Danger: Credit card fraud! Protect yourself.

Credit Card Fraud is a harsh reality of digital age. Though in India, Reserve Bank of India (RBI) has done a commendable job to avoid credit card fraud. Some of the path breaking steps taken by RBI are:

1. Two level authentication for online transactions. 1st level when you enter Credit Card details & CVV. 2nd level authentication is implementation of 3D Secure Code (Verified by VISA and Mastercard SecureCode)

2. Issuance of EMV Chip & PIN enabled Credit Cards

3. Option to select / set limit for International usage

4. Data Security standards for POS Terminals

5. SMS Alert to customer’s registered mobile no for every Credit Card transaction

6. OTP for IVR based transactions

Awesome, Isn’t it. In India, the probability of Credit Card fraud is negligible except due to negligence of user. An example of negligence is that user lost the wallet with Credit Card and in the wallet PIN of Credit Card was written on piece of paper.

Unfortunately, International scenario is not as secured as in India. Most of the credit card frauds are executed offshore i.e. Credit Card information is stolen in India and then the Credit Card is used outside India. Best part is for international transactions, you only need Credit Card No. and 3 digit CVV No. Unlike India, there is no multi layer security authentication/verification. Its quite easy to carry out credit card fraud outside India. RBI or any law enforcement agency does not have any jurisdiction outside India. Last year, person's credit card was used to make international transactions on dubious e-commerce website of African country. Now he has lost all the hopes to recover the amount. The double whammy for him was that he had to pay the amount else his CIBIL Score would have been impacted adversely. Moreover with stricter norms in India, no one can escape under the shield of Credit Card Fraud. The only point of consolation is that if the user prove his innocence by proving that credit card fraud happened due to bank or its employees ignorance/fault/collusion. In this case, Bank will compensate for the loss due to credit card fraud.

 11 most important tips which can help you to avoid Credit Card fraud

Mask CVV No

Immediately after receiving the Credit Card, Remember CVV No and Mask/Scratch the same. You can mask with Permanent marker and than apply whitener coating over it.

Never Store Credit Card information online

Storing Credit Card Information online is most dangerous practice. Its an open invitation to credit card fraud. Recently while booking movie ticket on BookMyShow, the merchant offered me to save the Credit Card Details for next transaction. These e-commerce sites claim highest data security standards but recently Ebay’s 145 mn accounts were compromised so its safe to conclude that “WEB is not a safe place”.

A word of caution: On some e-commerce sites, the option to save Credit Card information for future transactions is by default selected. If you overlooked than without your knowledge, the information will be captured by merchant. The user has to very careful while making online transactions.

Avoid International Transactions, Avoid Credit Card Fraud

It is advisable not to use your Credit Card abroad and even avoid using Credit Card on International E-Commerce websites. If you are 100% sure about the merchant’s credibility & reputation than you may consider. Offline transactions are also risky as Credit Card Skimming is very common at POS terminals in countries like Thailand, Indonesia, African Countries etc

Credit Card Transactions at Petrol Pump

According to recent study, Credit Card Transaction at Petrol Pump is most unsafe. It is one of the favorite location for credit card skimming thus credit card fraud. We tend to handover Credit Card to pump attendant and Credit Card is unattended for 10-15 mins. The probability of Credit Card Skimming is high at Petrol Pumps specially the petrol pumps on highways & remote locations. Crux is that Credit Card should not be unattended and all Credit Card transactions should be in front of you. Secondly, don’t use Credit Card at Petrol Pumps on Highways and Remote locations to avoid credit card fraud.

URL in Browser

Before making any online payment, Please check the URL in Web Browser. Normally the URL starts with “http” whereas secured URL’s  have extra “s” i.e. secured URL will start with “https”. In-fact Google Chrome will show “https” in Green color if the URL is secured and site name will also appear in green.

Reputed SSL Seals & Trust Seals

As a thumb rule, you should make all online transactions only on websites with reputed SSL/Trust seals

SSL Seals: Norton Security Seal, Thawte, Trustwave, COMODO & GeoTrust

Trust Seals:  McAfee Secure, TRUSTe & BBB Accredited.

SSL Seals are more reliable & secure as they suggest Technical Security of Payment whereas Trust Seals are only reputation certification. To avoid credit card fraud rely on SSL Seals.

Use of Credit Card on Public Computer

 Public computers are most vulnerable for Credit Card Fraud. Never ever use Credit Card in cyber cafe, friends place or even in office. Always trust your own Desktop / Laptop for online transactions. Use reputed Anti-Virus, Anti-Malware & Firewall to avoid any data theft.

