Credit Card Fraud in the USA Research Paper Example | Topics and Well Written Essays - 1750 words

faith Card impostor in the USA - Research Paper ExampleThe onus falls on the merchants to pay for the reference work bait fraud and if it lacks in proper insurance, they have to incur the chargeback fee as well. The US is piteous towards a cashless society but credit rally theft has become a major vex of retailers, consumers, credit card issuers and the law enforcement agencies (Hearn, 1986). Credit cards were introduced in the 1950s and since then fraudsters have been determination ways to attack the system (Byrne, 2010). According to The Survey of Consumer Payment Choice, there were 176.8 million credit card holders in 2008 and the average cardholder has 3.5 credit cards (Woolsey & Schulz, 2011). Credit cards represent the majority of the total $315 zillion US financial fraud loss in 2005 while according to a European training more than than 22 million adults were victims to credit card fraud in 2006 (Conlin, 2007). According to the 2009 LexisNexis True hail of Fraud St udy, retailers lose $100bn a year to consumer-facing fraud. Twenty-four percent of all retailers, 43% of whom have a strong online presence, reported increase in losings through credit card fraud. Most card fraud allowance losses were borne by the card issuers (59%) followed by the merchants (41%), says Sullivan (2010). In 2006 the total fraud losses were estimated at $3.718bn as per table provided below Source Sullivan (2010). The process for approving card payments depends to a hulking extent on information. The criminals have an incentive to steal this information and this leads to attacks on computers, data breaches and ultimately payment fraud. Card fraud is the highest in the United States than countries such as UK, Spain and Netherlands. Better technology in the payment approval system gouge help combat fraud to some extent. Online payment approval permits automated checks against wider sets of information such as the cardholders zip code or transaction history (Sullivan , 2010). Criminals assembly such information and use it to commit fraud. Criminals steal wallets, intercept mail and get access to estimate statements, or even spy and gather information when the card is in use. Video cameras secretly primed(p) can capture valuable information. Phishing and hacking are other modes through which criminals gather information to conduct fraud. Credit and charge card fraud cost cardholders and issuers millions of dollars each year. Earlier the fraud used to occur oer the telephone when the fraudster posed as an organization representative and offered incentives in exchange for credit card information. stealth is the most common form of fraud but people can also use the card number without the knowledge of the owner of the card (FTC, 2009). The thief eyes the trash to collect discarded expediency or carbons through which it is possible to obtain the credit card number. Others ways in which fraud can occur is when dishonest clerks make an extra imprin t and use the card details to make individualised charges. Now the criminals use packet-sniffing programs on the Internet and steal credit card information electronically. The largest case in the US credit card fraud history took place in 2008 when Albert Gonzalez and his team attacked TJX and other companies (Byrne, 2010). They acquired more than 130 million debit and credit card numbers and stole tens of millions of dollars. These were basically of customers of 7-eleven and other retail giants.