Check Resolution Services Inc

Check Resolution Services Inc

News   •   Nov 08, 2010 09:31 EST

About Check Resolution Services

Card not present transaction

The mail and the Internet are major routes for fraud against merchants who sell and ship products, and impacts legitimate mail-order and Internet merchants. If the card is not physically present (called CNP, card not present) the merchant must rely on the holder (or someone purporting to be so) presenting the information indirectly, whether by mail, telephone or over the Internet. While there are safeguards to this, it is still more risky than presenting in person, and indeed card issuers tend to charge a greater transaction rate for CNP, because of the greater risk.

It is difficult for a merchant to verify that the actual cardholder is indeed authorising the purchase. Shipping companies can guarantee delivery to a location, but they are not required to check identification and they are usually not involved in processing payments for the merchandise. A common recent preventive measure for merchants is to allow shipment only to an address approved by the cardholder, and merchant banking systems offer simple methods of verifying this information. Before this and similar countermeasures were introduced, mail order carding was rampant as early as 1992[6]. A carder would obtain the credit card information for a local resident and then intercept delivery of the illegitimately purchased merchandise at the shipping address, often by staking out the porch of the residence.

Small transactions generally undergo less scrutiny, and are less likely to be investigated by either the card issuer or the merchant. CNP merchants must take extra precaution against fraud exposure and associated losses, and they pay higher rates for the privilege of accepting cards. Fraudsters bet on the fact that many fraud prevention features are not used for small transactions.

Merchant associations have developed some prevention measures, such as single use card numbers, but these have not met with much success. Customers expect to be able to use their credit card without any hassles, and have little incentive to pursue additional security due to laws limiting customer liability in the event of fraud. Merchants can implement these prevention measures but risk losing business if the customer chooses not to use the measures.

Identity theft

Identity theft can be divided into two broad categories: Application fraud and account takeover.

Application fraud

Application fraud happens when a criminal uses stolen or fake documents to open an account in someone else's name. Criminals may try to steal documents such as utility bills and bank statements to build up useful personal information. Or they may create counterfeit documents.

Account takeover

Account takeover happens when a criminal tries to take over another person's account, first by gathering information about the intended victim, then contacting their card issuer masquerading as the genuine cardholder, and asking for mail to be redirected to a new address. The criminal then reports the card lost and asks for a replacement to be sent.

Some merchants added a new practice to protect their consumers and their own reputation, where they ask the buyer to send a photocopy of the physical card and statement to ensure the legitimate usage of a card.

Check Resolution Services Improve :Credit card companies
To prevent being "charged back" for fraud transactions merchants can sign up for services offered by Visa and MasterCard called Verified by Visa and MasterCard SecureCode, under the umbrella term 3-D Secure. This requires consumers to add additional information to confirm a transaction.

Often enough online merchants do not take adequate measures to protect their websites from fraud attacks, for example by being blind to sequencing. In contrast to more automated product transactions, a clerk overseeing "card present" authorization requests must approve the customer's removal of the goods from the premise in real time.

Credit card merchant associations, like Visa and MasterCard, receive profits from transaction fees, charging between 0% and 3.25% of the purchase price plus a per transaction fee of between 0.00 USD and 40.00 USD. Cash costs more to bank up, so it is worthwhile for merchants to take cards. Issuers are thus motivated to pursue policies which increase the money transferred by their systems. Many merchants believe this pursuit of revenue reduces the incentive for credit card issuers to adopt procedures to reduce crime, particularly because the cost of investigating a fraud is usually higher than the cost of just writing it off.[citation needed] But in the US and Australia credit card issuers do not take these costs; they are passed on to the merchants as "chargebacks". This can results in substantial additional costs: not only has the merchant been defrauded for the amount of the transaction, he is also obliged to pay the chargeback fee, and to add insult to injury the transaction fees still stand.

Merchants have started to request changes in state and federal laws to protect themselves and their consumers from fraud, but the credit card industry has opposed many of the requests. In many cases, merchants have little ability to fight fraud, and must simply accept a proportion of fraud as a cost of doing business.

Because all card-accepting merchants and card-carrying customers are bound by civil contract law there are few criminal laws covering the fraud.[citation needed] Payment transfer associations enact changes to regulations, and the three parties— the issuer, the consumer, and the merchant— are all generally bound to the conditions, by a self-acceptance term in the contract that it can be changed.

About Check Resolution Services

Carding

Carding is a term used for a process to verify the validity of stolen card data. The thief presents the card information on a website that has real-time transaction processing. If the card is processed successfully, the thief knows that the card is still good. The specific item purchased is immaterial, and the thief does not need to purchase an actual product; a Web site subscription or charitable donation would be sufficient. The purchase is usually for a small monetary amount, both to avoid using the card's credit limit, and also to avoid attracting the card issuer's attention. A website known to be susceptible to carding is known as a cardable website.

