Monday, June 23, 2008

Pune cops unearth Rs 1 crore credit card fraud, arrested four persons

Pune police unearth end a major credit card fraud by arresting a gang of four persons for cheating people and creating duplicate credit cards. As per police reports the gang is suspected to have cheated over 30 customers of Hotel Le Meridien of Rs1 crore.
The gang of four was headed by 24 year-old Asif Zaidi Mirza of Borivli, Mumbai, only a HSC pass, but technically quite savvy. The other accused, Wasim Salim Patel (21) of Sainik Nagar in Yerwada was a cashier at Chingari Restaurant in Hotel Le Meridien. The other two accomplices have been identified as Ubed Ajmat Sayyad (26) of Mumbai East and Bharat Tansukhbhai Soni (28) of Goregaon, Mumbai.

Senior police inspector Sunil Pawar said the accused used devices like “credit card skimmer” and “credit card reader” for stealing the credit card details of the Le Meridien customers, which they had purchased from a Nigerian national for Rs 60,000.

“When a customer gave credit card for paying the hotel bill, Patel used to swipe the card using the skimmer whereby the credit card details were recorded for later use,” said Pawar.

“The accused then copied these details on the magnetic strips of blank or blocked plastic cards using computer technology. In this manner, they prepared at least 33 credit cards of 27 multinational and international banks. These credit cards were circulated among the gang members, who used it for shopping costly items,” he said.

Pawar added “The fraudsters were mostly targeting customers having platinum, gold and corporate credit cards who have credit limit of about Rs 15 lakh in India”.

The fraud came into notice a few days back when Sunil Nade (33), manager of Financial Resource Management (FRM) division of Citibank’s East Street branch lodged a complaint with the Bund Garden police station.

Nade in his complaint stated that he and three of his bank customers had gone to Hotel Le Meridien on May 7 for dinner during which time the accused Soni, Asif and Ubed were also present.

The police alleged that when Nade gave the credit card for making the payment, the cashier Patel either stole the credit card details himself or passed these cards to his partner in crime for the purpose. Then they made the duplicate card with the details and used for shopping goods worth Rs 10 lakh.

Nade and the other three bank customers were shocked when they discovered that such a huge amount was withdrawn from their account without consent between May 7 and June 13. Hence they reported the matter to the police.

With a timely action, the crime branch sleuths were able to first nabbed Soni at Mumbai. Later, they arrested Asif, Ubed and Patel. Police have seized the skimmer, credit card reader, laptop and 20 duplicate credit cards.

On investigations it was revealed that Patel was working at the hotel for last three years. Asif, the gang leader, was taking as his cut 50 per cent of the money made from the fraud. “It is very easy to identify a duplicate credit card. Still some shop owners have allowed shopping through such cards. We suspect that fraudsters paid some part of their income through the racket to the shop-owners,” said Pawar, sub inspectors N V Avhad and R M Gaikwad assisted Pawar in carrying out the investigation.

Wednesday, June 18, 2008

Police arrested student for international credit card fraud

Chennai police arrested a 20-year-old final year commerce student Bharat Raj Purohit for allegedly cheating credit card holders abroad of Rs.400, 000.
Police arrested Purohit from a northern suburb on the complaint of, an online trading company.

A police official in the cyber crime department told the student knew about the loopholes in the trade of the two people based in Mumbai and Ahmedabad.

Purohit mainly cheated credit card holders of US, Canada and Russia after falsely obtaining secret access codes. He purchased computers, music systems and other IT accessories. Police seized approximately Rs.40, 000 cash was from him.

Monday, June 16, 2008

Police arrested three persons including a Nigerian for credit card fraud

Mumbai police on Friday arrested three persons including a Nigerian for duping a shop selling mobile phones by using international credit cards.

The accused were caught when they went to the same shop for the second time in less than three days.

As per the police sources accused had the knowledge about the clearing of the payments that the payments made through international credit cards were cleared after more than 24 hours and they used this delay to dupe a retail chain.

Four persons, including two Nigerians, on Wednesday, went to the Mobile Store at Marol Maroshi in Andheri and bought an i-pod and three mobile phones worth Rs85, 547 using credit cards.

But the amount didn’t get credited to the shop’s account therefore manager Ketan Bareya alerted his employees, who got the accused arrested when they visited the shop for the second time.

Police has recovered a total of 11 international credit cards of several banks from the trio the main suspect Iyo Kayode (30), a Nigerian, and co-accused Mukesh Atiya (27) and Kalpesh Kachariya (21) - both graduates and residents of Goregaon. Police is still looking for their fourth accomplice, Steve Watson — a Nigerian.

The trio has been booked on charges of cheating, forging and common intention under the Indian Penal Code and has been remanded in police custody till June 19.

“On Wednesday, two youths came to the shop and selected an i-pod and three mobile phones. After selecting the items, they called two Nigerians who were waiting outside the shop and Watson made the payment through a credit card which he claimed was his,” Bareya said.

Bareya told the police when the money wasn’t credited into his account even after a day, he alerted his employees. “A day later, the accused again called up at the shop to enquire whether we had any costly mobile phones. They then visited the shop, selected a few mobile phones and placed the credit card for payment. The first two cards declined payment. Not letting them get the whiff of our suspicion, we made them wait in the shop and informed the police,” Bareya said.

