December 2012 Issue

The 'Newsletter on Financial Fraud' from CustomerXPs is your monthly insight into the various new fraud types and methods used by fraudsters globally in the banking space.

This will help you stay abreast of all the latest happenings in the banking fraud space.

Woman Uses Dead Aunt's ID in Bank Fraud Scheme


A Jersey City, N.J. woman admitted stealing the ID of her dead aunt to access her credit card and deposit accounts causing three banks to use more than $30,000.

The Method:

According to the documents filed for the case, the woman used her aunt's Social Security Number (SSN) and other personal identifying information to fraudulently add herself to her aunt's credit accounts at Bank of America and JPMorgan Chase and to open up a deposit account at Bank of America.

She contacted Bank of America and JPMorgan Chase by phone and claimed to be the aunt, providing personal identifying information. She then added herself to her aunt's credit card accounts as an authorized signer and used the cards.

She also admitted that she used the debit card to access her aunt's Provident Bank account without authorization. The woman made large purchases on the credit cards, which she did not pay off, and withdrew all of the funds from her aunt's bank accounts with Provident Bank.

The scheme caused Bank of America, JPMorgan Chase, and Provident Bank to lose more than $30,000. The bank fraud charge to which she pleaded guilty is punishable by a maximum potential penalty of 30 years in prison and a fine of $1 million. Sentencing is scheduled for February 19, 2013.

Source: Examiner.com

Fake Credit Cards Used for Bank Fraud


A recent instance of Fraud in a New South Wales bank showed that fake credit cards were used to fleece the bank. A WESTPAC employee is accused of creating fake credit cards to fleece the company of more than $110,000.

Police from The Rocks Local Area Command were contacted by the bank510 internal investigators on Friday morning in relation to fraud involving one of their employees.

The same morning, officers arrested a 25 year old man outside his workplace at the corner of Market Street and Clarence Street in Sydney510 Central Business District.

The Method:

It is alleged that the man created nine fake credit card accounts and used them to withdraw a total of $113,930 from several ATMs over the past year. He has been charged with nine counts of fraud and one count of knowingly dealing with the proceeds of crime.The man is out on conditional bail and due to appear at Downing Centre Local Court on December 4.

Source: The Australian

Gang Behind Australia's Largest Credit Card Data Theft


A joint international criminal investigation has resulted in seven people being charged in Romania for the largest credit card data theft in Australia510 history. The criminal syndicate had access to 500,000 Australian credit cards and approximately 30,000 credit cards have been used for fraud transactions amounting to more than $30 million.

The Method:

The gang exploited loopholes in POS terminal security at 100 small businesses across Australia, recording card details to create counterfeit cards that were used in numerous overseas locations including Europe, Hong Kong, Australia and the United States.

Australian Federal Police (AFP) manager for cyber crime operations, Glen McEwen says the arrests are the result of significant cooperation across law enforcement and the financial industry. "This is the largest data breach investigation ever undertaken by Australian law enforcement," he says. "Without the cooperation of 13 other countries, along with Australia510 banking and finance sector, we would not have been able to track these illegal transactions to the criminal network in Romania.

Source: Finextra

Bank Frauds Could Soon Be The Customers Fault


Banks are increasingly trying to share the responsibility of debit and credit card fraud with customers.

Customers could be liable if they use a PIN that can be easily guessed or the bank decides they have been careless and allowed a criminal to see the number at a cash machine.

This could involve a bank looking at CCTV footage to see if customers have failed to shield the keypad from passersby. The changes - which have been pioneered by Santander and are set to be adopted across the industry - give banks greater freedom to refuse to refund losses if they decide the customer has been negligent.

The introduction of chip-and-PIN credit and debit cards in 2005, which replaced signatures to authorize purchases, was supposed to kill off card fraud. But following an initial fall, fraud is on the rise again, so banks are looking for new ways to stem their losses.

These changes have been opposed by many customers and also some card security experts. However more and more banks are considering this move to secure their losses.

Source: Dailymail

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