What is wrong with getting fake credit cards?

getting fake credit cardsUsing a fake credit card is considered a fraudulent act and is generally weighted as a felony by the federal government and the vast majority of U.S. states. Punishment for such as act can include stiff fines and a lengthy prison term.

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Even having a fake credit card in your possession can lead to trouble, as many of the statutes concerned with identity theft and fraud in the U.S. mirror the laws on the books dealing with the production and distribution of counterfeit currency. In both cases, counterfeiting and fraudulent credit card acts, the perpetrator is manufacturing money!

It is unlawful in the United States to deface U.S. currency. It is also against the law to use, manufacture, or even possess counterfeit U.S. currency. If you unwittingly walk into a bank with a fake bill, an alert teller will take if from you and thank you for your diligence in turning it in.

However, if you should knowingly cash, exchange or in any other way try to use that false banknote, the U.S. Secret Service will quickly be knocking at your door. It is much the same with credit card fraud. Credit card fraud is a serious issue for the U.S. government.

Some sources justify having access to, or using fake credit card numbers. They say that as long as the numbers don’t work or they don’t use them, there shouldn’t be a problem, but numerous state and federal laws would disagree!

How Fake Credit Cards Are Made

Switched.com, now a part of Huffpost Tech, reported on one high tech scheme to commit credit card fraud; altering encrypted data on the magnetic stripes of legitimate gift cards and credit cards.

While difficult to accomplish, tech savvy thieves have gotten away with millions of dollars in pilfered goods and services using this method. Phishing for valid credit card numbers using a random numeric generator is another popular method used to create virtual phony credit cards.

Very real looking credit cards can also be manufactured with the right equipment.

In 2008, the Newport Beach, CA police department produced a documentary, which was uploaded to the YouTube website. The short, three-minute video takes the viewer on a tour of, what at that time was state-or-the-art credit card counterfeiting equipment.

fake credit cardsIn this particular example, a police detective shows us a specialized machine, available for about $10,000, which credit card counterfeiters used to produce almost flawless copies of real Visa and MasterCard logo credit cards. When asked how much money these particular credit card fraudsters accumulated with their high tech machines, the detective responds that they stopped counting once they had reached and exceeded a million dollars in ill-gotten gains!

This particular YouTube video, has been viewed more than 600,000 times since it was posted in 2008. Visit YouTube and you’ll find there are more than 4,000 entries listed on the site under credit card fraud!

Fake Credit Cards Are Costly to Issuers

Credit card issuers do not publish the losses they write off each year because of credit card fraud. While Visa and MasterCard won’t release actual figures, it is estimated that losses amount to seven cents for every $100 worth of credit card transactions.

Experts figure these losses ultimately add up to more than 2 billion dollars globally, each year. The Federal Trade Commission, FTC, in 2003 estimated that more than 6 million Americans experienced credit card fraud.

Consumers Can Protect Themselves

The Federal Credit Card Act eased the consciences and pocketbooks of many fretful Americans by limiting potential losses due to identity or credit card theft to just the first $50 of fraudulent charges. If the loss or theft of a credit card is reported soon enough, consumers will often escape even those minor charges.

While we all grow up being taught that crime doesn’t pay it certainly seems that fake credit, debit and gift cards can lead to quick riches. Some would justify their use by saying no one gets hurt, only the banks lose out, and they’re making too much money anyways.

Experience has taught us that this is false and that someone always pays.

Consumers should take swift action to report identity theft and suspected credit card fraud. While each individual consumer may be limited to just $50 in potential fraudulent credit card transactions, we know deep down that we pay for the larger losses too, in higher interest rates, charges and other fees for every credit card purchase we make.

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Disclaimer: This content is not provided or commissioned by American Express, Visa, MasterCard, Discover, or any other credit card company or issuer. The opinions expressed here are the author's alone, not those of any credit card company or issuer, and have not been reviewed, approved or otherwise endorsed by any credit card company or issuer. Credit Card Chaser may be compensated through various affiliate programs with advertisers. As always, Credit Card Chaser is an independent website commmitted to helping people research credit card offers and find the best credit card!