The accused have duped around 20 branches of The Mobile Store in the city. “Nigerians were involved in all the fraud transactions and they had duped the store of Rs15 lakh over a month or two,” Bareya said.

“Atiya, who owns a mobile phone shop in Goregaon, befriended the Nigerians this year when they visited his shop. The Nigerians offered him a mobile phone for every con,” said senior inspector Rajdoot Rupwate of the Powai police station. Rupwate told Atiya at used to sell the handsets bought from Nigerians.

Sub-inspector Sanjay Joshi told Atiya and Kachariya used to finalize the deal, while Kayode and Watson paid using forged credit cards.

“According to the banks’ rule, if a person shops for over Rs10, 000 on credit card heshe has to submit an identity proof to the shop. We are verifying whether the cards recovered are actually owned by someone living outside India. Investigations are on to find their involvement in other such cases,” said Joshi.

Tuesday, June 10, 2008

Cardholders be careful before choosing part-pay bill payment option

Credit cardholder’s be careful in making your bill payments otherwise outstanding amount on card can cost you dear. Therefore cardholders must go through the terms and conditions properly before choosing to part-pay their bills. The card issuers charge the interest not just on the outstanding balance even though cardholder has paid a major chunk of the billed amount, but on all subsequent transaction.

In fact many of the savvy cardholders are aware about this common banking practice of revolving credit but many of them are not aware especially the new ones.

A senior banker explains with an example that how bank levies interest: "Suppose you pay 90% of the billed amount and only 10% is left. The next month (in the following billing cycle), you have to pay interest from the date of the first purchase." So effectively, the consumer loses out on the interest-free credit period. "If you part-pay," an industry expert emphasizes, "not only do you pay interest on the outstanding amount, you also lose interest-free credit facility. Your meter starts as soon as you use your card thereafter." (Incidentally, in case of cash withdrawals, interest charges are levied from the date of transaction).

Banking ombudsman official points out that pre-determined charge are mentioned in the booklet which comes along with the card. "It covers all terms and conditions, but few bother to read it." Thus cardholder cannot challenge these charges, at the banking ombudsman’s level, as the cardholder has accepted the terms by duly signing up for the card.

RBI through 2007 master circular on credit card operations of banks have made it mandatory for the banks to clearly mention the charges. It states: "Card issuers should quote annualized percentage rates (APR) on card products (separately for retail purchase and for cash advance, if different). The method of calculation of APR should be given with a couple of examples for better comprehension. The manner in which the outstanding unpaid amount will be included for calculation of interest should also be specifically shown with prominence in all monthly statements... These aspects may be shown in the welcome kit in addition to being shown in the monthly statement."

The fair practice code of the Indian Banks’ Association, adopted by its member banks, too promises, "We will send a service guide/member booklet giving detailed terms and conditions, interest and charges applicable and other relevant information with respect to usage of your credit card along with your first credit card." For the help of the consumer’s card issuing banks have put the information on their websites.

Recently banks have hiked the interest rates on credit card therefore bankers recommend cardholders to use it only as a short-term credit facility. They advise consumers who might face a repayment crunch to opt for an EMI (equated monthly installment) option—in the first place. They say however, the interest rate too works out to 18-24%, which is quite lower than the interest paid on credit card’s outstanding balance.

But here the consumers have to be careful because the EMI option is normally valid only for a particular transactions and not the outstanding balance. "If you are not able to pay your card bills, take a personal loan," a banker recommends.

Friday, June 6, 2008

StanChart launches card combining cash back and rewards

Global lender, Standard Chartered has launched ‘Manhattan Platinum Card’. The card has been designed to give maximum value to its customers, as well as offers both cash back and rewards as a standard feature on the same card to its customers.

The card is different from other cards in the sense that the cash back and reward benefits of this card can be enjoyed across merchants. Through online catalogues, card offers redemption of reward points on a wide range of gift articles, complimentary tickets for online bookings at PVR cinemas, and 10% off on purchase of books at all Odyssey book stores and gift vouchers for every purchase at Music World. Customers will also get all platinum card features like travel and dining benefits and superior service benefits which are identical with Standard Chartered.

Murali M Natrajan, Regional Head, Consumer Banking – India and Nepal, said “The Manhattan Platinum Credit Card adds a youth oriented dimension to the concept of Platinum credit cards with the perfect blend of lifestyle benefits that reflects the attitude of young urban India. Standard Chartered Bank is extremely proud to present this for the first time in India and we have always believed in catering to our customers every need. We have designed this card with the aim of giving our customers the unique experience of using many cards rolled into one.”

According to a bank press release cardholders will get 5% cash back on all departmental stores and supermarkets and five reward points per Rs 100 for all other spends.

R L Prasad, General Manager, Credit Cards & Personal Loans, said “After the success of our Manhattan credit card, The Manhattan Platinum Card provides our customers’ unmatched benefits through the cash back and rewards program. There is no other product available that offers flat rewards as high as 5% as a standard feature. This is not a promotional offer that lapses after a point in time but a benefit ingrained in the product; the customer will see the rewards as cash-back or reward points in his statement under each of his transactions.”

The card has been initially launched in the 5 metros Mumbai, Delhi, Kolkata, Chennai and Bangalore and later on will be launched in rest of India. In the beginning the card will carry an annual fee of Rs 2,000 and is being offered free for the first year as an introductory offer.