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A Fact

Contrary to popular misinformation, credit card purchasing done online CAN be (if done correctly) safer and in some cases more secure than credit card purchases made in a store or restaurant.

WHY?

Online vendors are under intense pressure from card companies to use advanced security technologies to prevent credit card fraud and to prevent theft of private data. Fines range from $15\per transaction to upwards of $50,000 (fifty-thousand) per month. Whereas as I will illustrate below, retail merchants are not under the same pressure to prevent theft of card numbers.

Misinformation often stems from the sensational cases of card number theft online from lax vendors, whereas very little information is released about the level of theft that occurs REGULARLY in retail use.

FTC

According to the United States Federal Trade Commission (www.ftc.gov), the majority of credit card theft and fraud takes place in actual stores, restaurants and other business locations, not on the internet as some media have been reporting. (the media will publish and broadcast ANY shocking story, even twist the truth, so that they can sell more newspapers, magazines and increase their TV ratings.)

FTC Statistics

Three top methods of theft account for the majority of credit card fraud, offline and online:

• A thief goes through trash to find discarded receipts or carbons, and then uses your account numbers illegally.

• A dishonest clerk makes an extra imprint from your credit or charge card and uses it to make personal charges.

• You respond to a mailing asking you to call a long distance number for a free trip or bargain-priced travel package. You're told you must join a travel club first and you're asked for your account number so you can be billed. The catch! Charges you didn't make are added to your bill, and you never get your trip.

Television Documentary

Recently, the Discovery Channel TV Network ran a show about credit card fraud. This show detailed how criminal organizations go about stealing credit cards using sophisticated electronic handheld devices in conjunction with free email and free webhosting services. According to Interpol and the FBI, this is the prevailing method of credit card theft today, and the law enforcement agencies cannot stop it.

According to this television show:

1. The crime organization sends personel to major cities around the world who take jobs in restaurants.

2. These waiters/waitresses/bartenders have a handheld device, about 2" x 4", that they use to scan unsuspecting customers' credit cards. The mini scanner has a memory that records the credit card number and all other personal information stored in the card's magnetic strip.

3. Every few hours the thief goes outside and downloads the scanned data into a laptop of an accomplice. The accomplice then emails the scanned data to other accomplices in another country or uses FTP to upload the data to a free hosting web server where his accomplices can download the data.

4. Within 2-3 hours after uploading the credit card scans of the customers' credit cards, a new card is made and sold on the black market in a foreign country.

Because these criminals are using free email services and free hosting services in foreign countries, law enforcement agencies cannot easily arrest them. The free email and hosting services they use are practically untraceable. (one of the reasons most online merchants do not accept free email addresses for registrations)

Relief

The information written here is not intended to alarm you or cause you to be unnecessarily worried. The intention is only to make you aware of the fact that credit card shopping online is safer than the use of a credit card offline in a store or a restaurant.

The media, TV and other influences on society make it seem like our world is by and large a criminal world. This is very far from the truth. The vast majority of people on Earth are honest and good hearted. The number of criminal individuals is between 10 and 15%. Only about 2 1/2 % are truly destructive and this small percentage wreak so much havoc that it can at times seem like the whole world has gone bad.

By all means, continue to shop online and offline using credit cards. Just follow the guidelines for credit card use as recommended by your card's provider and the FTC. see:

A Consumer's Guide to E-Payments

IFCC - Internet Fraud Control Center

The Internet Fraud Complaint Center (IFCC) is a partnership between the Federal Bureau of Investigation (FBI) and the National White Collar Crime Center (NW3C). IFCC's mission is to address fraud committed over the Internet.

Get up to date warnings, file a complaint or report fraudulant activites at the IFCC website.