GB2258425A - Credit card fraud prevention - Google Patents
Credit card fraud prevention Download PDFInfo
- Publication number
- GB2258425A GB2258425A GB9117030A GB9117030A GB2258425A GB 2258425 A GB2258425 A GB 2258425A GB 9117030 A GB9117030 A GB 9117030A GB 9117030 A GB9117030 A GB 9117030A GB 2258425 A GB2258425 A GB 2258425A
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- GB
- United Kingdom
- Prior art keywords
- card
- user
- cards
- code
- authorised
- Prior art date
- Legal status (The legal status is an assumption and is not a legal conclusion. Google has not performed a legal analysis and makes no representation as to the accuracy of the status listed.)
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Classifications
-
- G—PHYSICS
- G07—CHECKING-DEVICES
- G07C—TIME OR ATTENDANCE REGISTERS; REGISTERING OR INDICATING THE WORKING OF MACHINES; GENERATING RANDOM NUMBERS; VOTING OR LOTTERY APPARATUS; ARRANGEMENTS, SYSTEMS OR APPARATUS FOR CHECKING NOT PROVIDED FOR ELSEWHERE
- G07C9/00—Individual registration on entry or exit
- G07C9/20—Individual registration on entry or exit involving the use of a pass
- G07C9/22—Individual registration on entry or exit involving the use of a pass in combination with an identity check of the pass holder
- G07C9/25—Individual registration on entry or exit involving the use of a pass in combination with an identity check of the pass holder using biometric data, e.g. fingerprints, iris scans or voice recognition
-
- B—PERFORMING OPERATIONS; TRANSPORTING
- B42—BOOKBINDING; ALBUMS; FILES; SPECIAL PRINTED MATTER
- B42D—BOOKS; BOOK COVERS; LOOSE LEAVES; PRINTED MATTER CHARACTERISED BY IDENTIFICATION OR SECURITY FEATURES; PRINTED MATTER OF SPECIAL FORMAT OR STYLE NOT OTHERWISE PROVIDED FOR; DEVICES FOR USE THEREWITH AND NOT OTHERWISE PROVIDED FOR; MOVABLE-STRIP WRITING OR READING APPARATUS
- B42D25/00—Information-bearing cards or sheet-like structures characterised by identification or security features; Manufacture thereof
- B42D25/40—Manufacture
- B42D25/405—Marking
- B42D25/425—Marking by deformation, e.g. embossing
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- Engineering & Computer Science (AREA)
- Manufacturing & Machinery (AREA)
- Human Computer Interaction (AREA)
- Physics & Mathematics (AREA)
- General Physics & Mathematics (AREA)
- Credit Cards Or The Like (AREA)
Abstract
A method for fully guaranteeing that the user of a credit card, debit card, charge card or cheque guarantee card is the authorised user of that card, including means of storing information in coded form on the card so that only the issuing bank and the sales outlet are privy to the deciphering of said code, all the relevant information particular to the user appearing on the card either visibly to the naked eye or by other means e.g. electronically, with the added security that in the event of an identical but unauthorised user being in possession of a card a code word may be required before authorisation of transaction is granted, the coded information may appear in the form of embossed characteristics, flush with the face of the card or magnetically stored or any other method of practically storing information on a card made available for such uses. The coded information relates to a personal individual characteristics e.g. race, age, build, hair or eye colour, or gender.
Description
SUBJECT: CREDIT/CHARGE CARDS
OBJECTIVE: TO DISCOURAGE CREDIT/CHARGE CARD FRAUD.
INTRODUCTION.
Credit/Charge card fraud is now rampant in the financial sector and has become an ever-growing problem to resolve.
The basic problem seems to be the theft of newly issued cards whilst in transit (or their hijacking at points of destination > whilst the main problem still remains the theft of existing cards and subsequent forgery.
Presently, the card-issuing organisations have a range of policies to combat these problems, the more effective of these being the introduction of 'floor limits' and the subsequent 'phone-approval' system. Suspect customers/-cards are invited to identify themselves by approved positive identification (e.g. mothers' maiden name).
Again, in attempting to prevent the theft of new issues, prospective card-holders living in high risk areas are advised to collect their cards at-a given branch, otherwise courier services are enlisted.
In the first instance, cards whether stolen and signed or stolen and forged, can still be mis-used provided the thief stays below the 'floor limit' hence the phone-through system becomes ineffective.
Futhermore, the theft of a newly issued card with the thief's signature on it allows usage up to the credit limit without fear of apprehension.
In the second instance, the mode of distribution of newly-issued cards places an added financial burden on the card companies and is more iikely to inconvenience the customer.
