Internet Fraud and Identity Theft - Essay Example

Internet Fraud and Identity Theft Abstract In this study, threats to transaction over internet by the mean of credit card would be addressed followed by recommendations for their prevention. 1. Introduction Finance and banking are currently accessible to even home computer users [1]. With a range of IT, nowadays users can order highly modified product [2]. For majority ecommerce businesses, the up-and-coming web channel for purchasing, distributing and marketing has created enormous opportunities for reaching out to new markets and customers [3]. Internet is a reasonable development in communications that looks huge in scale as all progress at once [4]. 2. Overview For credit card market, deception is a part of business execution, and is always a challenge 5(Montague, 2004). The internet has initiated a fourth sales channel for companies to reach home consumers or their business customers [6]. Rosen stated that E-business includes products, procedures and internet services [7]. Sanjeev Pandey (2007) in his article stated that ecommerce services deals in heavy transactions. So this attracts hackers. Hackers try ways to extract confidential data like Phishing [8]. The term phishing is well defined by Jim Edwards as Phishing describes a combination of techniques used by cyber crooks to bait people into giving up sensitive personal data such as credit card numbers, social security numbers, bank account numbers, dates of birth and more [9]. As per Röhm, & Herrmann Many organizations are exploiting the opportunities of Internet-based e-commerce solutions, but still most of them are cautious about e-commerce due to security concerns [10]. 2.1. Primary activities Ecommerce basically is about B2B and B2C online sales, online ads, online brokerage and number of related online transactions. As per Jim Warholic, with all the inroads and growth in ecommerce in recent years, security concerns still top the list for both B2B business customers and B2C consumers [11]. 2.2. Payment Modes: Payment modes involved in ecommerce are either Traditional Payment Method or Electronic Payment Method. Andam stated Credit cards mode of payment is very common these days and this study will revolve around credit card only [12]. Almost all e-commerce accept credit cards as primary payment [13]. 2.3. Fraudulent Online Activities The Internet is rising even more dramatically -it's actually much safer to enter your credit card number on a secure online order form than it is to give your credit card to a waiter at a restaurant [14]. Facilitated by the internet, identity theft can manifest itself in a number of ways including phishing, pharming, and other fraudulent schemes [15]. 3. Further Reading 3.1. Precautions If one faces fraud, firstly, he should contact the company for your money back. He should have record of every phone conversation with time; date etc. let them know them that you may notify the authorities. Then report the Securities Division and also the State Attorney General in the state they are located. Fill the formal request form. One should not send the originals of any documents back to the company [16]. Duffy suggested merchants to use tool such as IP geolocation that involves science of using IP location technology and mapping to determine the geographic location of a visitor to a website [17]. Using preventing tools like geo IP solution helps a lot in locating visitors’ geographical locations. It is a great source to identify region, city, zip code etc. But for in the mean while it does not invade user’s privacy. [18] (Source: Geo-location Technologies – A Brief Overview by Dan Svantesson, Faculty of Law, Bond University) The appropriate type of geo‐location technology is geo‐location technologies. It basically interprets Internet Protocol (IP) addresses into geographical locations [19]. ADVANTAGES OF GEO-LOCATION: Tracks and communicates with people even in environments with limited or no GPS. Provides data mapping and precision sensor tracking systems to improve accuracy and consistency of surveys. Allows easy way to exchange real-time information through GPS and mobile phones. DISADVANTAGES OF GEO-LOCATION: Too costly Requires extensive assessment to find the appropriate solution. ADDRESS VERIFICATION SERVICES The Internet Address Verification System (I-AVS) is a business with patent protection to resolve the growing problem of Internet security and fraud [20]. Credit card issuers provide their merchants a tool AVS i.e. Address Verification Services with which merchants check bill address that is submitted if it is in the record of issuer banks. The AVS check is usually done as part of a merchant’s request for authorization on the credit card. ADVANTAGES OF AVS: Verifies the destination address for shipment. Verifies the authenticity of the card holder. Protects both the consumer and business from internet and mail order frauds. DISADVANTAGES OF AVS: Most of the foreign addresses cannot be verified. Customers might face inconvenience in cases when they want a purchase shipped to an alternate address even if they are legitimate. Recommendation to Merchant Suspicious orders that don’t seem concerned about size, color, or large orders that request expensive overnight shipping may be fraudulent. It is advisable to be cautious dealing outside your country. She further advised to use negative lists to check mailing address against a database of addresses associated with past chargeback or fraudulent activity. Catherine emphasized to use free tools provided by Visa and MasterCard that can help merchants with fraud prevention. It is very important to save all correspondence with customers on emails etc to have complete record to use as evidence in future. She directed to have a phonic correspondence as well to clear to gain confidence with new orders [21]. 