16 Sep 2014
KXAN reported this month that an Austin man had been arrested and accused of using stolen credit card information from victims in other countries. Police say he utilized the information to make purchases totaling thousands of dollars at stores in Austin. But just how can a stranger get your credit card information, and how is that person able to use it?
There are numerous methods of obtaining someone else’s credit card information. One way is through the use of a “skimming” device that accesses the info at a gas station, store, or other location, and hijacks your debit card or credit card. All the information needed is contained on the magnetic strip on the card.
The Austin story is just a small example of what can happen. On a larger scale, the latest credit card debacle involves a massive breach at Home Depot. The Home Depot issued followed similar breaches at Target, P.F. Chang, and even Goodwill stores. All of the thefts were made easier by the existence of the magnetic strips, which are apparently simple to clone. As a result, retailers, banks and credit card companies are under pressure to replace the strips with microchips. The microchips offer far better fraud protection, by taking your data, and converting it into a one-time, unique, encrypted signature. The experts tell us that the digital signature is very difficult to duplicate, at least compared with the ease of cloning the current generation of credit cards.
Getting back to the Austin man who stands accused of using stolen credit card information on a relatively small basis, you might assume that once the fraud was detected, it might be pretty easy to catch the thief. Well, not so, at least in this case. Even though the police were notified of the fraud by overseas banks a year ago, making the arrest took a long time. And this despite having the alleged thief’s picture from security cameras, and despite the man presenting his own Texas driver’s license as identification at some of the stores.
The “target” date for the new (microchip) cards is October 2015, but Visa and MasterCard are urging merchants to adopt the new system now, well ahead of the deadline.
Law Office of David D. White, PLLC
1201 Rio Grande Street #200
Austin, TX 78701
(512) 369-3737