The problem…

Credit card fraud involves identity theft to use someone else’s account information as a source of funds in a transaction. Although fraudulent transactions only account for 0.1% of all credit card transactions, they result in billions of dollars lost every year by banks, customers, merchants, and credit card companies. Credit card numbers can be stolen through malicious websites or company database hacking. In some cases, the victim’s credit card number is stolen by store clerks during the processing of legitimate transactions.

How the store clerk steals credit card numbers…

These criminal store clerks can steal credit card numbers during the processing of legitimate transactions either by photocopying receipts, stealing receipts, or simply copying down the credit card number. The criminals are subsequently able to use these stolen credit card numbers to make fraudulent purchases.

The slow pace of investigation…

It often takes law enforcement officers months to identify the criminal and the origin of the scam. Often the investigations lead nowhere.

The solution…

One fast way to locate the source of the scam is building a network graph based on the history of fraudulent transactions. A network of customers and merchants connected by transactions establish patterns that can be used to find the criminal.

The nitty-gritty…

I have developed a web application that shows how credit card transactions can be sifted through to display a network graph with the possible credit card number theft hub in the center surrounded by the victims who are in turn further surrounded by fraudulent transactions.

Say for example, two people ‘A’ and ‘B’ dispute transactions and the transactions are identified as fraudulent, we next check the previous credit card purchases for both ‘A’ and ‘B’ and determine whether they have made legitimate purchases at a common store. If such a common store is found, it can be suspected as the hub for the credit card number theft leading to further investigation.

To review the ‘Credit Card Theft Hub Investigation’ application, please click here.

I would love to hear back from you. Please email me your feedback. Thank you so much – Mayha.