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A Thing From Russia, with Fraud

From Russia, with Fraud

C redit card fraud is a huge and growing problem - that's not news. Stolen credit card numbers are offered for sale on the Internet every week by the tens of thousands. Members-only sites that are really cyber-black marketplaces for fraudulent information are thriving. Nothing surprising there. Card fraud and identity theft cost the financial services industry $1 billion a year, by some estimates. Personal information is stolen and traded more easily than ever before in the information age. That's not news, either.

What is news is that the online bazaars where people buy and sell credit card numbers and other personal information are run increasingly in large part by residents of the former Soviet Union.

According to an article in the New York Times, a high-tech executive who surreptitiously monitors Internet card markets said the Russian connection to card fraud is huge. Other security experts say the buyers of the card numbers on the sites are all over the world but seem to be based mostly in countries of the former Soviet Union, Eastern Europe, Malaysia and Asia. Stolen cards also have been purchased in Saudi Arabia and Dubai. Buyers use the numbers in a variety of online frauds, including making purchases over the Internet, fencing them in Western countries and extracting cash advances directly from the credit card accounts.

Marketplace operators living in the former Soviet Union, often in Russia and Ukraine, are buying the numbers from "black hat" computer hackers who get them by breaking into online merchants' systems and gaining access to thousands of card numbers at a time.

The marketplace sites are mostly known only to their participants - but that can mean as many as 2,000 registered users. The sites include reviews or endorsements of sellers, similar to those posted on eBay or Amazon.com. Prices for the cards range from 40 cents to $5 per card but can go as high as $40, depending on the quality of the authenticating information. The numbers also are sold in bulk ranging from $100 for 250 cards, to $1,000 for 5,000 cards.

Fraudulent activity on the sites can be monitored, but the crooks are hard to track down since they don't use their real names or divulge their whereabouts. They buy the cards with secure money transfers online. The marketplaces are easy to start and shut down on the Web; they also take place on the Internet Relay Chat, a communication network.

   

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