Credit Card Solution

Skimming is the act of obtaining credit card information from the cardholder unlawfully and using the information to carry out unauthorized transactions. Typically, the details are fraudulently obtained by an employee of a business by using simple methods, such as extracting the credit card information with swiping devices or photocopiers. Large quantities of credit card numbers can be copied by using more advanced electronic ‘skimmer’ devices. Once the thief has skimmed the cardholder’s card, they can transfer the details onto a fake card and use this forgery to make purchases as if it was the original. This fraudulent act is normally carried out in businesses such as pubs or restaurants, where the credit card would typically be taken out of cardholder’s sight.

A case in 2008 in Virginia found the culprit, Nicole Ward, guilty of credit card skimming at a Cheesecake Factory franchise. She copied customers’ credit cards using an electronic device and even moved to recruit two other servers in the store who would receive bonus payments for every card number copied. This is where her plan became unstuck, as the two servers worked closely with local law enforcement officers to bring this fraudulent act to justice. Ward faces a 30-year jail sentence for her part in this credit card skimming racket.

Other known techniques of credit card skimming include attaching a device to the slot of an ATM, which reads each unknowing cardholder’s details from the magnetic strip as they withdraw cash. At the same time, a small camera also reads the PIN as it’s entered, allowing the offender to obtain everything they need to successfully withdraw funds from the victim’s account.

Detection of credit card skimming is difficult for the average cardholder, but through the cooperation of police and card issuers, the culprit can usually be narrowed down very quickly. Most affected cardholders in a certain area, after all, will be found to have visited one particular ATM, store location, or pub within the time frame in question, making it easier for the police to narrow their search and identify the problem. There are severe penalties for merchants who fail to safeguard their payment facilities from fraud, penalties which can range from large fines to being disallowed to use credit card facilities at all. In this electronic age, being unable to accept credit cards could be the end of many businesses, because of the huge reliance on electronic payments, and therefore the onus is on the merchant to be vigilant.

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