Credit Card Photocopy as Id Proof / Authorization letter

A Credit Card with Photograph is also accepted as valid Id proof e.g. for bank account opening etc. In case, you booked air ticket for your friend or family member, an authorization letter with xerox of credit card is required. We tend to give xerox of both front and back side of credit card. Some unaware users don’t even hide CVV on back side thus vulnerable to credit card fraud.  Please note that it is not necessary to give xerox of back side of credit card. Only front side is sufficient.

Fraudulent Calls

To avoid credit card fraud never ever trust incoming calls. If you receive any such call than call back bank’s helpline to check the truth.

Credit Card payment through Mobile / Mobile Apps

These days you might have observed that lot many merchants are promoting online mobile apps like RedBus, Flipkart, BookMyShow etc. These apps allow you to make payment over mobile app through Credit Card. Personally, it is not suggested to make any credit card payment through Mobile applications to avoid credit card fraud. In a recent article published in Business Standard, a survey done by Japanese security firm Trend Micro revealed that  39 Payment Gateways, 15 Bank related mobile Apps and other Mobile apps, Shopping apps, Social Networking Apps and Health Care apps used by Indian users are vulnerable to credit card fraud.

Prevention is better than Cure

If the situation demands and you carried out any risky/vulnerable transaction than immediately cancel your Credit Card and apply for replacement of credit card. In short, if you foresee or anticipate any Credit Card fraud than apply for replacement of credit card.
Visit- www.cibilconsultants.com
Source: Secondary

Thieves may E-shop with your credit data!

MUMBAI: The Cuffe Parade police on Sunday detained three suspects from Uttar Pradesh who had conspired and executed a credit card fraud in Mumbai. The accused targeted at least 60 customers of a bank in Navy Nagar and shopped online for goods worth over Rs 13 lakh, said police.

Krishna Prakash, additional commissioner of police, south region, said, "We had earlier arrested an accused, Krishna Pandey, who had come to take delivery of the orders placed on the Web. During his interrogation, we learned that the main accused, Sonu Yadav (21), was hiding in Gorakhpur, Uttar Pradesh. The gang targeted customers of Central Bank of India, Navy Nagar branch." 

The police are in the process of getting the suspects to Mumbai. "A bank official lodged the police complaint after they received several complaints of money being deducted from the accounts of some customers," said a police source. 

"They would order TV sets, fridges, high-end mobile phones, IPads and other costly electronics items online. Their intention was to purchase online and sell these goods immediately. It's still not clear how they got the credit cards' 16-digit numbers and passwords," said an officer. Those detained in Gorakhpur include Yadav, his accomplice Harish Pandey and two others. 

A computer and hard disc have also been seized. Police said that the accused managed to obtain the 16-digit credit card numbers and hacked into the bank's system to get the password. 

Twenty-six-year-old Pandey, the arrested accused, is a class XII dropout. He told the police that he was jobless and came in touch with Yadav, who was also from his hometown. Pandey reportedly asked Yadav for a job to earn livelihood. Yadav asked him to collect products for customers of online shopping. Pandey was promised a commission. He was arrested when he went to take delivery of a TV set. 
               

While a waiting police team caught Pandey, Yadav managed to flee from the spot in Thane last week. The accused have been booked for cheating (Section 420 of IPC) and hacking (Section 66 of IT act). Yadav is said to be a diploma holder in computer studies. The gang first committed the fraud in October and continued till January this year. "We have managed to spot several transactions wherein the accused had placed orders. We have recovered some products and are hoping for more," said the police. 

O P Shrivastav, the bank's assistant general manager asked this correspondent to talk to his deputy Ayyubi, general manager (credit cards). Ayyubi could not be contacted. 

To learn about Identity Theft, visit www.cibilconsultants.com

Source: Secondary

Phishing Attacks!

What could set the alarm bells ringing for the Indian banking system is the revelation that there has been a six-fold rise in phishing attacks on the country's lenders during the last four months alone.

Phishing is a form of internet fraud that aims to steal valuable information such as credit card details, social security numbers, user IDs and passwords for financial gains.

The fraud is executed through spoof emails and fake websites that prompt users to disclose their personal details.

The 24X7 Security Response Lab of Pune-based internet security firm Symantec found that in October last year, there were 20 unique attacks on Indian banks while the figure has grown to 120 attacks as of January, 2008.

"The attacks are now becoming more localised, subtle and target-specific... The increase in the number of attacks reflects that they are getting successful," said Prabhat Kumar, director, Security Response, Symantec.

From fame, the phishers are now turning towards making a fortune, he added.
             

The Symantec lab monitors the complete threat spectrum and malware activity all across the world. It provides support in 14 languages against phishers who are extensively using sophisticated methods to install spyware, Trojans, worms and viruses.

But, it is not actually a security breach for the bank.

"The banks have put in the best possible security but it is the unsuspecting user on whose back the phishers enter the system," Singh said.

