Carding – Still Top of The Pops for Fraudsters

ElitePersonalFinance
Last Update: February 5, 2021 Identity Theft

Carding is the act of taking credit card information from an unsuspecting victim and using it to make unauthorized purchases or selling it to other criminals who are willing to pay for a stolen card. This is not really a new crime, but the way criminals commit fraud has changed over the years, as advancing technology has introduced new ways to commit crimes.

Americans are a prime target for credit card fraud. For identity thieves, this looks like the large and most lucrative market. People often have more than one credit or debit card. They have relatively large amounts or limits on their cards. Many American retailers have not yet switched over to the chip-and-pin technology, so most cards may contain only a magnetic chip, which is very easy for scammers to copy.

How Does Carding Work?

  • Carding often happens when hackers have access to a store’s credit card processing system and obtain a list of recently used cards to make a purchase. Hacker then sells the list of cards to a carder thief who uses the stolen information to buy gift cards, which are then used to buy high-end items such as cell phones, TV sets, and computers. Purchasing those goods doesn’t require registration and can be sold again later.
  • In the past, scammers would search through someone’s mailbox or trash can for discarded bank or credit card statements. Today, they can rely on digital devices such as card skimmers to steal clients’ information when they use ATM facilities.
  • Criminals are sometimes able to hack bank institutions to steal customer’s data.
  • Fraudsters have even been known to call hotel room numbers and pose as hotel employees by asking guests to confirm their credit card numbers.
  • The physical theft of your card is also considered to be carding.
  • Some thieves are genuine store employees just out to make a quick buck by selling your card info to scammers. They pretend that your card will not go through at the first attempt, offer to “clean” the magnetic chip and rub it quickly on their sleeves. Attached to the sleeve is a small device in the form of an armband, which you would not necessarily notice, that reads all your data when the card is wiped over it. If your card does not go through on the first try, take the card back and try again. Do not allow anyone to rub your card.

In effect, anywhere you pay by card can be at risk. It could be any store, a restaurant, or even using the ATM. To avoid being a victim of scammers, be careful about the person you are paying or the device you are using, particularly at the ATM, which might have been modified with a card skimmer. If something looks unusual at the ATM, then do not use it.

How Can You Protect Yourself from Carding?

Most credit card companies offer clients protection from charges if their card is reported stolen. Banks and online payment systems often use their own security measures or those produced by other specialist security companies. However, because the cards are often canceled quickly after being reported lost or stolen, scammers move rapidly to purchase before the card is stopped. The danger lies in the fact that it might be a while before you realize the card is missing.

Here are actions you can take to prevent your card from being cloned or stolen:

  • Do not write your credit or debit card number anywhere.
  • Never share your account details with anyone unless you know they are legitimate. If a stranger calls and asks for your details, no matter what the reason is – it is surely a scam!
  • Let your card company know if you move house to ensure that any mail is sent to the correct address.
  • Carry your cards separate from your wallet or purse, as these are the things targeted should there be a smash and grab. If your cards are not in those items, you will save yourself a mountain of trouble.
  • Keep your receipts later to compare them with the items on your bill. Query any discrepancies with the bank.
  • Never sign a blank receipt, and most important of all – never let your card out of your sight when paying, not even for a few moments. A few seconds is actually all that is needed to clone a card.
  • Immediately report the loss or theft of a card to your company. Most have a 24-hour service that will cancel cards and prevent unauthorized use.

Carding Forum

A carding forum is a website (usually on Deepnet or Darknet) dedicated to sharing stolen credit card information. It may also include a discussion board where members share techniques to obtain credit card details.

These forums are used by criminals who want to use stolen credit card details to make purchases and advertise their willingness to buy stolen card numbers.

Sadly, ordinary people often use these forums to obtain card information by nefarious means and make money selling the details to fraudsters. However, the card thief needs to ensure that the card is still valid for the card to be used for fraudulent purposes. This can be done on the carding forum.

If the victim has become quickly aware that their card is missing and immediately puts in a cancellation request, the card would be worthless to the thief – as it would be if there were insufficient funds to make a big purchase.

Conclusion

The arrival of chip-and-pin cards, and the continually improving electronic fraud preventative measures, have made it more difficult to use stolen card information. Most point-of-sale terminals now require an electronic approval response.

Only about 70% of US stores have switched over to the more secure chip-and-pin system, leaving the magnetic-strip-only card somewhat more vulnerable to fraud.

Credit card fraud in the US amounts to approximately $190 million per year, and cloning is just one of many tactics they use to steal your money.

Although the banks offer some protection, it is your responsibility to protect yourself from cloners and carders at the end of the day.

Remember to never let your card out of your sight! This will at the very least give you a fighting chance against card fraud.

Read also our credit card fraud guide.

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