With the recent spree of credit card breaches, the press has used the terms “identity theft” and “credit card fraud” together so frequently that the two crimes have become synonymous. However, there is a distinct difference between these two crimes. While credit card fraud is a form of identity theft, true identity theft is far more serious.
When Is It Credit Card Fraud?
Credit card fraud occurs when someone steals and uses the information of a particular credit (or debit) card. Often these crimes are snatch-use-ditch affairs, where the thief will continue to use the card as long as possible and then discards it. However, it’s not only your physical card you have to guard from thieves. If your card number and information are stolen, the thief may make fraudulent purchases online. The card can physically be in your wallet and still be a stolen card.
Credit card theft falls under the umbrella of identity theft, America’s fastest growing crime as recently reported by the White House.
When Is It Identity Theft?
Identity theft occurs when a criminal obtains the personal or financial information of another person, such as Social Security or driver’s license numbers, in order to impersonate that person for fraudulent gain.
Identity thieves steal a person’s information to obtain credit, merchandise, or services in the name of that person. The thief may access the person’s bank or credit accounts, but the criminal is just as likely to open new accounts using the victim’s name and social security number. It’s a more profitable stratagem, since one can open a new credit card account under someone else’s name, max out the card, and then default—leaving the victim holding the bag.
Why Identity Theft is Much More Dangerous
The thief can also provide the stolen information as personal identification to police, creating a criminal record or leaving outstanding arrest warrants for the person whose identity was stolen. Not only can identity theft negatively impact the victim’s finances, but identity theft can tarnish a victim’s personal record with criminal activity and legal offenses.
Identify theft can continue for years without detection. Sadly, a victim may not know that his identity was stolen until he surprisingly defaults on debts or is pulled over for a traffic violation and learns that he has a warrant out for his arrest.
Combat Identity Theft and Credit Card Fraud
Both consumers and organizations have responsibilities to prevent credit card fraud and identity theft. Consumers have the right to question merchants about how consumer information is being protected, and organizations are responsible for securing sensitive information by completing required tests or audits specific to the industry.
To prevent credit card fraud and identity theft, Dara Security helps organizations achieve a more secure data environment. Our PCI QSA, PA QSA, and P2PE certifications as well as our experience with specific industry audits show that we have the expertise to advise clients on how best to secure their environments and ultimately, the consumer data entrusted to them.
