What are Credit Card Dumps? And How it works?

This is all you need to know about Credit card dumps and how to avoid becoming a victim.

So if you want to know about: What are credit card dumps? How to avoid becoming a victim. What are the punishments? Etc.

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Credit card dumps are illegal digital copies of data stored in a credit card’s magnetic strip. It keeps sensitive information such as card numbers or expiration dates.

This information is sensitive because hackers use this information to copy your credit card to make online transactions.

This term is becoming recognized due to growing cases of credit card forgeries, identity theft, and cybercrime.

Identity Theft

Identity theft can occur in a large-scale data breach like the ones that have occurred in which thousands of users find their information at risk. 

However, similar cases occur on a small scale, with lesser people exposed to credit card theft.

Credit card dumps are growing as a form of cybercrime. 

While these forms of corruption have been around for several years, they are gaining public awareness in recent years due to more cases of credit card forgeries, identity theft, and other types of cybercrime. 

These crimes are increasing due to increasing e-commerce and online financial transactions. 

For instance, in 2019, out of the 3.2 million-plus cases that came to the Federal Trade Commission (FTC), 20.33% of cases were identity theft, making it the most common type of cybercrime.

How a Credit Card Dump Works

Hackers create credit card dumps in a few different ways.

A common method that hackers apply is known as skimming. In this method, hackers hide a card reader in an ATM or a fuel pump or any place that you will have to swipe your card.

How a credit card dump works

This reader “reads” and stores the credit card details of all the cards used in that place. And the owner gets to use this information. 

This is a fairly old school method that has been in use for several years now. 

Other more invasive ways to get credit card dumps are hacking into a retail network or using malware to attack the point-of-sale or merchant’s device. 

But, again, this makes it easier for criminals to access credit card data. 

Other methods are getting credit card data through a concerted data breach on corporate sites and their servers. 

Other means are phishing websites that target eCommerce sites to access sensitive information, including credit card details.

For instance, 40 million accounts of people who used credit and debit cards on American retail company Target were hacked in a peak shopping season. 

The company confirmed the news through a press release. All buyers that shopped at Target stores in the Black Friday time frame were at risk.

Why is this an Issue?

While modern cards have security chips and other sophisticated protection measures to keep credit cards secure. Hackers are always look for new ways to take advantage of security vulnerabilities and loopholes in electronic financial transactions. 

The magnetic stripe on a credit card contains three types of info. 

The first track has alphanumeric information, like the credit card number, the name of the card holder, and the card’s expiry date. 

The second track has numeric info, like the card number and its expiry date. Finally, the third track has the country or currency code for the card.

Cybercriminals or hackers who get credit card dumps can use the information on their own, or they can put it up for sale to other people (read criminals) online or via social networks. 

Some reports said that credit card dumps with US card data can be sold for anywhere between $20 and $80 per card on websites that deal with such data.

This becomes an issue since, in most cases, credit card users do not find out that their credit card data has been copied or compromised. 

The credit card data thieves do their best to avoid theft detection since the cardholder would easily cancel their card if they suspect it has been compromised.

Warning Signs:

Credit card fraud detection

The first sign that your card has been part of a credit card data dump is when you find a transaction in your statement that is not familiar. 

Nowadays, however, it is usually the eCommerce service provider that disclosed that their customer’s credit card information might be compromised.

In most cases, individual consumers are prey to credit card theft. Still, some cybercriminals are working actively on a large scale. 

These, however, target credit card dumps from the systems of large and established businesses.

If they are successful, they get credit card dumps of thousands of cards and resell them for a large amount of money. 

The ongoing series of hacking attacks that target high-volume online retailers highlights just how hard it is to put an end to such crimes. 

Unfortunately, these crimes seem to be here to stay and seem to be increasing with the growth in online business.

Also consumers are increasing of choosing credit card as companies are offering various advantages.

Protect Yourself from Credit Card and Identity Theft

While cybercrime and credit card theft seems to be here to stay, there are some steps we can take as credit card users to protect ourselves from cybercrime and practice safe cyber commerce transactions. 

While doing this is not a guarantee of protection from cybercrimes. Still, it can act as a deterrent and help you avoid the chances of becoming a victim of credit card dumps.