The latest Internet Security Threat Report by Symantec had ranked Mumbai as the most notorious in India in terms of phishing sites with 38 per cent, followed by New Delhi with 29 per cent.

Even Tier-II cities like Bhopal, Surat, Pune and Noida too had reports about phishing site activity.

"Surprisingly, a large number of home PC users do not even have a basic security feature," Singh said.

The report highlighted that the malicious code in India included 57 per cent worms and 21 per cent virus attacks but even complex threads like Trojan made for about 20 per cent of the attacks.

Recently, leading private sector lender HDFC Bank had filed a police complaint against a "money mule" scammer. The accused had used a bank customer as a mule to transfer money, acquired through phishing attacks, to different accounts.

Even the Reserve Bank of India (RBI) had advised the public not to succumb to the temptation of fictitious offers of large funds through e-mails from unknown entities.

"Members of public should also not make any remittance towards participation in such schemes/offers from unknown entities," it had said in a recent notification.

The RBI has issued the warning to caution individuals who initially receive tempting offers of large funds on various pretexts from unknown overseas entities through e-mails and letters and are later requested to remit a small amount as commission for transfer of the money.

To learn about Identity Theft, contact www.cibilconsultants.com
Source: Secondary

Improved Technology Increases Vulnerability To Cyber Crime, Cops

Technology has made life easier for all, but this has also increased vulnerability to cyber crime. For instance, with smartphones and easy accessibility of the internet on it, Thane cyber crime cell has seen an increase in cyber crimes.

Cyber crime includes crime done through mobile phones, social networking sites, credit and debit card transaction.

On the condition of anonymity, an officer from cyber cell said, "Though the internet was introduced to minimise time, today many people are misusing it. With young children getting access to smartphones easily, they start surfing various sites and in turn indulge in unlawful activities."

"Parents should not give mobile phones to kids unless there is some emergency," he adds.

Specifying the types of crime committed through the internet, he says, "Facebook and bank fraud casea are on the rise. People make fake profile and then lure someone for cash and for other purposes. Crimes through WhatsApp and other software are, however, very less."
                 

He added, "There was a juvenile boy who used to call on unknown number and when we identified him he accepted watching porn clips on his father's cell phone. As his father was not tech savvy, he was not aware of what his son was up to. The matter came to light when one day this boy called a random girl and asked her for sexual favours. The girl approached the police and got the boy arrested. He was later sent to remand home."

Deputy commissioner of police (cyber cell) Sudhakar Pathares said, "The cases have increased in the last three years. By the time we come up with an efficient way of detecting the culprits, they come up with the new a tactic. We are trying to curb such activities, but technology is growing at a faster rate and it is not easy to control them."

He added, "We have tracked so many cases and are trying to minimise cyber crimes, but with changing technology and new software it's a challenge. For instance, on WhatsApp allows you to seen when the person was last seen. This helps us detect some cases."


To learn about Identity theft, visit- www.cibilconsultants.com
Source: Secondary

Online banking frauds can come to an end by new software

Scientists have developed a new software to prevent malware from sending spam emails and instant messages while blocking unauthorised money transfers.

Researchers at Georgia Tech have created a prototype software, Gyrus, that takes extra steps to prevent malware from sending spam emails and instant messages, and blocking unauthorised commands such as money transfers.

Current protection programmes might recognise the original user's intent to send email, transfer money or engage in other transactions but cannot verify the specifics such as email contents or amount of money.

Without context, it is impossible to properly verify the user's full intent, regardless of whether the software is protecting a financial transfer, an industrial control system or a wide range of other user-driven applications.

Gyrus is a transparent layer on top of the window of an application. The user experience with the application will be exactly the same as when Gyrus is not installed or activated.

Of course, if Gyrus detects that user-intended data has tampered with, it will block the traffic and also notify the user.

The research is based on the observation that for most text-based applications, the user's intent will be displayed entirely on screen, as text, and the user will make modifications if what is on screen is not what he or she wants.

Users help Gyrus do its job by establishing pre-defined rules that help the software determine whether commands - authorised or not - fit with established user intentions.

The idea of defining correct behaviour of an application by capturing user intent is not entirely new, but previous attempts in this space use an overly simplistic model of the user's behaviour.

For example, they might infer a user's intent based on a single mouse click without capturing any associated context so the attackers can easily disguise attacks as a benign behaviour.

           

Instead, Gyrus captures richer semantics including both user actions and text contents, along with applications semantics, to make the system send only user-intended network traffic. Gyrus indirectly but correctly determines user intent from the screen that is displayed to the user.

There are two key components to Gyrus' approach. First, it captures the user's intent and interactions with an application. Second, it verifies that the resulting output can be mapped back to the user's intention. As a result, the application ensures accurate transactions even in the presence of malware.