In the past, carders used computer programs called "generators" to produce a sequence of credit card numbers, and then test them to see which were valid accounts. Another variation would be to take false card numbers to a location that does not immediately process card numbers, such as a trade show or special event. However, this process is no longer viable due to widespread requirement by Internet credit card processing systems for additional data such as the billing address, the 3 to 4 digit Card Security Code and/or the card's expiration date, as well as the more prevalent use of wireless card scanners that can process transactions right away. Nowadays, carding is more typically used to verify credit card data obtained directly from the victims by skimming or phishing.

A set of credit card details that has been verified in this way is known in fraud circles as a phish. A carder will typically sell data files of the phish to other individuals who will carry out the actual fraud. Market price for a phish ranges from US$1.00 to US$50.00 depending on the type of card, freshness of the data and credit status of the victim.

Compromised accounts

Card account information is stored in a number of formats. Account numbers are often embossed or imprinted on the card, and a magnetic stripe on the back contains the data in machine readable format. Fields can vary, but the most common include:

* Name of card holder
* Account number
* Expiration date
* Verification/CVV code

Check Resolution Services Info : Cardholder liability

In the US, federal law limits the liability of card holders to $50 in the event of theft of the actual credit card, regardless of the amount charged on the card, if reported within 60 days of receiving the statement. In practice many issuers will waive this small payment and simply remove the fraudulent charges from the customer's account if the customer signs an affidavit confirming that the charges are indeed fraudulent. If the physical card is not lost or stolen, but rather just the credit card account number itself is stolen, then Federal Law guarantees card holders have zero liability to the credit card issuer.

About Check Resolution Services Skimming

Skimming is the theft of credit card information used in an otherwise legitimate transaction. It is typically an "inside job" by a dishonest employee of a legitimate merchant. The thief can procure a victim’s credit card number using basic methods such as photocopying receipts or more advanced methods such as using a small electronic device (skimmer) to swipe and store hundreds of victims’ credit card numbers. Common scenarios for skimming are restaurants or bars where the skimmer has possession of the victim's credit card out of their immediate view. The thief may also use a small keypad to unobtrusively transcribe the 3 or 4 digit Card Security Code which is not present on the magnetic strip.

Instances of skimming have been reported where the perpetrator has put a device over the card slot of a ATM (automated teller machine), which reads the magnetic strip as the user unknowingly passes their card through it. These devices are often used in conjunction with a pinhole camera to read the user's PIN at the same time. This method is being used very frequently in Europe, e.g. in the Netherlands.[citation needed] Another technique used is a keypad overlay that matches up with the buttons of the legitimate keypad below it and presses them when operated, but records or transmits the keylog of the PIN number entered by wireless. The device or group of devices illicitly installed on an ATM are also colloquially known as a "skimmer". Recently-made ATMs now often run a picture of what the slot and keypad are supposed to look like as a background, so that consumers can identify foreign devices attached.

Skimming is difficult for the typical cardholder to detect, but given a large enough sample, it is fairly easy for the card issuer to detect. The issuer collects a list of all the cardholders who have complained about fraudulent transactions, and then uses data mining to discover relationships among them and the merchants they use. For example, if many of the cardholders use a particular merchant, that merchant can be directly investigated. Sophisticated algorithms can also search for patterns of fraud. Merchants must ensure the physical security of their terminals, and penalties for merchants can be severe if they are compromised, ranging from large fines by the issuer to complete exclusion from the system, which can be a death blow to businesses such as restaurants where credit card transactions are the norm.

Check Resolution Services Secure Carding

Carding is a term used for a process to verify the validity of stolen card data. The thief presents the card information on a website that has real-time transaction processing. If the card is processed successfully, the thief knows that the card is still good. The specific item purchased is immaterial, and the thief does not need to purchase an actual product; a Web site subscription or charitable donation would be sufficient. The purchase is usually for a small monetary amount, both to avoid using the card's credit limit, and also to avoid attracting the card issuer's attention. A website known to be susceptible to carding is known as a cardable website.

In the past, carders used computer programs called "generators" to produce a sequence of credit card numbers, and then test them to see which were valid accounts. Another variation would be to take false card numbers to a location that does not immediately process card numbers, such as a trade show or special event. However, this process is no longer viable due to widespread requirement by Internet credit card processing systems for additional data such as the billing address, the 3 to 4 digit Card Security Code and/or the card's expiration date, as well as the more prevalent use of wireless card scanners that can process transactions right away. Nowadays, carding is more typically used to verify credit card data obtained directly from the victims by skimming or phishing.

A set of credit card details that has been verified in this way is known in fraud circles as a phish. A carder will typically sell data files of the phish to other individuals who will carry out the actual fraud. Market price for a phish ranges from US$1.00 to US$50.00 depending on the type of card, freshness of the data and credit status of the victim.

More results:
Check Resolution Services Protects Check Resolution Services Contact Check Resolution Services Safe