3.1.1. Recommendation to Consumer Consumer should always verify the authenticity of website where he wishes to make an e-transaction. He can further take guidance from his credit card issuer before proceeding. Consumer is entitled to ask for any authentic proof from a website before making any transaction. Consumer should search company profile over internet in order to find its history and credibility. It is also suggested to have a detailed verbal chat with company’s customer care officer on their universal number. User should verify the country of company’s headquartered and should always check the location of business. It is also very important to check the delivery date and the warranty period with the company as you may need to return the order or replace incase you receive any defected article. It is advisable to initiate with a small transaction with a new company. One should never give his credit card number before running above checks. Every site claims to be authentic and secure but one should verify its authenticity personally before moving on to the payment phase. It is recommended to take credit card issuer in loop at any stage you feel suspicious. Providing Personally Identifiable Information (PII) is compromising identity! If you have been a victim of Internet crime, please file a complaint at www.IC3.gov [22]. Kamthan (1999) suggested in his study that consumers shall gain assurance of the company through an independent and objective initiative such as WebTrust [23]. References [22] (2009, October 27). Intelligence Note. Internet Crime Complaint Center (IC3). Retrieved November 2, 2009, from http://www.ic3.gov/media/2009/091027.aspx [1] Ayers, J. B.. (2002). Making supply chain management work: design, implementation, partnerships. United States of America: CRC Press LLC. [2] Reddy, S., & Reddy, R. (2001). Supply chains to virtual integration. New York: Quebecor World / Martinsburg. [3] Shaw, M. J. (2003). E-business management: integration of Web technologies with business models. United States: Kluwer Academic Publishers. [4] McCarthy, S. P..S. (2001). The art of .COMbat: ancient wisdom for the competitive economy. Canada: John Wiley & Sons, Inc. [5] Montague, D. A. (2004). Fraud Prevention Techniques for Credit Card Fraud . Victoria, Canada: Trafford Publishing. [6] Chesher, M., Kaura, R., & Linton, P. (2003). Electronic business & commerce. London: Springer-Verlag London Ltd. [7] Rosen, A. (2002). The e-commerce question and answer book: a survival guide for business managers. (2nd ed.). New York: AMA Publication. [8] Pandey, S. (2007, December 17). Ecommerce Threats & Solutions . EzineArticles.com . Retrieved October 31, 2009, from http://ezinearticles.com/?Ecommerce-Threats-and-Solutions&id=884278 [9] Edwards, J. (2005, April 18). Cyber Crooks Go "Phishing" . EzineArticles.com. Retrieved November 01, 2009, from http://ezinearticles.com/?Cyber-Crooks-Go-Phishing&id=28459 [10] Pernul, G., Röhm, A. W.., & Herrmann, G. (2009). Trust for Electronic Commerce Transactions. Heidelberg: Springer-Verlag Berlin. [11] Warholic, J. (2008, April 12). Secure eCommerce Tops the B2C Marketing List for eBusiness. Creative Internet Marketing. Retrieved November 2, 2009, from http://marketing.pwebs.net/2008/04/12/secure-ecommerce-tops-the-b2c-marketing-list/ [12] Andam, Z. RU. (2003, May). e-Commerce and e-Business. e-Asian Task Force, UNPD-APDID. Retrieved November 01, 2009, from http://www.apdip.net/publications/iespprimers/eprimer-ecom.pdf [13] Baartse, M. (2009, May 21). An Introduction to Payment Gateways. ECommerce-Guide. Retrieved November 3, 2008, from http://www.ecommerce-guide.com/resources/product_reviews/article.php/3821366 [14] Andry, & Lanford, J. (2004, June 9). Credit Card Fraud: 21 Tips to Protect Yourself. ScamBusters. Retrieved November 1, 2008, from http://www.scambusters.org/CreditCardFraud.html [15] Cacavias, J., Lugonja, A., Messa, M., & Zhanbekov, D. (2006, April 12). Internet Security: Internet Fraud and Identity Theft. The College of Computing at Georgia Tech . Retrieved November 1, 2009, from http://www.cc.gatech.edu/classes/AY2006/cs4235_spring/CS4235%20-%20Internet%20Security%201%20-%20Internet%20Fraud.pdf [16] (2008, August 3). Avoiding Business Opportunity Fraud. Washington State Department of Financial. Retrieved November 2, 2009, from http://www.dfi.wa.gov/sd/businessfraud.htm [17] Duffy , D. (2004, September 1). I Know Where You Shopped Last Night. CSO Online. Retrieved November 2, 2009, from http://www.csoonline.com/article/219574/I_Know_Where_You_Shopped_Last_Night [18] Svantesson, D. (2004). Geo-location Technologies – A Brief Overview. Svantesson. Retrieved November 5, 2009, from http://www.svantesson.org/svantesson20040906.doc. [19] Svantesson, D. (2007). E‐Commerce Tax: How The Taxman. Revenue Law Journal, 17(1), 1-11. [20] Sussman, L. (2005). Internet Address Verification System (I-AVS). Innovative Solutions To Everyday Challenges. 12. [21] Willard, C. (2006). Top Ten Ways to Prevent E-Commerce Fraud. Ballistic Merchant Services. Retrieved November 2, 2009, from http://www.ballisticmerchantservices.com/Top_10_Ways_To_Prevent_E-Commerce_Fraud.asp 22] Kamthan, P. (2009, April 25). E-Commerce on the WWW : A Matter of Trust. irt.org. Retrieved November 3, 2009, from http://www.irt.org/articles/js158/index.htm#conc Read More