To learn about Identity theft, visit- www.cibilconsultants.com
Source: Secondary

Financial services in danger because of cyber crime

Cyber crime is a “growing threat” globally and the second most commonly reported economic crime affecting financial-services firms, according to a survey by PricewaterhouseCoopers.

It accounted for 38% of criminal incidents for financial companies compared with 16% in other business sectors, the accounting firm said in a report.

About half of the financial-services respondents said the potential risk of cyber attacks has risen over the past 12 months compared with 36% in other sectors. “Cyber crime puts the financial sector’s customers, brand and reputation at significant risk,” Andrew Clark, forensic services partner at PricewaterhouseCoopers said in the statement. “Regulators are increasingly viewing cyber crime as a key area of focus and financial institutions are expected to have appropriate systems and controls in place.”
                  

Cyber crime involves the use of computers or the internet and includes the theft of personal information, industrial espionage, reputational damage, financial theft and the disruption of services. About 29% of financial-firm respondents didn’t receive cyber security training, PricewaterhouseCoopers said.

Asset misappropriation such as embezzlement and deception by employees remains the most popular way of committing fraud in an organisation, the survey found.
To learn about Identity Theft, visit www.cibilconsultants.com
Source: Secondary

SIM card block? It could be online fraud!

Online banking cheating cases on the rise in city, warn experts

A 35-year-old software engineer working with an information technology (IT) company in Chinchwad got an SMS that her ICICI Bank debit card had been used to make purchases worth Rs93,000. She almost fainted because she had never made any such transaction. But her nightmare did not end there. A short while later she received another SMS saying her debit card had been used to make another purchases of Rs 5,000.

The cases of online banking and mobile transactions are on the rise in the city. The officers of the cyber crime cell (CCC) of Pune police claimed people are not aware about fraudsters and their tricks. As a result, the cases have increased in the city.

The CCC officers said that people do not have adequate knowledge of safety and security measures for online transactions. They said as many as 60 such cases are being registered at different police stations in the city.

Fraudsters are using the technique of blocking the SIM card of the victims’ cellphones to ensure they don’t get alerts from the bank. Senior police inspector Sarjerao Babar of CCC told dna, “The present modus operandi of the fraudsters is to block the SIM card with the help of the telecom company employees. Thereafter, they send an application to the telecom company for a new SIM card on the victim’s name. Once the fraudsters get the new SIM card, they get the bank alerts.”

On that basis, fraudsters submit fake know your customer (KYC) forms on the name of the victim and open new accounts in their name and make transactions. “Thereafter, the fraudsters immediately transfer money to their different accounts,” Babar said.

Analysing the causes for the rise in number of cyber crimes in Pune, Babar said, “As more people use the Internet and cellphones for banking, the number of people falling prey to cyber crimes is increasing. People carrying out bank transactions using the Internet are falling prey to economic offenders on the prowl.”

Deputy commissioner of police (cyber) Sanjay Shinde told dna, “People do not have adequate knowledge of safety and security measures to be taken while carrying out online transactions. We have been trying to spread awareness by giving safety tips in dos and dont’s format. However, many Internet users do not pay enough attention to our advice. In recent cases, we have observed that if the SIM card was blocked, the victims could have contacted the nearest telecom office and get a confirmation on it, but they did not. As a result, the fraud took place.”

                       
Shinde said they had asked bank authorities to create awareness among customers about the latest security measures. “But the banks are slowly proactive in security aspects related to mobile banking,” Shinde said.

Besides, a major chunk of cyber crimes pertain to credit /debit card frauds.

Banks authorities asked to step on it

Deputy commissioner of police (cyber) Sanjay Shinde claimed that they had asked bank authorities to create awareness among customers about the latest security measures and to be vigilant during submission of KYC forms to weed out fake accounts. “But the banks are slow in responding to security aspects related to mobile banking,” he said.

Online shopping tips:

1.  Shop with merchants you know and trust
2.  Check whether the shopping website is secure
3.  Be cautious of unsolicited phone calls or emails from merchants
4.  Read merchant’s refund and exchange policies before making any purchase
5.  Do not share your password
6.  Always print and keep the order confirmation documents
7.  Read the privacy statement
8.  Never enter your personal information on a pop-up screen.

Internet Banking tips:

1.  Keep your passwords/PIN codes safe and memorize them
2.  Check if the online banking website is secure
3.  Log out immediately after you complete your online transaction
4.  Do not copy or click on any links that are not from a known source
5.  Do not respond to emails asking for personal or banking related information
6.  Read privacy and policy statements to ensure that no unauthorized transaction has taken place
7.  Check your account statements regularly

To learn about Identity Theft, visit- www.cibilconsultants.com

Source: Secondary

How does medical debt affect your credit score?

