Carding Fraud Explained: Prevention and Protection Methods

Carding fraud is a serious issue that affects many people worldwide. Carding is a type of identity theft where a person's credit card information is stolen and used for unauthorized purchases.

To protect yourself from carding fraud, it's essential to understand how it works. Carders use various methods to obtain credit card information, including phishing scams and hacking into online stores.

Be cautious of emails or messages that ask for your credit card information, as they could be phishing scams. These scams often appear to be from a legitimate company but are actually designed to steal your information.

Keep your credit card information secure by using strong passwords and enabling two-factor authentication. This will make it more difficult for carders to access your information.

Carding fraud is a type of payment card theft where attackers use automated software, or bots, to test stolen credit card numbers against multiple payment sites. The goal is to find valid card details that can be used for other malicious activities.

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Attackers often obtain stolen credit card numbers from criminal marketplaces or by compromising websites or payment channels. The quality of these stolen credit card numbers is often unknown, making it difficult for merchants to detect carding fraud.

Here are some common signs of carding fraud that merchants can look out for:

These signs can indicate that a carding bot is accessing a merchant's site, and prompt them to take action to prevent further fraud.

Carding comes with its own language, which can be confusing for those new to the topic.

A couple of terms are discussed below.

One term you'll often hear is "carding", which is the process of obtaining and using stolen credit card information.

Carders use various techniques to obtain this information, including phishing and social engineering.

Another term you might come across is "carder", which refers to an individual who engages in carding activities.

Carding fraudsters have been known to target gift cards, exploiting their anonymous nature to steal funds. A malicious bot called GiftGhostBot was designed to hack gift card balances, compromising nearly 1,000 eCommerce websites.

For another approach, see: Can I Purchase Gift Cards with a Credit Card

This bot enumerated through possible gift card account numbers, automatically requesting the balance account of each card number. When a card balance was identified, the bot would use the validated gift card numbers to make purchases.

The beauty of stealing money from gift cards is that it's typically anonymous and untraceable once stolen. This makes it a favorite tactic among cyber thieves.

Here are some common signs of a carding attack on gift cards:

In this case, the bot was able to identify validated gift card numbers by enumerating through possible account numbers and requesting the balance account of each card number.

Carding fraud is a type of credit card scam where a hacker steals your credit card details to buy prepaid gift cards. The hacker might gain access to a store's or website's credit card processing system, obtaining a list of credit or debit cards recently used for purchases. This information is then sold to a third party, known as a carder, who uses the stolen information to make purchases.

The carder typically buys gift cards from retailers like Amazon or Walmart, using a third party to receive the goods and then ship them to other locations. This limits their risk of drawing attention to themselves. The carder may also sell the goods on websites offering a degree of anonymity.

Carding forums are websites that teach fraudsters about this illicit trade, where they buy and sell stolen credit and debit card information. Fraudsters use these sites for money laundering and to discuss ways to avoid detection.

Here are the top 5 most common carding attacks:

Carding attacks often involve testing stolen credit card information by making small purchases online. This is done using a bot that attempts to validate credit card details against multiple payment sites. Successful card numbers are then organized into a separate list and used for other criminal activity or sold to organized crime rings.

Companies are implementing various techniques to stay ahead of carders, such as requiring more information from the user that is not as easily available to the carder.

To safeguard your payment site against bad bots used in credit card cracking, consider using bot management with Imperva, device fingerprinting, and browser validation. These techniques can help identify browser and device parameters that remain the same between sessions, indicating the same entity is connecting again and again.

Real users visiting a payment website exhibit typical behavior patterns, which can be analyzed using behavioral analysis technology to detect anomalies. This can help identify bad bots and prevent cracking attempts. Analyze as much data as possible, including URLs accessed, site engagement metrics, mouse movements, and mobile swipe behavior.

To protect yourself against carding, follow these steps:

By taking these steps, you can significantly reduce the risk of falling victim to carding fraud.

A credit card dump is a serious concern for anyone who uses credit cards. It occurs when a criminal makes an unauthorized digital copy of a credit card.

The scale of credit card dumps has expanded significantly in recent years, with some attacks affecting millions of victims. It's essential to be aware of this threat and take steps to protect yourself.

If you notice any unusual activity on your credit card account, such as incoming messages or calls from unknown sources, be wary. Don't click on links, download files, or respond to their message.

Unprofessional website errors can also be a sign of a credit card dump. If you notice design flaws, misspellings, clunky navigation, or links that lead to nowhere on your credit card company's website, be on guard.

Sudden changes in your device's behavior, such as being noticeably slower, hotter, or louder, can indicate the presence of malware. Be suspicious if you notice strange new icons or animations on your computer or phone.

Mystery transactions on your credit card report are another red flag. Review your report at least monthly to catch any unusual or unauthorized transactions.

