Archive for the ‘Credit card fraud’ Category
The district attorney in Manhattan indicted 27 people for running a crime ring out of Brooklyn, N.Y. which bought Apple products with stolen credit card information and then resold them at a profit.
The credit card forgery and identity theft ring, known as “S3,” purchased and resold Apple products all over the country, beginning in June 2008. The group purchased the credit information from online data traffickers, including names and credit card account numbers. With a shared e-mail account, they used the information to create counterfeit credit cards, which were used to buy merchandise at Apple retail stores.
Items purchased included iPods, MacBooks, iPads and gift cards. The items were purchased in Apple store locations in New York, Florida, Wisconsin, New Jersey, Connecticut, Alabama, Oregon, Indiana, Georgia, Nevada, Pennsylvania, Virginia and the District of Columbia.
The products were sold for cash at below-retail prices to people in Brooklyn known as “fences,” who then resold the goods for a profit.
The group’s leader was Shaheed Bilal, who was serving time in Rikers Island on unrelated charges. Despite being incarcerated, he continued to lead S3 with the assistance of his girlfriend, Ophelia Alleyne. He was released from prison in December 2010, and continued to purchase, receive and share stolen credit card information.
Bilal’s brothers, Ali and Rahim, are accused of recruiting shoppers to buy the products at the stores.
Charges against all those involved include grand larceny, conspiracy and criminal possession of a forged instrument. Investigators seized $300,000 in cash and bank holdings from the ring at the time of arrest.
Eight people have been arrested in Cleveland, Ohio for their involvement in an identity theft ring headed up by a man already behind bars.
Andre Reese, 37; Jeffery McClain, 39; Kevin McBride, 34; Michael Sailes, 51; Edwin Peavy, 52; Daniel Ashford, 37; James L. Wiggins, 47; and Jay Williams, 27, have all pleaded guilty to charges relating to an identity theft ring headed up by Dimorio McDowell, 34, of Atlanta, Ga. McDowell’s current sentence expires in 2014, at which time he will begin serving the 14-year sentence for this case.
Federal prosecutors say McDowell was able to get personal information communicated to him while in prison, including names, addresses and Social Security numbers of credit card holders who were customers at various department stores. He would then contact the stores and add additional users to the accounts, or open new accounts in the person’s name.
McDowell worked with the newly-arrested crew, which used the fraudulent cards to purchase $254,000 in merchandise.
Consumers have to be careful with their credit and debit cards when shopping in public. Make sure to keep your credit card in sight at all times. If a clerk takes your card to swipe it for the purchase, ask him or her to do so in your presence. If they refuse, pay in cash or don’t make the purchase.
Why is this important? Crooked clerks take the card out of your sight in order to not only scan the card for your purchase, but also to run the card through a skimmer, an electronic device that records the information found on the magnetic strip on the back of the card. The information can be collected on the skimmer and later downloaded so that a thief can use it to commit crimes or sell it on the Internet for a profit.
If you are using a debit card for your purchases and are asked to input your PIN number, be aware of your surroundings. Make sure no one is standing too close to you, and cover your hand as you punch in the numbers. Take a good look at the machine also, and make sure hasn’t been tampered with. Crooks can attach skimmers to debit card readers as well.
Does all this seem a bit paranoid? In the eyes of some people, perhaps. But if you want to protect yourself from identity theft, isn’t it better to err on the side of a little paranoia?
In the wake of scams on Craigslist and eBay in which people send in money for products which they never receive and then try in vain to get in touch with the person who posted the ad or product, a new scam has emerged.
This new scam targets those who have been victimized in this way by sending e-mails offering a reverse e-mail lookup. The ads read: “Tired of receiving e-mails from an unknown e-mail address? Are they threatening in tone? Has someone on Craigslist or EBay taken your hard-earned money and quit responding to your e-mails? Are you ready to find out who they are? You can find out in just a couple of minutes.”
The ad is always accompanied by a link, which the recipient is invited to click on in order to conduct a reverse e-mail lookup. Most offer the lookup at a modest price, but there are a few that claim to be free as well.