Even when you have health insurance, medical costs can add up, forcing you to borrow in order to pay your bill. While it would be nice to think that the debt you incur for health care costs won’t ruin your credit, the reality is that, like any debt, can impact your credit score.

“Medical debt that appears on your credit report normally hurts your credit score, no matter the reason for how it got there. Medical debt can be reported by the providers, collection agencies, and through public records if the creditor files suit in court.”

Medical debt and your credit score

How medical debt impacts your credit score also depends on the scoring model being used to determine your score. 
Medical debt that has been sent to collections will have a smaller impact on your score than non-medical collection accounts.
However, “Not every lender uses the most current version of credit scoring models.” This means that your medical debt might still count against you, depending on how it is reported, and which scoring model and version of that scoring model are used. In general, though, it’s safe to assume that your medical debt is likely to have some impact on your credit score, especially if you have missed payments. Any debt account that isn’t kept up to date will drag on your credit score.

                                                

How to reduce the impact of medical debt

“The best way to keep medical debt from dragging down your score is to keep it off your consumer report. In many models, paying off your medical debt can also prevent it from having a big impact on your score. The good news is that medical debt is in a class by itself when it comes to your credit report and your score.
The information on your credit report appears there because it has been reported by a creditor or service provider. This means that if you can work out a payment plan with your provider, and you stick to the terms, there is a good chance that it won’t be reported to the credit bureaus. “Most providers will not report medical debt when consumers are actively communicating, and making an earnest effort to resolve open claims issues with insurers, and paying down the balance.” 
Many hospitals and other health care service providers offer payment plans for expensive procedures. Additionally, you can usually find reasonable payment terms if you have a high deductible. The problems come in when you stop making payments as agreed and the provider feels like the account needs to be turned over to a collection agency. “Most providers do not have systems to report, but collection agencies do.”

Also, be aware of the difference between organizing a non-loan payment plan with your provider and the “payment plans” offered as loans through third parties. These types of plans are commonly offered by dentist offices and vision specialists. You are referred to a payment plan, but this plan is actually set up through a third-party and is a special financing arrangement. In some cases, these arrangements are reported as the loans they are, and appear on your credit report. Understand the distinction before you agree to a payment plan.

Paying off your medical debt can also reduce the impact on your credit score. Increasingly, there is pressure for credit scoring models to stop “counting” medical debt — even collection agency medical debt — once it has been discharged. Make an effort to pay off your medical debt, and you can reduce its impact on your credit score.

Watch out for identity theft

Finally, be on the alert for fraudulent medical debt. Medical ID fraud is a growing problem. Someone might use your information to receive health care, and then skip on the bill. This results in medical debt in your name. Check your credit report regularly for these types of fraudulent accounts. If you notice billing for a medical procedure that you didn’t have, follow up and dispute the account. You will likely need to prove to the health care provider that you weren’t the one who received the treatment. This can be difficult to clear up, and it’s even harder the longer the account sits, so make sure to check your credit report regularly for errors.
Like any other debt, medical debt can impact the way financial companies view you. Your best defense is to keep on top of the situation, and try to avoid falling behind.

To learn more about Identity Theft visit www.cibilconsultants.com
Source: Secondary

Days Past Due (DPD) in CIBIL Report

CIBIL Report is X Ray of one’s credit health. It is must that credit health should in good shape. A good credit health in turn is critical for your personal finance / financial health. For example, if you have low CIBIL score in CIBIL report then you cannot avail Home Loan. What it implies is that you cannot own your dream home till you save enough to buy house without Home Loan. This scenario seems impossible because of high cost. As we know that any default in payment impacts your CIBIL score negatively. Sometimes through intelligent and timely intervention, we can control the damage to CIBIL Report without much efforts. One such intervention is managing Days Past Due or DPD entries in CIBIL Report.

What is Days Past Due in CIBIL Report?

In CIBIL report, you must have observed entries like 000 or STD under each credit account reported to CIBIL by the financial institutions. These entries are recorded in 2 dimensional matrix o fMonth and Year for each credit account. In layman terms, Days Past Due or DPD means for how many days the payment was delayed for that particular month. In following example, entry for April’2010 is showing DPD of 025 which implies that payment for April’2010 was delayed by 25 days from customers end. In financial terms, Days Past Due in CIBIL Report reflects the ability of a borrower to pay the amount due on time. Any other entry besides 000 shows that borrower is not able to manage his/her finances well which impact CIBIL report negatively.

