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Credit Cards Frauds on the Rise

credit cards picture at doitinvest.comThe recent financial crisis has some interesting effects too. As you are just reading this investment blog, a thief could use somewhere in the world a counterfeit credit card with your full name printed on it.
He or she could have got it quite easy – you handed your credit card to a store clerk or a waiter for a swipe. And they did an extra swipe with it. Instead of only charging your card, that person passed your details through a machine caled “skimmer”. That machine takes the information out of a credit card and sends it to a database.
“Once this information has been downloaded into a skimmer it can be downloaded into a computer and e-mailed anywhere in the world,” says a spokeman for the U.S. Secret Service.
Skiming of the credit cards is a fast-growing global problem, especially with the current financial crisis. Skiming creates losses of more than $1 billion a year, and databases with credit cards information for sale proliferate over the internet.
The global industry of credit card counterfeiting is well organised. A Far East cards factory can produce and ship overnight up to 5,000 cloned cards. Those cards are as goo as the original one and, until the bank blocks them, they are valid.
Smaller skimmers, roughly the size of a pager, hit the scene two or three years ago. These skimmers are easy to carry, easy to hide and easy to buy – including from the internet. The cost for one skimmer is $300, whereas the cloning machine does not cost more than $10,000. Money which the thieves can recoup in just one day, with the right cloned credit cards.
But banks are not standing still either. The new POS (point-of-sale) terminals cannot be bugged (attached with a skimmer). Banks try to avoid portable terminals, whereby the waiter can take your card right at the table.
And behind the scenes, armies of bank employees try to prevent such fraud. A few weeks ago a bank clerk called one of our teammates at and asked hime whether he visited Germany a few days ago. When he said no, the bank blocked the card immediately and announced him that it was cloned.
Why are the banks taking these measures? Easy – because you, as a U.S. consumer, must not pay more than $50 if a card is lost or stolen (according to the U.S. Truth in Lending Act). So they must (in most cases) reimburse all those falsely charged expenses back to you.
But there are some other simple measures you can take against credit card fraud. You could watch the terminals where your credit card is passed through. And you could watch carefully your credit card expenses in the account statement, notifying the bank for anything unusual.
If your card is yet skimmed, the first thing you should do is to call your bank and ask them to put your fraud alert on your account. You could even go so far as to sign off a police report, which is sure to be followed upon. And above all, we at beg you to be careful with that valuable piece of plastic.

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