Virtual Credit Card Scams: All You Need To Know And How To Stay Safe

The Delhi Police Cyber Cell recently arrested Ramandeep Singh (26) for orchestrating a virtual credit card scam using the KIWI app. Acting on a complaint from Vasant Kunj resident Surinder Singh, the police traced Mr Singh's activities to Fazilka, Punjab. The scam amounted to Rs 58 lakh, with Mr Singh creating virtual credit cards using PAN, linked to various mobile numbers and Gmail IDs. During the raid, the police seized evidence, including six smartphones, 121 SIM cards, identification documents, ATM cards, and a laptop. Mr Singh has confessed to his involvement in the scam, reports Millennium Post.

What is a virtual credit card scam?

A virtual credit card scam is a fraudulent scheme where criminals exploit credit cards to carry out unauthorised transactions and financial activities. 

Here is an overview of how a virtual credit card scam typically works:

• Creation of Virtual Credit Cards: Scammers use stolen or illicitly obtained personal information, such as credit card details or PAN numbers, to create virtual credit cards. These virtual cards may be generated through legitimate apps or platforms offering virtual card services.

• Linking to Accounts: The fraudsters link the virtual credit cards to various mobile numbers, email addresses, or online accounts, creating a web of connections to mask their identity.

• Exploiting Credit Limits: Once the virtual credit cards are set up, the scammers exploit the associated credit limits. They may make unauthorised online purchases, transfer funds, or engage in other financial transactions.

• Money Transfer and Withdrawal: The fraudsters transfer the fraudulently obtained funds from the virtual credit cards into their own bank accounts using different payment gateways. Subsequently, they may withdraw the money for personal use or transfer it to other accounts.

• Detection: Victims usually discover the scam when they notice unauthorised transactions on their actual credit cards, which are linked to the virtual cards. 

Some common types of virtual credit card scams are:

1. Phishing Scams: Fraudsters send deceptive emails, messages, or websites mimicking legitimate virtual credit card services to trick users into providing their personal information.

2. Fake Virtual Card Services: Scammers create fake virtual credit card platforms, enticing users to sign up and share their credit card details. These platforms may not provide any real services and exist solely to collect sensitive information.

3. Unauthorised Virtual Card Creation: They obtain personal information, such as credit card details or PAN numbers, to create virtual credit cards without the cardholder's knowledge. 

4. Account Takeover: Cybercriminals gain unauthorised access to individuals' virtual credit card accounts, altering settings, adding new cards, or making unauthorised transactions.

5. Tech Support Scams: Scammers pose as virtual credit card support representatives, reaching out to users and convincing them to grant remote access to their devices. Once in control, they can initiate unauthorised transactions.

6. Application-Based Scams: Malicious mobile apps claiming to offer virtual credit card services may be used to collect personal information or carry out fraudulent transactions.

7. Social Engineering: Scammers exploit human psychology by manipulating individuals into revealing sensitive information, such as credit card details or login credentials.

8. Online Purchase Scams: Fraudulent sellers may request payment through virtual credit cards for goods or services that they have no intention of delivering.

9. Account Hacking and Transfers: Criminals gain access to a user's virtual credit card account, change settings, and initiate fund transfers without the cardholder's consent.

10. Sim-Swapping Attacks: Scammers fraudulently transfer a victim's phone number to a new SIM card, gaining access to two-factor authentication codes and potentially compromising virtual credit card accounts.

11. Malware and Keylogging: Malicious software infects devices, capturing keystrokes and sensitive information entered by users, including virtual credit card details. 

How can you protect yourself from being scammed?

Protecting yourself from virtual credit card scams involves adopting proactive measures to safeguard your personal and financial information. Here are some tips to help prevent falling victim to virtual credit card scams:

1. Secure Personal Information:

   1. Safeguard your credit card details, including the card number, expiration date, and CVV code.

   2. Be cautious about sharing sensitive information such as your PAN number, especially online.

2. Use Reputable Platforms:

   1. Stick to well-known and reputable virtual credit card platforms if you choose to use them.

   2. Research and read reviews before trusting any virtual card service.

3. Regularly Monitor Your Accounts:

   1. Keep a close eye on your credit card statements for any unauthorised transactions.

   2. Set up transaction alerts or notifications to be immediately informed of any unusual activity.

4. Be Wary of Phishing Attempts:

   1. Avoid clicking on suspicious links or responding to unsolicited emails or messages requesting your credit card information.

   2. Verify the legitimacy of any communication related to virtual credit cards.

5. Use Two-Factor Authentication (2FA):

   1. Enable 2FA wherever possible to add an extra layer of security to your accounts.

6. Update and Secure Devices:

   1. Keep your devices and software up to date with the latest security patches.

   2. Use strong, unique passwords for your online accounts, including virtual credit card platforms.

7. Regularly Check Your Credit Report:

   1. Obtain and review your credit report regularly to identify any unauthorised accounts or activities.

8. Educate Yourself:

   1. Stay informed about common scams and fraud tactics.

   2. Be cautious about sharing personal information on public platforms.

9. Use Secure Wi-Fi Connections:

   1. Avoid conducting sensitive transactions on public Wi-Fi networks.

   2. Use secure, password-protected networks for online activities.

10. Report Suspicious Activity:

    1. If you notice any unauthorised transactions or suspect fraudulent activity, report it to your credit card provider and relevant authorities immediately. 

By staying vigilant and implementing these measures, you can reduce the risk of falling victim to virtual credit card scams.