Days Past Due (DPD)

In the above example, except for 000 or XXX other entries like 025 or STD will impact your CIBIL report negatively. There is a common misconception that entry of STD is OK, which may or may not be true. STD means Payment is cleared within standard period of 90 days which may imply there was delay in payment. Some lenders ignore STD entries but few may consider it as delay in payment. As per CIBIL, STD entries in CIBIL report should not be viewed negatively. XXX means that data for that particular month is not reported by the financial institution which is perfectly OK. Other possible entries in this table are

SUB (Sub Standard): Account is NPA for upto 12 months. Account is declared NPA (Non Performing Asset) if payment is not cleared for more than 90 days from payment due date.

DBT (Doubtful): Account is Sub Standard for 12 months

LSS (Loss): Lender has declared and booked LOSS. Account is tagged as uncollectible i.e. payment cannot be collected from defaulter.

Days Past Due history is available in CIBIL Report for 36 months. If the credit account is more than 36 months old then most recent 36 months details will be available in CIBIL report. In case of closed accounts, Last / Preceding 36 months entries are reported to CIBIL database.

One of the most common mistake in case of payment default is to close or settle the account. All hopes are lost and borrower stop making further payments. This situation can be avoided in most of the cases. Mr. Ravi. Last year Mr. Ravi lost his job and skipped credit card payment for 3 months. He pressed panic button as DPD entries of 90 days, 60 days etc reflected in his CIBIL report. General feeling was that all is lost. After getting new job he thought that now there is no point making past payments as he is already defaulter. Due to ignorance, Bank also pressed panic button and requested Mr. Ravi to settle the credit card amount due and close the account.

This situation could have been handled in a better way by the bank. The solution should be win-win situation for both the parties when default is due to unforeseen circumstances & not intentional.

There is another misconception that credit account details in CIBIL is maintained for 7 years but it is not 100% true. In case of payment default, the defaulter console himself that entry will be deleted after 7 years from CIBIL report. This is the biggest mistake. Fact of the matter is that credit account entry is maintained for 7 years from the date the account was last reported by the financial institution. In case of payment defaults or settlement, Banks don’t close account and keep updating on regular basis therefore this period of 7 years keeps extending with each reporting from bank. The idea is to cause maximum damage to defaulter.

If Mr Ravi would have settled his credit card account, an irreparable damage could have been done to the CIBIL report. Right step to take is to approach the bank and restructure the total credit card amount due. Bank agreed and restructured the amount due in 6 EMI’s. Bank also agreed to keep credit card active if future payments will be on time. He should also make all payments on time from date of restructuring. In this case objective to keep credit card account active was to phase out DPD entries in 36 months i.e. to completely remove DPD entries from CIBIL report. All entries from date of restructuring will be 000 as Ravi is making all the payments on time. Moreover his CIBIL Score improved drastically in last 12 months as all recent payments are on time.

By handling situation differently i.e. managing DPD entries, the damage to CIBIL Report was minimized and CIBIL Score improved at much faster pace. Whereas settlement would have caused more damage as bank could have been reported account as “SETTLED”. DPD entries against “settled” account are freezed for next 7 -10 years. Sometimes the intent of borrower is not to default intentionally but due to improper guidance & hand holding from bank, he unintentionally cause permanent damage to his CIBIL report.

It is advisable to explore all possible scenarios before opting for settlement and always regularize payment ASAP as you can in case of default. Provided the intent of borrower is not to default and commit financial fraud. You may approach bank and explain the genuine reason for default. Do remember that for bank, yours is one among lakhs of cases but for you, its your lifeline to avail future credit.
Visit - www.cibilconsultants.com
Source-secondary

Prevent Identity Theft- Follow the Tips by Experts

Identity Theft is one of the by-product of technological evolution. World was more secure when there was no internet, photocopier or scanner. Identity Theft can be disastrous for any individual. Recently one lady's Home Loan was rejected because of low CIBIL Score. She was advised to pull out CIBIL Report. When  checked, her CIBIL Report, found that Rs 200000 outstanding was written off against her credit card. She never applied for this credit card. The credit card was issued at her old Delhi address before she shifted to Mumbai. It was a clear case of Identity Theft. 
Worst part is that complete onus is on an individual to prove that he is victim of Identity Theft. 

Normally on internet, the discussion on Identity Theft revolve around Online Identity Theft i.e. through internet. Offline Identity Theft is more dangerous and easy to execute. Secondly, there is more organized mafia whose job is find potential victims for Identity Theft. Mostly observed that online Identity Theft is because of mistake from user end which could have been easily avoided but scope of offline Identity Theft is vast. In this post we will discuss tips and tricks to prevent offline identity theft.

1. Photocopy of Documents: It was quite interesting episode, of one of TV serial, lady A gave her documents for photocopy and told shopkeeper that she will collect in 2 hours. Somehow fraudster steal the copy of documents. Documents were misused by fraudster to get job in Lady A’s  name. Fraudster committed fraud in her company and poor Lady A was caught based on documents. Though police finally caught the real culprit but imagine the trauma undergone because of Identity Theft.

