The hottest scam in Florida and spreading nationwide, is the mass production of counterfeit credit cards embedded with account numbers of unwitting consumers.
Always looking for new ventures, some of the same rings of identity thieves long engaged in other forms of fraud are making hundreds of fake cards and taking them on the road to withdraw cash or buy goods, police say.
Counterfeit cards are not new, but their use has exploded during the past two years as computer hackers steal millions of records from major retail stores and rings of thieves develop new ways to skim information from ATMs and credit card swiping machines.
Anyone who uses a card to withdraw cash or buy something can become a victim.
Much of this growing crime radiates from Florida, long a hub for Medicare fraud, telemarketing scams, tax-return rip-offs, investment schemes and other forms of flimflam.
Airport security agents sometimes call Broward County sheriff’s detectives to say they’ve stopped a departing passenger with hundreds of apparently phony cards. Orlando police, meanwhile, are chasing scammers who stick devices into ATMs to copy account numbers, which are quickly embedded into counterfeit cards.
It’s all part of a growing black market that connects sophisticated hackers in places such as Russia or Ukraine to common thieves close to home.
“Everybody’s working on it constantly to steal your credit card number because it’s incredibly lucrative,” said Orlando Police Detective Michael Stevens. “And it’s very difficult for us to move quickly enough to catch them.”
Florida serves as a headquarters for counterfeit card-makers, known as “carders,” and of highly mobile criminal networks that use and distribute their creations.
“We are seeing quite a lot of people leaving Florida to go out west with counterfeit credit cards, usually to the Texas/Arizona area,” said Broward sheriff’s Detective Mitch Gordon. “We’ve seen them with a hundred cards in the same name. On the back, in the magnetic strip, there are a hundred different account numbers. The cards have been re-encoded with someone else’s information.”
In May, Egor Shevelev, a Ukrainian online salesman, was sentenced by a federal judge in Fort Lauderdale to 14 years in prison for trafficking in more than 118,000 stolen and fraudulent credit card numbers. Prosecutors said his crime ring may have stolen as much as $59 million, but the actual loss to hundreds of victims is impossible to calculate.
Orlando police are investigating other rings that use a skimming device about the size of a pinkie finger. For a price, some store clerks or restaurant cashiers have used the device to secretly copy account numbers and turn them over to identity thieves.
Other devices are inserted into ATM slots to copy the numbers and financial codes contained in the magnetic strips. The crooks then retrieve the devices or, using Wi-Fi technology from a nearby car, draw information from them into a laptop computer.
Encoders are then used to transfer that information onto newly created cards. They can be blank gift cards, hotel card keys, old credit cards — anything with a magnetic strip that is new or can be overwritten.
“It’s not illegal to possess these devices,” Stevens said. “Why? I have no idea. They serve no other purpose than to steal your credit cards.”
The credit cards are usually used to buy merchandise that is sometimes turned over to criminals accustomed to selling stolen goods, Stevens said. Orlando police also are investigating a crime ring that uses counterfeit debit cards.
“They were taking these debit cards from ATM to ATM and sucking money out to the limit,” he said. “It’s easy money.”
Florida far leads the nation in both fraud complaints and identity-theft complaints filed by consumers to the Federal Trade Commission.
Last year, the state had 805 fraud complaints per 100,000 people and 193 identity-theft complaints per 100,000, FTC records show. The Miami-Fort Lauderdale-West Palm Beach area topped the list of identity theft complaints among large metro areas. Orlando-Kissimmee-Sanford ranked 11th.
Police and consumer advocates hope the replacement of magnetic strips with computer chips — which may begin next year — will help curb fraud because the chips are much harder to counterfeit.
In the meantime, Breyault advised consumers to be wary of ATMs not attached to bank branches, such as those in bars, restaurants and gas stations.
“Be sure to look at the ATM before you dip your card in,” he said. “If you see anything amiss or something attached to it that shouldn’t be there, think twice before you use that ATM.”
Tips for card users
If you believe you’re the victim of credit card fraud, report the crime to police immediately and keep a copy of your police report or case number.
Immediately contact your credit card issuers. Get replacement cards with new account numbers and ask that the old account be processed as “account closed at consumer’s request.”
Keep a log of all conversations with authorities and financial entities.
File a complaint with the Federal Trade Commission’s Consumer Response Center, 1-877-382-4357.
To prevent fraud, provide your credit card number only to merchants you know and remember to protect your Social Security number.
Source: U.S. Secret Service
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