Greetings,
Note: The following was provided to us by our friend, Rob Lavinsky.
We have also received several of these orders from Indonesia, the
Philippines and Romania and so caution all who are doing business
via mail order to beware.
EXPANDED NOTE TO ALL DEALERS: In the past several days since I
posted a warning note, I have heard from over a dozen people hit by
this crime and I almost lost 12K myself, and so I am expanding my
message here in the hopes that word will spread.
A ring of credit card thieves from Indonesia has been trying to
purchase gold and gem crystals, gem collectibles, etc., using stolen
card numbers. Beware of large orders of such items! These are
convertible goods and they will then pawn these items for cash,
leaving you to eat the monetary damages! Once the legitimate
cardholder reports the fraudulent use of the card, they will get a
refund and 60-90 days later the credit card company will withdraw
the funds from your account. YOU are liable for the money if you did
not verify the cardholder’s identity first by confirming the billing
address, as per the most recent VISA/MC regulations and
recommendations. They have computer-predicted numbers only, and do
not have the billing address info needed to assure that the numbers
are legitimate. If you have any doubts, ask the customer to confirm
billing addresses and then call the cardholder’s bank to confirm
that the card really belongs to that owner, particularly when the
order is from Indonesia, Singapore, the UK, and Romania (this info
according to MBNA Bank’s loss prevention department, whom I called
recently). Several of us have been hit by a “gentleman” named Ikwan
using aliases such as “johnny panther” and “andy jesus”.
Apparently, they run small charges of pennies to $1 on thousands of
predicted numbers til they find a “hit,” and then use that valid
card number for purchases, even while the owner never notices the
test charge that went through. They will use the cards to order
$2500-3000 at a time, and spread large orders over 4-5 cards! You
will get the money because the cards ARE good…they do not come
back with a fraud rating until reported. However, the money will
just be taken away later. Better to be careful now. The bank reps
that I talked to were COMPLETELY resigned to this as a perennial OLD
problem, that is new only to us. They were totally unsurprised when
I called.
FOR SECURITY, VISA/MC now encourages card acceptors to confirm
billing address of customers with each transaction, for the best
discount rates and for maximal protection against card fraud. I
personally participate in this program, despite the slight extra bit
of time it takes to run charges. It is obviously worth the slight
additional time required!
To customers, please note that this problem has absolutely nothing to
do with your personal decision to spend money on the net or use cards
for online orders! These criminals are not getting their number from
vendors you have shopped with on the web, but rather by computer
prediction of valid numbers and trial & error. Any card information
you provide to me (and to most vendors) is completely secure, and i
verify all billing addresses precisely for the reason of avoiding
such fraudulent use of your card numbers. This situation is a problem
for dealers… While the customer is fully protected by your credit
card providers, we are not.
Warmest regards,
Richard Hughes