Skimming fraud takes many forms but usually involves a cardholder turning over physical possession of a card to a retail or restaurant employee, who then swipes the card through a small, illegal reader called a skimmer. This device copies the data encoded on the card’s magnetic stripe to enable criminals to create counterfeit cards.
TransUnion says its new Common Point of Purchase (CPP) tool works by creating a pooled database of historical data about all known skimmed cards from multiple credit card portfolios. This data is then analyzed to identify places where skimming is repeatedly occurring. When a common merchant is found, TransUnion transmits a daily report to credit card issuers that advises them of the findings via a URL. This information is then used to initiate an investigation to determine if the merchant is a victim of credit card skimming.
This first-of-its-kind solution automates what was previously a fragmented and manual process to allow issuers to more rapidly and effectively identify points of compromise based on pooled data, said Tim Keller, director of fraud and identity management solutions for TransUnion. And, because CPP is based on industry trends, the rules are easily adapted to counter the change in fraudulent behavior.
CPP was first launched in Canada five years ago and is now available throughout North America.
