dishonest postal employees, individuals removing mailed credit cards from the post boxes, changing of addresses of legitimate recipients, hijacking of mail vehicles. Mailboxes in apartment blocks are favourite targets for credit card thieves. Issuers have used more sophisticated delivery methods, and in many instances, the credit cards are mailed in an “inactive” mode and must be activated before use. The legitimate cardholder is required to contact the issuing bank and provide information only the cardholder and the bank should know—a password. Some banks even have gone to the point of placing the cardholders photograph on the credit card. As a security measure, credit card issuers may announce the credit card's impending arrival with a “pre-mailer”, which advises the cardholder that a credit card should be in the mail shortly. Also, a “post-mailer” is used to advise a cardholder that the credit card should have arrived and if it has not, to call the issuer immediately. Criminals will pay extra for credit cards stolen from the mail as they are unsigned. The illegitimate user of such a credit card can sign the credit card himself. Naturally, he will sign the name of the legitimate cardholder but he can sign it in such a manner, even if he is cautious enough to disguise his own handwriting characteristics, that he can easily duplicate the signature each time he uses the credit card.

Credit Bureaus Information

Fraudulent Applications
Fraudulent application fraud is particularly disconcerting to cardholders as this fraud occurs by obtaining a bankcard through misrepresentation of information provided to the issuer on the application. Use of a true name or the credit history of an unsuspecting individual, with a false address on the application is a common way to obtain a credit card through subterfuge. While the financial victim may be the bank, the individual whose name and credit history has been used may find it very difficult to rectify the damage done to his name and credit history. The criminal element puts a higher value on credit cards obtained this way because, unlike stolen credit cards, they are not signed.
Credit Card Not Present -- Mail Order / Telephone Order (MO/TO)
The most easily to commit fraud involves mail order and telephone order sales. The credit card has made it possible to shop anywhere in the world while never leaving home. For the merchant, this is a very risky business, as there is neither credit card nor cardholder present, nor is there a signature to be compared. Because of this, it is rather easy for the thief to commit this type of fraud.

Counterfeit/Altered Credit Card
A counterfeit credit card is one that is illegally manufactured. It is embossed and may have the magnetic stripe encoded with appropriate information from a legitimate credit card, which had been electronically compromised. An altered credit card is a genuine credit card manufactured by a certified printer but which has one or more features changed by mechanical or electronic means. Counterfeit credit cards are of grave concern to issuers and law enforcement agencies because of the much higher dollar losses involved.

A HISTORY OF COUNTERFEITING CREDIT CARDS FRAUD
Criminals are always looking for ways to exploit financial systems, particularly credit cards. In the early 1980s it was relatively easy to counterfeit credit cards in a low-tech manner. “Shave and paste”, punching, re-embossing, and silk screen printing were the methods by which even the unsophisticated crook could use to counterfeit credit cards.
Early schemes

Choosing CRA for Credit Report

“Shave and paste” was nothing more than carefully shaving the embossed account numbers off the plastic with a sharp razor blade. The numbers were then rearranged to match a good account number. “Punching” was a process that required the crook to use a paper hole punch in order to punch each number out from the plastic credit card. By carefully placing the punched numbers in the holes in the plastic to match a good account number, the credit card could then be imprinted on a sales draft.
Re-embossing
Re-embossing is a method of placing a good account number on a stolen or lost credit card. First the criminal had to flatten out the credit card. Once the credit card was flattened, the good account number could then be embossed over the flattened number.
Traditional credit card Counterfeit
credit cards are made with polyvinyl chloride plastic (PVC) and the exact composition from each PVC manufacture and/or batch will vary. Thus, examination of the counterfeit plastic composition by a forensic chemist can be useful in specific cases. Analysis between various credit cards and known samples can determine the source of the plastic and if credit cards in question have a similar composition. Additionally, forensic examination of a credit card's printin g, embossing and inks can also be useful in determining relationships between credit cards in question.

Magnetic Stripe Counterfeit
In the late 1980s, the crooks began to encode account information onto the magnetic stripe. Counterfeit credit cards were manufactured with magnetic stripes to accommodate the crooks ability to use the stripe. The industry took measures to prevent the fraudulent use of the credit cards by encoding the magnetic stripe by using special codes with the legitimate account numbers. Realizing that the industry was moving to the magnetic stripe for authorization purposes, the thieves began to encode counterfeit credit cards, as well as lost and stolen credit cards, with legitimate information. The merchant would simply swipe the credit card through the terminal to obtain an authorisation. The clerk did not compare the account number on the face of the credit card to that account number that was displayed on the terminal once the credit card was swiped. Had the clerk done so he/she would have realized the difference in the account numbers and realized the credit card was a fraudulent credit card, either “altered” or counterfeit. Encoding counterfeit credit cards with magnetic stripes, as well as re-encoding lost and stolen credit cards, for fraudulent purposes grew rapidly. Losses attributed to this type of counterfeit rose quickly. The thieves realized the value of the encoding devices, which were being used by other industries, such as hospitals and universities. These devices were easy to obtain, either legitimately or by theft from legitimate users. The industry began experience an increase in the number of counterfeit credit cards with information encoded on the magnetic stripe.

Credit Card Verification Value (CVV)
To counter the threat of encoded counterfeit credit cards, the industry, led by Visa in 1989, began to encode special information, CVV, on the magnetic stripe. This special information consists of unique, Issuer defined confidential, three-digit “check number” encoded on the magnetic stripe of all valid credit cards. The number is based on the account number; expiration date and service code, and is calculated

Credit card debt help