Secret Service to Help Credit Card Fraud: Techniques to Resemble Anticounterfeiting Probes
Weinstein, Michael, American Banker
NEW YORK -- The U.S. Secret Service is planning to undertake a "major effort" to fight credit card fraud, a Secret Service fraud expert said.
The agency's tactics will include the formation of centralized computer files on fraudulent card-related activities, said Gordon K. May, assistant special agent in charge of the fraud and forgery division at the Secret Service.
Mr. May said the Secret Service decided to tackle card fraud at the request of the banking industry, which has been suffering mounting losses. Card fraud now costs the industry more than $150 million a year, according to statistics from Visa and MasterCard.
Bankers have also been lobbying in Congress for credit card fraud legislation. Both houses have already approved different card fraud bills, and Mr. May expects a final version to pass in September or October.
Such legislation would bring a broader range of card fraud under federal jurisdiction, enabling the Secret Service to move into the area, said Mr. May, who spoke last week at the annual meeting of Eastern States Monetary Services Inc., a Lake Success, N.Y., bank card processor.
Federal resources, he said, should boost the antifraud efforts of local law enforcement agencies.
The Secret Service intends to serve as a clearing house for card fraud information, Mr. May said. The agency will establish a data base listing all known counterfeit cards and fingerprints of people involved in credit card fraud.
The agency will then compare newly discovered counterfeit cards with known counterfeits in its files. Since the files will include the identity of the counterfeiter of each card, a card with similar characteristics will point to the same counterfeiter as the culprit, Mr. May explained.
Visual indicators used by investigators to compare counterfeit cards include ink colors, similar embossing flaws, and the plastic composition of the phony cards.
The Secret Service uses a similar technique -- of comparing known counterfeits with new ones -- to identify currency forgers, Mr. May said. Task Force in Miami
The agency has already begun working on several card fraud cases. In Miami, a task force including Secret Service agents, local authorities, and bankers tackled a card fraud case last December. In a matter of months, the task force made 31 arrests, dismantled five separate rings, and seized a range of paraphernalia, including 650 completed counterfeit cards, Mr. May said.
Local officials estimated that the task force's actions saved the banking industry $2. …