The aim of this project is to initially attempt to thwart the theft of newly-issued cards whether in transit or at point of destination.
This is achieved by engaging Stage 1 i.e parts 1) and 2) of the plan.
The plan is then extended to tackle the bigger problem of stolen cards and forged signatures.
(Current estimates put the figure for such mis-use at ,145 million a year).
NETHOD.
1) Pre-signed issues:- A pre-signed card, newly issued to a prospective customer, is not an appealing target for a thief.
Firstly, most of these sort tend to steer clear of what is a blatant criminal act - FORGERY!
It's a completely different thing putting a signature on an unsigned card, but when it comes down to forging a signature, a thief will think twice. To most, the risk is not worth the bother.
Secondly, even if we have a determined thief prepared to risk forging signatures, the fact that the card is signed will give him/her less freedom for manoeuvre and reason for caution. After all, he/she has no idea whether the card is a new issue or a replacement! For all he/she knows, it could be a replacement for an account already at it's limit.
So unlike a new unsigned issue, he/she just can't walk into an establishment on the day of the theft and spend as much as he/she likes in the knowledge that any phone call will be met with approval.
The method of arranging distribution of pre-signed new issues would be as follows
At the bottom of every credit/charge card application form will be a detachable portion.
On this portion will be a glossy template on which a removable signature strip is affixed.
Applicants are requested to sign on this strip with their usual signature. < All other normally requested signatures are unaffected).
On receipt of the completed application forms, the card-issuing organisations process the applications, detach the lower portion and forward them to their respective Card Distribution Centres, (CDC).
At CDC, the signature strips are removed from these portions and affixed permanently to the corresponding cards before being sent out.
(Standard letters advising prospective customers of the imminent arrival of their cards can be maintained).
If the level of fraud in this respect does not. ilzcfifw +hP cn setting up such a system, then the plan can he restricted to high-risk areas (or used as appropriate by the financial establishments).
The following sub-heading is included for assessment only as an extension to 'Pre-signed Issues' and neither the cost-effectiveness nor the feasibility has not been researched.
2). Canouflage:- This plan aims to provide added security for cards in transit by confusing a would-be thief.
Considering the fact that cards in the post are easily identified, the aim here is to accord them a better disguise.
Working on the principle 'if the temptation is not presented, the crime is less likely committed', the idea would be to disguise the presence of the cards by wedging them into an envelope-size cardboardiplastic; predesigned with cut-out, card-size apertures.
Once the prototype cardboard/plastic casing is designed to fit the envelopes and accept the cards ( a prototype with two apertures may also be required, e.g. joint applicants and supplementary cards), multiples will be made readily available to CDC. Cards must be flush with casing.
3).Coded Signatures:- Forgery of signatures using stolen cards is by far the most difficult to combat in card fraudulency.
The means by which fraud in this respect is detected is by establishments phoning through for approval (and less often, on suspicion). Establishments are often issued with updated lists of stolen cards.
But what if the cards are not reported stolen on time? And even then, what if the fraudster makes purchases below the 'floor limit?'.
What is required is a coded signature which is known only to the cardholder and recognisable only by the establishment.
The aim is to alert the establishment to suspect card transantions thus prompting a phone call irrespective of 'floor limits'. The purchaser can then be asked to identify him/herself in the normal mode of queries.
The way this is achieved is as follows
The Processing (or Fraud) Units of the credit card companies will design a coding system based on the first (or other) letter of the surname of the card-member such that the code/(mark) is unique to a group of cardmembers.
An example of this would be to advise all card-members with surnames beginning with the letters A - E that they have been assigned with a specified code which must always be declared (either verbally or written), whenever requested by an establishment.
This alphabetical system can be subdivided into as many categories as deemed appropriate by the 'coding system' operatives, with each category having it's distinctive code/(mark).
The coding system will be made privy only to the financial institutions and the establishments.
This way, the establishments can learn the coding system and identify genuine card-members.
Apart from the fact that our fraudster has no access to the coding system, he/she is confounded all the more by the fact that the code/(mark) will mOT be on the actual credit/charge card!
Variations to the plan
- The code/(mark) can assume the 2nd (or any letter > of the surname.
- The code be based on numbers i.e. card numbers Cor on a more complicated scale, birthdates).
- A combination of letters of the surname and numbers could be used to derive the code (see under 'Summary' and 'ADVAAtTAGES') Summary.
- Financial institutions devise a coding system.
- Card-members (new and existing), are issued with a specific code sent under separate cover.
- This code must be declared to the establishment, if requested, during transactions. They may be written (e.g. sales vouchers/cheques) as req.
