Cognitive Computing- 5 Challenges this Emerging Technology is Suffering

Credit card fraud has many shapes and forms. The purpose of doing credit card fraud also varies. Some frauds are done in order to perform a huge transaction and some are done to purchase expensive goods for free. Any financial institution is exposed to a large number of attacks that are performed through credit cards. 30% of credit card fraud are recorded in businesses and financial sectors. Many e-commerce companies face great loss due to credit card fraud.

There are different techniques of credit card fraud that are adopted by fraudsters to perform malicious activities.

Following are the 8 most common types of credit card fraud;
Stolen and lost credit card fraud

In this fraud, the card is either stolen or lost. The thief then use that card for his good. Although stolen and lost cards cannot be used in the machine but it can be used in order to make online purchases. The way to avoid such transactions is to report the bank as soon as possible to reject the request asked from that credit card.

Application credit card fraud

This fraud happens when someone has requested the bank for new credit card issuance. The identity is first stolen by the thief and then use that identity to write an application. Thieves take help from the supporting documents which make it possible for them to write an application through which they substantiate the application. In such cases, banks often call the applicant to identify the identity, which can also be forged by the thief.
There are many ways to investigate the true owner, although these ways are time to time forged by the fraudsters and vice versa.

Card Not Present (CNP) fraud

If someone has stolen or knows the expiry date and account number of your card, they can perform CNP fraud against you. This can be done through the mail, phone or internet. Some merchants need verification code which is of form xxx. A fraudster can apply all possible combinations while performing small transactions and can get the number.

Fake credit card fraud

Although creating fake credit cards is much hard. There is a magnetic stripe, a chip or in some cases hologram associated with each credit card and to forge it a difficult task. A fraudster having all that information can do this.

Assumed Identity

A fraudster uses a temporary address and false name to obtain a credit card. In many cases, banks keep a checklist in which they acquire a passport or driving license for verification purposes. This fraud is hard to do, but a determined criminal can do this.
Stolen ID fraud

This fraud is done by the person who knows your card number and password. He can perform a huge transaction from it or issue a new card from this. This is the hardest fraud when it comes to recovering it. Many times, this fraud is revealed when the transaction is already done.
Counterfeit fraud

An accurate copy of the card is created by fraudsters by having all the required information. He swipes it on the machine to perform a transaction.