Skimming: The Latest Threat To Your Credit Card

By Author: Alisdair Cosgrove
Total Articles: 184
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The problem of credit card skimming now accounts for international losses of over one billion dollars a year.This credit card scam is common in Latin America as well as Europe and Asia, however it is starting to be seen in the United States.

When purchases are made in a store it is easy to run this type of credit card scam when you give your card to a store employee.That store employee may be swiping your card with a small machine known as a skimmer as well as using it to pay for your purchase and this skimmer takes your information from your card and stores it in this machine's system.The skimmer is equipped to hold information on hundreds of credit cards and from this information, the crooks are able to produce counterfeit cards.There are skimming rings working all over the world and once your information is put into the skimmer, it is then downloaded into a computer, ready to be emailed to anyone worldwide.

It was not as easy to commit this fraud in the past, as the skimmers were very large machines that had to be hidden under the check-out counter.The advances in technology in the past ten years, has made them ...
... able to streamline the skimmer, making it small enough to be hand-held and out of sight of the unwary customer.These skimmers are easy to buy; they can be purchased over the internet at around $300, but the machine needed to make counterfeit credit cards is a much larger investment - costing $5,000 to $10,000.

There is another form of skimming done by placing a skimmer bug into the credit card terminals and then retrieving it later with credit card information on it.Only the older terminals can be violated in this way and with the onset of new credit card terminals, this has alleviated much of this bugging.

After the credit card information thieves have all the pertinent facts from you they will start to shop for the things they want and charge it to your credit card number.Online shopping has become more and more popular and this is the reason why so much of the credit card fraud is taking place over the internet.The way the information skimming thieves will check the credit card for it's validity is to make several purchases of low cost items on internet websites to find out if the cards are active.

The merchant who had the employee who did the skimming may be the real victim of this crime, but the cardholder is also a victim in that they are responsible for up to fifty dollars of the total amount charged on their card.The merchant is held 100% responsible and risks losing the merchandise, and is responsible for paying the fees of the investigation. Investigation fees paid by consumers and businesses recently amounted to an estimated half-billion dollars in annual revenue for credit card companies; this money is used by the card companies to offset costs to investigate charge back claims by their customers.

Those who do this type of scam operation know that a purchase of at least $2000 must be made before a criminal investigation can begin.
Alisdair Cosgrove has been writing finance articles for many years and can find more of his work at the UK site CreditCardsWeb.co.uk, offering credit card offers for UK residents and also a great selection of balance transfers. Visit today to read more of Alisdair's great credit card articles including what are interest free credit cards