Photocopy shops are soft and easy target for identity theft. With advancement of technology, photocopy machine can retain scanned copy of documents. It is advisable to take photocopy at home through printer only. If it is absolutely necessary to photocopy from outside because of volume then you should get it done only from known shopkeeper. You can also keep extra copies at your home for emergency.

2. Handover Documents only to Bank Executive and Take Acknowledgement: During our day to day financial transactions, we have to handover some imp documents to bank like PAN, Address proof etc. A businessman handed over his originals to employee and send him to bank for any such work. Yes, it is not feasible for businessman to do everything on his own. At the same time it is suicidal to handover either original or photocopy to 3rd party. It is advisable to handover documents only to authorized bank executive and insist on acknowledgement. In relevant document, also mention the details of documents submitted by you with the bank.

3. Watermark: One of the critical step to safeguard your identity is to watermark all the scanned documents and then take photocopy. Only use watermark copy for any future use. Watermarked copies are very difficult to temper with. Watermarking can be done using software like pdf writer or image editor. Though its a tiring job but you have to do only once in a lifetime.

4. PAN: Obtaining a PAN is one of the simplest govt process in my opinion. Last year CBDT madeverification of originals mandatory for PAN to reduce PAN based frauds. Analysts termed it as “Step Back”, “Return of License Raj”, “Bottle Neck” or “Retro Grade” step. Being an election year and under pressure from govt, CBDT withdrew the circular. PAN is lifeline for doing any financial transaction and process is so lax that anyone can manipulate.

PAN is one of the most misused document for financial frauds and is heart & soul of identity theft. PAN should not be issued / re-issued without verification of originals even if it cause inconvenience to general public. People don’t realize that its for their benefit only.

5. Inquiry in CIBIL Report

PULL out your CIBIL report atleast once in 6 months or preferable once every quarter. One of the important section to look out is “Inquiry Information”. Please check any suspicious entry in the report e.g. if bank A has posted entry related to Enquiry for issuance of Credit Card with credit limit 1 lakh. In case,  you have not applied for any such credit card then immediately you should bring it to the notice of the bank. Prevention is always better than cure and checking “Inquiry Information” in CIBIL Report is one such prevention.

6. Social Media: . An open invitation to Identity Theft, social media is one of the most dangerous place if not handled responsibly and with caution. Even Afghanistan, Iraq and Somalia will rank after Social Media. Social Media is emerging as a new crime hub both for financial and non-financial crimes.

“Too Little on Social Media can be Too Much”. It is advisable to draw a thick line between privacy and social interaction before you post anything through social media channels. Privacy should not be compromised at all and at any cost. Remember for a small mistake you have to pay heavy price.

7. Letter Box: In the age of internet and email, people don’t check their letter box for months. It is quite visible from overflowing letter boxes next to mine in my apartment complex. Its again an open invitation for Identity Theft. We receive bills and statements through snail mail and anyone can easily steal your identity using these document. It is advisable to check your letter box regularly to prevent identity theft.

8. Change of Mobile or SIM: Now a days most of the people change their mobile every 6 months. Also many of us have habit of storing important information on mobile like bank account no, PAN, Passwords, PIN etc. As mobile is personalized device therefore danger of Identity Theft through mobile is manifold. It is advisable that all the data from mobile should be deleted when you are changing it. Mobile should be restored to factory settings. Remove micro SD card and also remove all installed applications. Log out from all accounts sync with the device and most importantly remove SIM card (if you are opting for Nano SIM in new device).

9. Purpose of document: Whenever you are handing over photocopy of your documents, don’t forget to mention the purpose for which the documents is being handed over. For example, if you are submitting document for Ration Card then don’t forget to mention on Watermarked document “Purpose: Application for Ration Card” in either Red or Blue Pen. It will help to prevent identity theft. Secondly, if fraudsters realize that particular person has taken necessary steps to prevent identity theft then they don’t mess around. Only people caught unaware become victims of identity theft.

10. Date of Birth: Besides PAN, DOB is important piece of information for Identity Theft.  Birth Certificate was not mandatory earlier but now it is also one of the important document.

11. Beware of Freebies: Last but not the least and most crucial. Don’t share your DOB, mobile no, name etc through feedback forms in Restaurants or to participate in some lucky draw. You can politely say NO. There are no free lunches in this world but others should not have free lunch at your cost.

Learn more about identity theft at www.cibilconsultants.com
Source-secondary

Banks seeking insurance cover because of rising online frauds

MUMBAI: Indian banks are increasingly seeking insurance cover against fraudulent online transactions, including those involving credit cards, as a rising use of plastic money and the ease of Internet business potentially increase lenders' exposure to cases of data breach.