A website is secured if the page where you will your card information has a URL that begins with “https://.” 

In addition, the search bar should have a lock displayed with the URL. This shows that you are on a secure website.

Figure 1

Some Common Steps To Take To Protect Yourself and Your Credit Card Are:

  • Make it a point not to hand over your card to anyone in stores. If you do have to hand over, for instance, to a waiter in a restaurant, keep an eye to see that they do not go elsewhere and take your card straight to the payment counter.
  • Be alert when you use ATMs, fuel stations, and other POS machines. If you come across one that looks unusual or has a different structure than a normal one, ask staff about it or a manager so that you make it evident that you are wary.  Some machines have an added device on the POS that reads and stores credit card data for thieves to access.

Figure 2

  • The most important thing, check all your transactions on your credit card statement for foreign or irregular transactions. This includes smaller and familiar entries like grocery or fuel. If something is out of the normal, inform your credit card company about your reservations if you find anything irregular. 

Figure 3

  • Make it a point not to share credit card information in e-mails or social media chats and posts.

Bear in mind that criminals often check the validity of the credit card information they have by making small transactions and may be able to avoid detection.

EMV Enabled Credit Cards

EMV chip credit cards are cards with which the credit card industry tries to combat security compromises about credit card data. 

If you have a chip card, your credit card information is coded and is less vulnerable to hacking.

EMV enabled credit card

In EMV cards, the credit card information is stored on the chip. However, it is still vulnerable to plan cyber attacks when you swipe it in a place where the POS installed is not a chip reading one.

What to do if your Credit Card Information is Leaked:

If you think that your credit card information has leaked, get in touch with the credit card company at once to cancel your credit card. Highlight any unauthorized transactions that you find. 

Most credit card issuers have a policy of zero liability. Which means that you would not be held responsible for charges to your credit card from unauthorized persons.

Most countries have independent websites and agencies that handle cases of identity and credit card theft. For example, in the US, the Federal Trade Commission supervises a website known as Identity Theft.

Which guides credit card dump victims about the proper steps to follow in reporting and recovering from credit card and identity fraud.

What is the Punishment for credit card theft and fraud?

Punishment for credit card theft and fraud

The laws are different across the United States for prosecuting credit card fraud. 

Apart from the identity theft itself, cybercriminals can be placed under trial under federal law for using devices that promote cybercrime activity, like using card skimmers or other illegal data access gadgets. 

Minor offenses usually end in fines,  short jail time, or both if the theft is felony-level, with significant scale credit card theft and fraud. 

The duration of the sentence is based on multiple factors. 

For example, in some states, if the extent of the crime calls for a felony conviction, the felony is split into different categories, usually based on the state’s laws regarding identity theft.

What are the factors in Legal Recourse?

These include the person’s history, the value of the theft. It is also based on the intent of the person. 

For example, was it an accidental misuse of credit card information or deliberate theft of data on a large scale? It also depends on if the victim was old or not.

Suppose someone close to you used your credit card to pile up credit card debt, but you are unwilling to have them tried for theft and felony.

In that case, it is possible to solve the issue without resorting to cybercrime authorities.

However, keep in mind that if you don’t have documentary proof from law enforcement that you were a victim of identity theft, your credit score will be affected. 

Unfortunately, that means that all future loans and your credit score will suffer as creditors will hold you responsible for credit mismanagement and poor financial planning.

Sounds too bothersome? Check out these stats to get some motivation to protect yourself:

Key Facts

  • In 2019 there were 650,572 cases of identity theft.
  • Most cases of identity theft were reported last year by people aged 30 to 39.
  • The top three states for identity theft are Georgia, Nevada, and California in terms of population.
  • Credit card fraud is the most common type of identity theft, with over 270,000 cases reported. This figure has more than doubled between 2017 to 2019.
  • Data breaches in 2019 exposed over 165 million records that held consumers’ data.
  • The personal data of over 100 million consumers were exposed in the United States. This happened in the Capital One cyber incident, which was the most significant data breach of 2019.
  • The top cause of exposed records is unauthorized access. This is on the rise and linked with personal information in data breaches.
  • In 2020 by the end of July only, the FTC had reportedly dealt with over 150,000 COVID-19  and stimulus-related fraud cases.

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