Here are some warning signs to look out for:

If you notice any of these signs, take action immediately to protect your credit card information.

Velocity checks are a way to prevent credit card fraud by monitoring the number of transactions made on a card within a particular time period.

Users typically don't make multiple payments in quick succession, especially payments so rapid as to be beyond the human capacity.

Merchants often employ velocity checks to detect abnormal purchasing patterns.

Velocity can be monitored by dollar amount, user IP address, billing address, Bank Identification Number (BIN), and device.

If the merchant detects abnormal purchasing patterns, they can decline the transaction.

For more insights, see: We Take Card Payments

Prevention and Protection is key to keeping your account details safe from carding and identity theft. To start, use a strong and unique password for all your online accounts, and avoid using the same password for multiple sites.

Use two-factor authentication (2FA) whenever possible, as it adds an extra layer of security to your accounts. This can be a code sent to your phone or a biometric scan, and it's a great way to prevent unauthorized access.

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Device fingerprinting is a technique that can help identify browser and device parameters that remain the same between sessions, indicating the same entity is connecting again and again. This can be a red flag for fraudsters or bots attempting credit card fraud.

Browser validation involves validating that each user browser is really what it claims to be, and can help prevent malicious bots from pretending to be a specific browser. This can be done by checking for expected JavaScript agents and calls.

Machine learning behavior analysis can help identify bad bots and prevent cracking attempts by analyzing user behavior and detecting anomalies. This can include analyzing URLs accessed, site engagement metrics, mouse movements, and mobile swipe behavior.

Reputation analysis can also help identify known software bots with predictable technical and behavioral patterns, and can be used to cross-reference traffic with known fingerprints of bad bots.

Here are some progressive challenges you can use to test if a user is a bot or not:

It's also a good idea to keep an eye on your account activity and report any suspicious transactions to your bank or credit card company. This can help prevent further damage and catch any potential identity theft early on.

Authorization is a key part of the payment process.

If the merchants detect signs of fraud, they won't request the total funds from your financial institution.

This means you'll get a refund instead, which is a relief if you've been unfairly targeted by a scam.

Merchants are proactive in preventing unauthorized transactions, often catching suspicious activity before it's too late.

In such cases, the merchant will issue a refund, putting an end to the attempted transaction.

Carding forums often provide related computer crime services, such as phishing kits, malware and spam lists, and even act as a distribution point for the latest fraud tutorials. These services can be accessed for free or commercially.

ICQ was once the instant messenger of choice due to its anonymity, and some users modified MSN clients to use PGP. This made it easier for fraudsters to communicate and coordinate their activities.

Carding related sites may be hosted on botnet-based fast flux web hosting for resilience against law enforcement action. This makes it difficult for authorities to track down and shut down these sites.

For your interest: Paying down Credit Cards

Some carding operations also sell other types of account information, such as PayPal, Uber, Netflix, and loyalty card points, alongside card details. Logins to many sites may also be sold as a backdoor access, often for major institutions like banks, universities, and even industrial control systems.

Here are the top 5 most common carding attacks:

These attacks are often used to steal sensitive information and commit various types of fraud.

Resale is a critical aspect of the darknet market ecosystem. Stolen data is often bundled as a "Base" or "First-hand base" if the seller participated in the theft themselves.

Resellers can buy "packs" of dumps from multiple sources, making it easier to sell the data on darknet markets and other carding sites and forums. This has led to teenagers getting involved in fraud, such as using card details to order pizzas.

Individual "dumps" may be purchased by zip code and country to avoid alerting banks about their misuse. Automatic checker services perform validation en masse to quickly check if a card has yet to be blocked.

Cards with a greater than 90% valid rate command higher prices, making them more valuable to resellers. Sellers will advertise their dump's "valid rate", based on estimates or checker data.

Here's a breakdown of estimated per card prices for stolen payment card data in 2015:

"Cobs" or changes of billing are highly valued, where sufficient information is captured to allow redirection of the registered card's billing and shipping addresses to one under the carder's control.

Cash out methods are getting more sophisticated, with thieves using pre-paid cards, gift cards, or reshipping goods through mules to fence stolen goods online.

These reshipping services are being targeted by law enforcement, leading to the rise of dedicated criminal operations for reshipping stolen goods.

Thieves are also using hacked computers with SOCKS proxy software to optimize acceptance from payment processors, making it harder to catch them in the act.

This SOCKS proxy software helps hacked computers blend in with legitimate traffic, making it more difficult for payment processors to detect and block suspicious transactions.

Telegram is a popular platform for organized criminals to engage in carding activities. They create their own channels to release stolen bank data.

Criminals hope that other criminals will use this data, rendering the card "dead". This is because some markets offering stolen bank card data provide refunds for cards that are checked and found to be "dead".

Hundreds of channels on Telegram are used for this purpose, releasing stolen bank cards.