Data from insurance companies show that large banks are opting for policies worth Rs 500 crore to shield against fraud, including online, while mid-sized banks are going for policies in the range of Rs250-300 crore. "Demand for insurance policy against phishing, skimming and Internet hacking has gone up in the last one year," said TR Ramalingam, head of underwriting at Bajaj Allianz General Insurance. "Inquiries have gone up and we are working on how to price the product and working on the wording."

               

Earlier, insurance policies did not include computer-related frauds, but now insurers expect it to be big in coming days. The premium, which depends on several factors, ranges between 1% and 2% of liability the bank is looking to insure. In 2012-13, domestic banks lost Rs17,284 crore on account of fraud, according to information obtained through the Right to Information Act. During the period, 62 banks filed a total of 26,598 cases related to online frauds. The situation has compounded the woes of the bank sector where lenders are facing huge non-performing assets. "The policy covers cyber extortion and breach of data privacy," said M Ravichandran, president, Tata AIG General Insurance. "There is a lot of talk around cyber insurance and people are actively looking to secure these exposures."

While companies like Tata AIG have underwriting capabilities for these policies, for others, it is reinsurance driven. Cyber extortion policy pays a ransom to a person who has hacked into the bank's website with a threat to divulge, destroy or steal confidential information. Last year, ATM cards of a leading private sector bank's customers were skimmed and about Rs15.48 lakh stolen from accounts.

If your Credit Score have been hampered because of Identity Theft, contact us- www.cibilconsultants.com

Source: Secondary

Catching a Credit Con

When did you last update your e-mail address and phone number with your credit card issuer? Many do not even bother. Now, imagine being billed for fraudulent purchases made from your card.

What do you do? First, of course, you inform the card issuer, who will probably ask you to fill a declaration form. Doing this quickly is important as, according to rules, if the issuer isn't informed within 30 days of you receiving the statement, it is assumed that you have accepted it as accurate. So, if you were out of station and didn't notice it on time, you would be legally bound to pay.

Of course, if you had updated your contacts with the card issuer and got an alert, which comes within minutes of the transaction, you could have called up the issuer immediately and saved yourself the loss.


"Important communication, these days, happens through mails and phones. So, it is crucial that the customer keeps his bank updated so that he can be reached any time for checking a transaction's authenticity." 

COMMON CATCHES
In India, according to a provision in credit card contracts, the card-issuing company isn't liable for any fraudulent transaction unless the customer files a report immediately. Once reported, the card holder is no longer liable. So, be alert and look out for the red flags. Card frauds range from purchases made on lost or stolen cards to phishing, identity theft and traps set up through unsecured Internet transactions.

Skimming or cloning is something to be cautious about, especially when travelling abroad. In this, data in your card's magnetic stripe is recorded when swiped at a machine. This information is then used to make duplicates. It can happen anywhere, at a petrol pump or a restaurant. So make sure the card is swiped in your presence.

"To minimise risk, banks also advice customers to replace cards after trips."

Do you use your card online? Beware of cyber swindles. These involve unauthorised use of card details, such as the card number, the Card Verification Value (three-digit code printed on the back side of the card), to make purchases online.

"One should register for online transaction passwords such as Verified by Visa or MasterCard Secure Code and avoid using public computers. Also, make sure that the transaction happens through a secure website, which begins with HTTP."

Fraudsters also try account takeovers and identity theft. This happens in two ways. One, a cardholders information is stolen and used for transactions where the card's physical presence isn't required, such as online purchases. Two, by placing a request for a new card using the stolen information. Monitoring your credit card report is your best defense.

"Check for unusual transactions, especially small ones, as fraudsters make these to check the card's validity."

Last but not the least, do not fall prey to phishing mails (that appear to be sent by an institution you deal with but are not), SMSes or calls.

FRAUD CONTROL
Usually, banks have dedicated transaction monitoring units and fraud detection systems to analyse suspicious patterns. So, if two transactions are made from different countries with the same card within a short period, the system will highlight this. However, it helps if the customer is also cautious. For instance, opting for cards with signature lamination and a photograph, registering for transaction alerts and transacting only through secured websites are common precautions.

If you are a frequent user, it may make sense to go for an insurance cover to take care of liabilities from loss and misuse. Banks usually have tie-ups with insurers. General insurers also offer standalone credit card policies, which cover all cards held by a customer under one policy. One alert to the insurance company can block all your cards, limiting your loss.

FOR YOUR GRIEVANCES
The RBI has appointed an ombudsman for redressal of complaints which your bank has failed to respond to satisfactorily. A bank must respond within 30 days from the date you lodged the complaint. In case of wrongful billing, the card company should provide documentary evidence within 60 days. If unsatisfied, the cardholder can go to the ombudsman.

Learn more about identity theft at www.cibilconsultants.com

Source- Secondary