RIYADH, 6 July 2007 — Credit card fraud has become a growing phenomenon in the Kingdom with increasing reports of transactions that have taken place in far-off places such as Japan, Britain, Sri Lanka and Thailand appearing on people’s statements.
One white-collar worker in the city was shocked yesterday to note that a sum of SR22,000 had been debited from his credit card account for nine purchases made in Thailand, while he was in the Kingdom. “I am in the Kingdom and my card has been used for purchases in Bangkok,” said Minhaj (not his real name), adding that he only discovered the fraud when he made a random check on his account through phone banking.
According to Minhaj’s credit card statement, nine purchases had been made continuously during the past three days. Besides using his card in the Kingdom, he said he had only previously used his card in Colombo. Minhaj’s bank has agreed to reimburse the loss and give him a new credit card number.
A Riyadh-based media specialist received his monthly bank statement and discovered that someone in London had made four purchases worth SR4,500 using his account. After complaining, the bank called for a full copy of the man’s passport to ensure he had not traveled to the UK during that period and promised to rectify the record after formal investigations. The man told Arab News that he had last used his card in Kuwait and that the illegal transactions took place in London, four days after his return to the Kingdom from Kuwait.
A schoolteacher, whose husband works at a Riyadh-based bank, faced a similar experience when someone made purchases worth SR2,000 in Sri Lanka.
Commenting about such frauds, Priyan Attyagalle, chief executive officer for American Express, said that some of these cards are cloned in foreign countries when cardholders present their cards at stores. He added that in order to prevent such fraud, cardholders should take extra care of their cards when making purchases.
“The cardholder should insist that the card must be within his sight and should ensure that it is swiped for the particular purchase,” he said, pointing out that card users must exercise extra care when traveling in high-risk countries.
High-risk countries include Malaysia, Indonesia, Thailand, Taiwan, the United Kingdom, Spain, Italy and Sri Lanka.
According to a senior banker, every bank has a fraud management department to monitor credit card transactions. “The bank immediately contacts the credit card holder on his mobile phone when it receives a suspicious transaction for authorization,” he said, stressing that card holders should cooperate with banks by promptly responding to calls.
In a recent incident, a transaction for SR20,000 in Japan was averted when the bank gave a timely call to the cardholder and found him answering the call from the Kingdom. “Some banks issue credit cards with limited credit facility solely for online banking purposes, which prevents hackers from taking fancy amounts from credit card accounts,” said a senior banker, adding that cardholders must use their cards only at reputable and verifiable companies or websites.
“The cardholder should also frequently monitor his or her card account. Industry sources estimate that losses associated with credit card fraud in the world are in the billions of dollars annually,” he added.
“It will be a few years before all credit cards use the chip and PIN system. So until then, vigilance is the only defense,” said Ian Spencer, head of Barclaycard Northampton. The chip and PIN credit cards will require a PIN number to complete transactions, making card cloning near impossible. “It will wipe out 50 percent of card fraud,” added Spencer.
