Slashdot Mirror

← Back to Stories (view on slashdot.org)

When Fraud Detection Shuts Down Credit Cards Inappropriately

Posted by timothy on from the enjoy-your-trip-to-malaysia dept.

reifman writes: On Sunday, Capital One declined a $280 travel reservation I charged at India-based ClearTrip.com and immediately shut off my card for all transactions until I contacted them by phone. It wasn't the first time that CapitalOne had shut off my card after a single suspect transaction. But, I'd actually purchased from ClearTrip.com using my CapitalOne card on two prior occasions. It was an example of very poor fraud detection and led me on a tour of their pathetic customer service. The banks want to cut their losses regardless of how it impacts their customers. Having had my own credit card suspended out of an abundance of caution on a different credit card issuer's part (for legitimate charges), but having recently had some widely known scam charges get accepted, the fraud protection algorithms that the credit companies use certainly seem inscrutable sometimes, and so do the surrounding practices about communicating with customers. How would you like it to work instead?

6 of 345 comments (clear)

  1. HSBC are worse by DCFC · · Score: 4, Informative

    I have had serious problems with the aggressively incompetent HSBC 'fraud' detection.

    The 'best' was when they claimed the reason they had (again) blocked my card was that a whole batch of cards had been compromised and it wasn't just my card.

    Sadly for the liar at HSBC was I'm a tech journalist, so I immediately contacted their PR department who denied any knowledge of the breach.

    It was just made up to make me go away.

    --
    Dominic Connor,Quant Headhunter
    1. Re:HSBC are worse by west · · Score: 4, Informative

      It's likely that your card was used at a location for which an abnormal number of cards were found to have been skimmed. This is usually the reason that a whole batch of cards get cancelled. ("Kill every card used at Joe's Gas Station between Monday and Thursday.")

      Ten years ago, the US banks didn't want the expense of switching to EMV. The cost would be that Americans would have to expect to have several cards declined at any one time because of fraud-fighting measures. The banks knew this was the future.

      As it was, as all the world's bank card fraud organizations migrated to the US, the US was compelled to switch anyway. (You never want to be the last vulnerable man standing.) They'd have been far better going a decade ago.

  2. Text message on use by sunderland56 · · Score: 5, Informative

    My CC sends me a text message whenever it is used. It's quick (usually arrives before I've signed the slip), it's free, and it doesn't need some stupid app installed with insane permissions. So, *I* can decide which transactions are bogus, instead of some computer algorithm; and when a truly bogus one does appear, I can notify the bank immediately. The bank can then concern themselves with actual proven bogus purchases, instead of thousands of "suspect" ones.

  3. Re:This is why you call your bank before tourism by Anonymous Coward · · Score: 5, Informative

    Well, but there is still a point here. For example, I have had a couple of occasions of fraud on my account - they both happened when the "accounts got out" (massive breach of the credit union's credit card file). The first racked up three charges for $900.00 in Japan The next was a flight in India (in rupees) that came to well over $1,000 plus the foreign currency conversion fee. However, I have had the same card processor block the card and deny the purchases when I made two orders Newegg.com in the same day. The "fraud detection" is completely broken.

  4. Re:This is why you call your bank before tourism by brxndxn · · Score: 4, Informative

    This would probably fix 99.99% of all credit card fraud.. Will they do it? I doubt it. I swear there is somehow a business in allowing certain fraud. If there wasn't, the credit card companies wouldn't be so shitty in preventing it. Fucking Discover.. I travel a lot (usually within the states). I go to San Francisco and try to buy dinner for clients (after making a previous purchase successfully in San Fran).. DECLINED.. right in front of my clients. Make a phone call to Discover and they 'fix it' and I tell them I want my card to work. Then I go to pay the bar tab at LAX for a layover on my way back.. DECLINED.. right in front of everyone at the bar. It's so fucking annoying that I started carrying cash. Fuck these credit card companies.. I wish Bitcoin was accepted everywhere.

    --
    --- We need more Ron Paul!
  5. Re:This is why you call your bank before tourism by IamTheRealMike · · Score: 4, Informative

    Instead of rejecting the payment outright and freezing the card, text message my phone IMMEDIATELY and I can read a 6 digit code to the cashier to allow the transaction

    How about an even better solution - insert your card into a reader, type in your PIN and that's the two factors right there. You know...... the system that's already used everywhere in the world except for America? It works pretty well. I think the USA is starting to roll it out now, albeit a slightly crippled form of it (they managed to take the 2-factor system everyone else uses and make it 1-factor).