The free ones are the ones to watch out for. While they may claim to be free, you’ll find that at some point during the transaction, you’ll be asked to pay for the service.
One of the biggest problems with these sites is that very often, there is no guarantee that you’ll get all of the information you’re looking for. Some of the information that is typically given is the full name of the owner of the e-mail address, current address, marital status, telephone number and criminal background records. Most of the time, only a portion of the information is there, and you’ll be asked to pay in order to get the rest of the details.
Scammers also use these types of sites in order to get consumers to enter their own personal information. You’ll be asked to input your own information, including credit card numbers, in order to proceed with the transaction. If it’s a scam site, you’ll get no information about the owner of the e-mail…instead, you’ll become a victim of identity theft.
If you decide to use a reverse lookup service, be sure you use one that is secure and that you are comfortable with. Look for “https” in the URL, instead of just “http.” A legitimate company should also have a money back guarantee, so that if you’re not satisfied with the information you receive, you can get your money back.
The safest way to handle e-mails that are unsolicited is to delete them and report them to the Federal Trade Commission. Copy the URL prior to deletion and send it via e-mail to the FTC, but don’t open the e-mail or click on any links contained within it.
Better safe than sorry.
A pair of university students have been linked to an identity theft ring based in Vietnam.
Winona (Minn.) State University officials say federal agents are investigating a pair of foreign exchange students. The ID theft ring uses stolen identities to steal millions of dollars from retailers. Neither student has been charged to date, but investigators say they have probable cause linking both students to crimes of wire fraud, identity theft and money laundering.
Investigators also claim the students collected nearly $1.25 million in illicit funds by controlling more than 180 eBay accounts and more than 360 PayPal accounts. No one at the university has been linked to the ring or charged, and it is unclear whether the students used university-issued computers in the crimes. Both students lived off campus.
The investigation was conducted by the U.S. Department of Homeland Security, and was dubbed “Operation eMule.” According to investigators, numerous major companies have been stung in this scam, including eBay, PayPal, Amazon, Apple, Dell and Verizon Wireless.
The scam works like this: stolen identities are used to open accounts with eBay, PayPal and U.S. banks. Through these accounts, the thieves sell popular, expensive merchandise at discounted prices. The sellers fill the orders by purchasing the goods from other vendors using stolen financial accounts. When the identity theft victim protests the charges, the merchants end up getting the short end of the stick.
The two students, Tram Vo and Khoi Van, have F1 visas that allow them to study in the United States, but they’re not allowed to work outside of that restriction.
The university is also conducting its own investigation, and the outcome will determine whether there are any disciplinary actions taken against Vo and Van, and whether the university will make changes to its current student conduct code.
After the presents have been unwrapped and the less-than-desirable gifts have been returned, be sure to comb through your credit card and bank statements. You could uncover a few purchases you never actually made.
Consumers should be looking for transactions that are theirs and making sure that receipts match up following the holiday rush and last minute shopping. If you do find something that’s unusual or out of place, report it immediately. Victims of identity theft typically have 60 days to file a fraud claim with their credit card company or bank. Often times, by the time you receive your statement, it’s already 10 days old, so it’s important to act quickly.
To avoid credit card fraud, be sure to carry your cards separately from your wallet, just in case your wallet is stolen. Keep a record of the account numbers, expiration dates and the phone number and address of each company in a secure place. When making a purchase, keep an eye on your card and get it back as soon as possible.
Be sure to void incorrect receipts, and destroy carbons. Save receipts to compare with billing statements. Open bills promptly and reconcile accounts monthly, just as you would your checking account.
Never lend your cards to anyone, and don’t leave cards or receipts lying around. Don’t ever sign a blank receipt, and when you sign one, make sure to draw a line through the blank space above the total. You should never write your account number on the outside of an envelope, and never give your account number out over the telephone unless you initiated the call or are sure of the person at the other end.
Remember that once you report the loss or theft of your card, you have no further responsibility for unauthorized charges. Your maximum liability under federal law is $50 per card. If you suspect fraud, you may be asked to sign a statement under oath that you did not make the purchases in question.