- Establishments will receive copies of the coding system, and can be briefed if necessary, by the financial institutions.
- The simplicity of the coding system will enable establishments to quickly familiarise themselves with the necessary code for any named card-member.
- Failure to correctly state the corresponding code prompts a phone call from the establishment. Genuine card-members will have no objections to routine idenzification questioning from the financial establishments.
- A fraudster has no access to the coding system OR the cardmembers code.
- The whole theme to the scheme is readily adaptable such that not only can it be altered rapidly, but it can also be devised to any degree of complexity (as best suits the financial establishments).
Effectively thwarting the only source of fraud (of possible concern) is discussed at the end of the heading 'ADVANIAGES'.
4).Embossed Cards:- This plan can be introduced to strengthen the effect of coded signatures in the further prevention of misuse of stolen cards.
The idea is to send all cardmembers (new & existing) a questionnaire requesting details of certain personal information.
The data required will be:- Race/Origin; Sex; Height (in feet & inches);
Colour of hair; Build.
Each detail will be assigned a character as follows:
Race/Origin - White (V); Black (B) Asian/Arab (A)
- Oriental (O) Undeclared (U) Sex - Male (X) Female ti) Approx. height - Feet (x) Inches (x) where x is a number.
Hair colour - Black (K) Blond (D) Brown (X) - Ginger/Red (G) Other (O) Build - Heavy (H) Tedium (X) Small (S)
An example of an embossed card would be 'O.F.5.10.K.S' i.e Oriental female five feet ten inches tall with black hair and small build.
It is noticed that the 'opening' letters and numbers denote unchanging characteristics, while the end letters are variables.
This plan is very basic but is not unlike the 'photograph' scheme. It will be effective inasmuch as it gives establishments a crude picture of the cardmember and goes some way into reducing rampant card misuse.
Apart from the fact that this method serves a more acceptable form of i.D. (which in most cases would be more convenient for both customers as ell as establishments), it must be emphasised to cardmembers that though completion of the questionnaire is obligatory, the data is for their own protection and will in no way infringe their statutory rights.
On simple deduction, we find that this plan has one distinct advantage over photographs i.e. as tar as we see, there is no possible way the embossed statistics can be replaced or altered by a fraudster.
i'ote:- The above plan and example can also be varied as best suits the purposes of the financial establishments.
'Caucasian' can be substituted for 'White' and 'Afro-Carribean' for 'Black'.
The embossed codes can be revised entirely by financial establishments and indeed, new factors may be brought in either as permanent fixtures of the embossing codes or else temporary alternatives.
ADVANTAGES.
It is so simple that it can be put into operation and seen to be working within six weeks of implementation;
It could be set up at a fraction of the cost of other current schemes.
It guarantees a substantial reduction of cards stolen in transit (or at point of destination) by at least 80% and up to 99%.
It further guarantees to thwart forgery of signatures on stolen cards by at least 95% (with a probable 99ç/,) It will be just as effective for charge/debit/cheque guarantee card frauds,
It can be used for Travellers Cheques and Girocheques.
It will even work for transactions via the telephone.
The principle can be applied to, and will work just as effectively in any country in the world.
It does not require any major changes to the present system. In fact it will make most of the current schemes redundant and work hand in hand with other schemes, hence there would not be a need for the re-issuing of existing cards.
It will work just as well for Company, Corporate and Individual/Personal cardmembers.
It could create an opening for the abolition of 'credit limits' for selective cardmembers.
It would greatly reduce present administration costs for the monitoring of credit card fraud.
It is totally flexible such that it can readily be adapted to suit other financial transactions.
It removes the urgency for the prompt notification by cardmembers, of stolen/lost cards. This invariably removes the pressure of 'liability for loss' from the more unfortunate cardmembers (since all cards, stolen or lost, will immediately be rendered useless).
All the cardmember has to inemorise is one code/mark (unlike PINs where four characters have to be memorised).
With all these advantages (and perhaps many more determinable sly by financial institutions), the plan is absolutely infallible and can not, under any circumstance, be defeated by any group or individual.
The biggest advantage in setting up this plan is that the variation to the theme of 'signature-coding' is virtually limitless.
Any form of coding can be employed so long as the card-holder knows his/her code (mark) and the establishment is well briefed on the coding system. The code could even take the form of a verbal response.
If financially acceptable, the plan for 'embossed cards' can be linked with E.P.O.S systems in establishments, in which case the personal data for cardmembers can be logged within the magnetic strip on cards.
Again, the variation to this theme is virtually limitless.
