Detective Carl Berry of the Organised Crime Unit of the Jamaica Constabulary Force shows merchants and employees a fake credit card that was seized by the police, at a National Commercial Bank merchant fraud seminar in Kingston. - Contributed

The Organised Crime Unit (OCU) of the Jamaica Constabulary Force is again warning Jamaicans to exercise greater diligence in the face of increasing fraud, some of which involves identity theft.

As the use of credit and debit cards grows, the banks are finding that cloning is also on the rise.

So concerned is National Commercial Bank (NCB) that its Risk Management and Securities Division hosted seminars on merchant fraud just ahead of the high-hopping season.

uptick in fraud

The timing was not coincidental. The bank says it usually sees an uptick in credit-card fraud in the November-December period.

Still, local banks are reluctant to relate their losses, or even to speak specifically on the issue; but NCB and Scotiabank's seminars suggest that the problem is substantial enough for them to invest in training sessions for merchants to raise their awareness of prevalent scams and techniques for detecting fraudulent cards.

"Banks have taken the position not to report the matter (cases of fraud)," said Superintendent Fitz Bailey, head of the Organised Crime Unit. "They see it is a loss and make provision for it as a loss.

"From a police perspective, we know there is in fact an increase, especially the issue of cloning of debit and credit cards. We have seen an increase, in the past four or five years, and they are getting more sophisticated."

NCB says its problems relate to stolen cards, counterfeits and the fraudulent use of account numbers.

The thieves are not, said NCB, discriminatory about the types of cards that are targeted; both local and international cards are involved.

But Detective Carl Berry of the OCU, who was a presenter at the NCB seminar, said more than 90 per cent of fictitious cards are 'issued' by foreign financial institutions.

The bank says that there has been "a gentle decline" in losses to card fraud over past months, but not in the attempts at fraudulent transactions.

"Traditionally, we see an increase in fraudulent activity from early November to late December each year," said the NCB communications unit.

"While the overall losses may not increase, attempts at fraud and transaction counts often increase."

Card thieves tend to forge signatures on transaction sheets for signed cards that were either stolen or found, and where the cards are unsigned, they affix their own.

In some instances, legitimate cardholders write their PINs on the cards, giving the thieves easy access to their accounts through ABMs.

unsafe locations

Persons may also leave their cards in their car, wallet or purse at unsafe and unattended locations, for example, the gym, car wash, office, or even at home.

Counterfeit card fraud involves the cloning or duplication of a legitimate card by a fraudster and its use to obtain goods or service at the point of sale or for cash at the ABM.

The cloning is initiated through a process called 'skimming', where the magnetic stripe of a legitimate card which bears the card number, expiry date, cardholder's name and security codes are copied. This information is manipulated and placed on another plastic without the cardholder's knowledge.

keep in line of sight

One of the tips the banks give is to ensure that the card is always in one's line of sight when tendered for purchases, as a safeguard against 'skimming'.

The practice was detected, according to Sunday Business sources, at a well-known retail operation, where it was carried out by a cashier.

NCB says skimming is known to happen most often at gas stations, restaurants and such locations where card payments are processed outside the view of the cardholder.

The fraudulent use of account numbers involves the use of the card number of a legitimate cardholder, which is obtained by a fraudster and used to make purchases primarily over the telephone or via the Internet.

According to NCB sources: "The points of compromise in this type of fraud are widely va-ried as it can occur at any point where card numbers are collected in legitimate transactions with or without the customer or card being present."

Card numbers may be compromised through extraction by computer hackers, or hi-jacked via Internet spoof sites, called 'phishing', transaction receipts that display the full card number, merchant outlets, or even by way of someone gaining access to an unattended bag or wallet and copying the card details.

types of fraud

As this type of fraud in most instances requires only the card number and expiry, it is relatively commonplace, especially if merchants and financial institutions do not employ proper data-security measures.

Persons affected by the fraudulent use of account numbers are wide ranging as the nature of this type of fraud does not require an act of negligence or lack of vigilance on the part of the cardholder.

Scotiabank Jamaica says it finds that phishing is on the increase. That is where individuals try to get others to send them their account information.

"If someone calls and tells you you have won the lotto and they need your account to send the information, it is a scam. Or if they call and say they are updating records and need information, call the organisation to verify," advises Elena Villafana-Sylvester, vice-president of electronic financial solutions and retail banking.

"Fraudsters will clone sites and when you click on their link, they get all of your details."

Villafana-Sylvester says electronic fraud is managed at Scotiabank on two levels - cardholders and merchants.

monitoring system

For cardholders, the bank utilises E-Falcon, an internatio-nally reputed monitoring system.

"We are able to look at cardholders' behaviour and then track for unusual behaviour," said the bank executive.

"If, for instance, we see tran-sactions happening in Jamaica at 9 a.m. and then at 10 a.m. in Paris, we will call the cardholder to verify that everything is all right."

On the merchant level: "We are training and retraining our merchants, also providing brochures to refresh them on what they should be looking for," said Villafana-Sylvester.

"One of the things fraudsters do when cloning a card is to copy the marked stripe and encode it on a blank card."

Detective Berry says fraud in Jamaica remains a fundamental problem and "a challenge for law enforcement".

In recent times, the OCU has executed the arrest of several major players for fraud, including lottery scams and money laundering.

tackling these issues

"We are on a drive to tackle these issues," the detective said.

"People need to watch their pocketbooks. Be careful of how you dispose of your bills, especially those connected to your bank account, before you throw away garbage. Check your credit-card receipts to make sure money is not being spent that you did not spend. Check your bank accounts regularly."

Banks, said Detective Berry, should scrutinise Visa and MasterCard security features, as over 90 per cent of fictitious cards originate from overseas institutions.

avia.ustanny@gleanerjm.com