You should also report the theft to the Federal Trade Commission. You can do so by going online at www.ftc.gov, or by calling toll free, 1-877-FTC-HELP.
In the world of credit card fraud, there are a few urban legends that need to be passed along to provide some insight for consumers into the psychology of this type of fraud.
• The “secret” to ditching debt…this legend involves racking up a ton of debt, then wiping out that debt by sending all your creditors $10 checks bearing the notation, “Paid in Full.” This is nothing more than wishful thinking. It is possible to settle with your creditors if your debt has gotten out of hand, but the creditor would have to approve the terms first, and you must prove your financial hardship. And remember: this shows up on your credit report.
• The creditor from hell…A man gets a new credit card, and begins receiving statements showing that he owes $0. He throws them away, but he soon begins receiving threatening letters, threatening to close his account if he doesn’t pay the balance. When he finally wrote the check and sent it in, the credit card company notified him that the check had bounced, and sent the debt to collections. Of course, there’s no truth to this one. But checking your statements regularly and thoroughly is advisable.
• Osama bin Laden is a principal owner of Citibank. If you want to help America, cut up your Citibank cards and cut him off. This is not true, but it works because people are both patriotic and in need of a power trip. They want to feel like they’re in control of something. The lesson here is that you can’t make decisions regarding your credit or finances based on untrue rumors or speculation. You do have power over your spending and credit decisions, but you must do the research before you make a move.
• The sneaky credit card scam…A friend goes to the gym and leaves his belongings in a locker. But a few weeks later, he gets a credit card bill for a whopping $14,000. A thief broke into his locker, stole his credit card, and replaced it with a duplicate card that had already expired. The guy is now fit, but stuck with all that debt. The lesson here is that we must all be cautious with our personal information and credit cards. Many credit card issuers have theft protections in place. You should get familiar with what those guidelines are with your cards.
• There is a magical super card for the rich…This is is a doozy. American Express has a secret “Black Card” for the very wealthy, which is available only by invitation. It can be used to buy anything, and is delivered with a security guard. The truth? AE does have what’s called a “Centurian Card,” which is black and has an annual fee of $2,500 and offers many perks. But it’s not the magical card of legend. The lesson is that whether you have a lot of money or a little, you have to learn how to manage your money. You must have a system in place. This is a much better use of time than waiting for a magical card to be delivered by a guard.
So remember: the next time you get an e-mail about some outlandish money, credit card or identity theft urban legend, be sure you check it out before you pass it on. Don’t take any of this stuff too seriously – instead, use it as a reminder to manage your finances wisely.
Patrons at a restaurant in Tallahassee, Fla., both local and those passing through, have become victims of credit card fraud.
The computer system at Julie’s Place, a familiar dining spot for many years in Tallahassee, was hacked from outside the system and credit card information from restaurant patrons was re-routed to an unknown person over the Internet. The information was being used around the country to purchase goods.
Restaurant management is working with security software personnel to find the breach and stop it, and new security software has been installed to prevent this type of breach from re-occurring.
Local banks have issued new credit cards to customers who may have been compromised, The theft has resulted in the loss of more than $200,000.
More than 100 new cases of credit card fraud have been reported in the Tallahassee area within the past month.
Restaurant owners can combat data breaches by using a point of sale vendor with PCI-compliant hardware and software. Security should be maintained by limiting wireless access to the office computer in the restaurant, and up-to-date anti-virus and spyware software should be installed. All staff who have access to the computers should be familiar with the latest security updates.
The investigation is ongoing.
While preventing this type of breach isn’t something the average Joe can do, you can protect your personal information by regularly checking your credit card statements. Look for charges that are bogus, and contact your credit card issuer immediately to notify the issuer of the fraudulent charges. Close the credit card and ask for a new one to be issued. You should also report any fraudulent charges to the police and obtain a copy of the police report for your records.
To take a proactive stance against credit card fraud, call LifeLock today. LifeLock monitors for both credit and non-credit related threats to your personal information, and notifies you the moment any such threat is located.
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