On implementation of the plan, the only possible means of continued fraud, whether by an individual or an organization, requires the active involvement of unscrupulous establishment employees.
There are several ways to counter such eventualities.
1) The coding system can be revised every six months, annually, or at intervals convenient to the respective financial institutions.
2) The financial institutions can make the coding system available to only selective establishments; e.g high-risk establishments; exclusive retail outlets or those that have been pre-vetted for suitability.
3) Even if the coding system is made available to establishments across the board, some establishments will be instructed to make the coding system available only to key/management staff.
The effect of this would be that junior staff, when suspicious, can call on a senior member of staff for card approval thereby removing the need for a phone call to the establishment (except in cases where the floor limit is exceeded).
4) Emboss basic cardmember statistics on card (see Fnibossed Cards).
5) The coding system can be made more complicated by the using a combination of letters (from the surname); numbers from the card account /customer number; or a combination of letters and numbers.
The effect of this will be that a fraudster would have a more complex code to memorise, whereas the establishment has the coding system at hand.
6) Discourage fraud from within establishments by sending out literature (or company reps.) to brief establishments on the issue: such that 'the Coding System remains a property of the credit card companies and information therein should not be divulged without appropriate written consent. Any divulgence without consent will result in prosecution'.
7) Ultimately, the codes can be introduced and incorporated into 'Electronic Point of Sale' terminals gradually and eventually permanently.
The only possible, albeit most unlikely, source of fraud is now limited to coding system operatives.
Claims (7)
1. Method for providing an encodement of a persons individual characteristics physical or otherwise for use as identification when the card is produced for a permitted form of transaction, the said code containing information referring to such personal characteristics as (1) Race (2) Age (3) Build (4) Colour hair (5)
Colour eyes (6) Gender, these being by way of examples
means for either visually or electronically confirming that the user is bona fide
means for further confirmation using an encoded word/sign known to the user in the case of doubt on the part of the transactor
means of each characteristic of the owner being represented on the card by a single character either in letters, numbers or symbols.
2. The method of claim 1 additionally includes the ability to determine whether the user of the card is the authorised user by reading the codes visually unaided.
3. The method of claim 1 additionally including a safeguard in the event of of an unauthorised user being identical in every way to the authorised holder of the card.
4. The method of claim 3 additionally including an extra encoded symbol/letter/number the solution of which will only be known to the authorised user and issuer.
5. The method of claim 1 additonally includes the ability to be able to read the code using electronic means as an option.
6. The method of claim 1 makes the appearance of the users'signature redundant and may not be included on the cards as is presently the case should the issuer so wish.
7. The method of claim 6 removing the necessity of a fraudster knowing what the signature looks like let alone forging it.
Priority Applications (1)
Application Number | Priority Date | Filing Date | Title |
---|---|---|---|
GB9117030A GB2258425A (en) | 1991-08-07 | 1991-08-07 | Credit card fraud prevention |
Applications Claiming Priority (1)
Application Number | Priority Date | Filing Date | Title |
---|---|---|---|
GB9117030A GB2258425A (en) | 1991-08-07 | 1991-08-07 | Credit card fraud prevention |
Publications (2)
Publication Number | Publication Date |
---|---|
GB9117030D0 GB9117030D0 (en) | 1991-09-18 |
GB2258425A true GB2258425A (en) | 1993-02-10 |
Family
ID=10699631
Family Applications (1)
Application Number | Title | Priority Date | Filing Date |
---|---|---|---|
GB9117030A Withdrawn GB2258425A (en) | 1991-08-07 | 1991-08-07 | Credit card fraud prevention |
Country Status (1)
Country | Link |
---|---|
GB (1) | GB2258425A (en) |
Citations (1)
Publication number | Priority date | Publication date | Assignee | Title |
---|---|---|---|---|
GB2198390A (en) * | 1986-02-05 | 1988-06-15 | Michael Ivor Ogle | The use of personal identification on cheques, cheque cards etc |
-
1991
- 1991-08-07 GB GB9117030A patent/GB2258425A/en not_active Withdrawn
Patent Citations (1)
Publication number | Priority date | Publication date | Assignee | Title |
---|---|---|---|---|
GB2198390A (en) * | 1986-02-05 | 1988-06-15 | Michael Ivor Ogle | The use of personal identification on cheques, cheque cards etc |
Also Published As
Publication number | Publication date |
---|---|
GB9117030D0 (en) | 1991-09-18 |
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Legal Events
Date | Code | Title | Description |
---|---|---|---|
WAP | Application withdrawn, taken to be withdrawn or refused ** after publication under section 16(1) |