U.S. Department of Justice

Office of Community Oriented Policing Services

www.cops.usdoj.gov

Check and Card

Fraud

by

Graeme R. Newman

Problem-Oriented Guides for Police 

Problem-Specific Guides Series No. 21
www.PopCenter.org

Got a Problem? We’ve got answers!

Log onto the Center for Problem-Oriented Policing website

at www.popcenter.org for a wealth of information to help

you deal more effectively with crime and disorder in your

community, including:

• Web-enhanced versions of all currently available Guides

• Interactive training exercises

• On-line access to research and police practices

Designed for police and those who work with them to

address community problems, www.popcenter.org is a great

resource in problem-oriented policing.

Supported by the Office of Community Oriented Policing

Services, U.S. Department of Justice.

Center for Problem-Oriented Policing
Check and Card Fraud

Graeme R. Newman

This project was supported by cooperative agreement

#2002CKWX0003 by the Office of Community Oriented Policing

Services, U.S. Department of Justice. The opinions contained herein

are those of the author(s) and do not necessarily represent the

official position of the U.S. Department of Justice.

www.cops.usdoj.gov

ISBN: 1-932582-27-4

Problem-Oriented Guides for Police 

Problem-Specific Guides Series

Guide No. 21

About the Problem-Specific Guides Series i

About the Problem-Specific Guides Series

The Problem-Specific Guides summarize knowledge about

how police can reduce the harm caused by specific crime

and disorder problems. They are guides to prevention and

to improving the overall response to incidents, not to

investigating offenses or handling specific incidents. The

guides are written for police–of whatever rank or

assignment–who must address the specific problem the

guides cover. The guides will be most useful to officers

who

• Understand basic problem-oriented policing

principles and methods. The guides are not primers in

problem-oriented policing. They deal only briefly with

the initial decision to focus on a particular problem,

methods to analyze the problem, and means to assess

the results of a problem-oriented policing project. They

are designed to help police decide how best to analyze

and address a problem they have already identified. (An

assessment guide has been produced as a companion to

this series and the COPS Office has also published an

introductory guide to problem analysis. For those who

want to learn more about the principles and methods of

problem-oriented policing, the assessment and analysis

guides, along with other recommended readings, are

listed at the back of this guide.)

• Can look at a problem in depth. Depending on the

complexity of the problem, you should be prepared to

spend perhaps weeks, or even months, analyzing and

responding to it. Carefully studying a problem before

responding helps you design the right strategy, one that

is most likely to work in your community. You should

not blindly adopt the responses others have used; you

must decide whether they are appropriate to your local

situation. What is true in one place may not be true
ii Check and Card Fraud

elsewhere; what works in one place may not work

everywhere.

• Are willing to consider new ways of doing police

business. The guides describe responses that other

police departments have used or that researchers have

tested. While not all of these responses will be

appropriate to your particular problem, they should help

give a broader view of the kinds of things you could do.

You may think you cannot implement some of these

responses in your jurisdiction, but perhaps you can. In

many places, when police have discovered a more

effective response, they have succeeded in having laws

and policies changed, improving the response to the

problem.

• Understand the value and the limits of research

knowledge. For some types of problems, a lot of useful

research is available to the police; for other problems, little

is available. Accordingly, some guides in this series

summarize existing research whereas other guides illustrate

the need for more research on that particular problem.

Regardless, research has not provided definitive answers to

all the questions you might have about the problem. The

research may help get you started in designing your own

responses, but it cannot tell you exactly what to do. This

will depend greatly on the particular nature of your local

problem. In the interest of keeping the guides readable, not

every piece of relevant research has been cited, nor has

every point been attributed to its sources. To have done so

would have overwhelmed and distracted the reader. The

references listed at the end of each guide are those drawn

on most heavily; they are not a complete bibliography of

research on the subject.
About the Problem-Specific Guides Series iii

• Are willing to work with other community agencies

to find effective solutions to the problem. The police

alone cannot implement many of the responses

discussed in the guides. They must frequently implement

them in partnership with other responsible private and

public entities. An effective problem-solver must know

how to forge genuine partnerships with others and be

prepared to invest considerable effort in making these

partnerships work.

These guides have drawn on research findings and police

practices in the United States, the United Kingdom,

Canada, Australia, New Zealand, the Netherlands, and

Scandinavia. Even though laws, customs and police

practices vary from country to country, it is apparent that

the police everywhere experience common problems. In a

world that is becoming increasingly interconnected, it is

important that police be aware of research and successful

practices beyond the borders of their own countries.

The COPS Office and the authors encourage you to

provide feedback on this guide and to report on your own

agency's experiences dealing with a similar problem. Your

agency may have effectively addressed a problem using

responses not considered in these guides and your

experiences and knowledge could benefit others. This

information will be used to update the guides. If you wish

to provide feedback and share your experiences it should

be sent via e-mail to cops_pubs@usdoj.gov.
iv Check and Card Fraud

For more information about problem-oriented policing,

visit the Center for Problem-Oriented Policing online at

www.popcenter.org or via the COPS website at

www.cops.usdoj.gov. This website offers free online access to:

• the Problem-Specific Guides series,

• the companion Response Guides and Problem-Solving Tools

series,

• instructional information about problem-oriented policing

and related topics,

• an interactive training exercise, and

• online access to important police research and practices.
Acknowledgments v

Acknowledgments

The Problem-Oriented Guides for Police are very much a

collaborative effort. While each guide has a primary

author, other project team members, COPS Office staff

and anonymous peer reviewers contributed to each guide

by proposing text, recommending research and offering

suggestions on matters of format and style.

The principal project team developing the guide series

comprised Herman Goldstein, professor emeritus,

University of Wisconsin Law School; Ronald V. Clarke,

professor of criminal justice, Rutgers University; John E.

Eck, associate professor of criminal justice, University of

Cincinnati; Michael S. Scott, clinical assistant professor,

University of Wisconsin Law School; Rana Sampson,

police consultant, San Diego; and Deborah Lamm Weisel,

director of police research, North Carolina State

University.

Karin Schmerler, Rita Varano and Nancy Leach oversaw

the project for the COPS Office. Suzanne Fregly edited

the guides. Research for the guides was conducted at the

Criminal Justice Library at Rutgers University under the

direction of Phyllis Schultze.

The project team also wishes to acknowledge the members

of the San Diego, National City and Savannah police

departments who provided feedback on the guides' format

and style in the early stages of the project, as well as the

line police officers, police executives and researchers who

peer reviewed each guide.

Contents

About the Problem-Specific Guides Series. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i

Acknowledgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v

The Problem of Check and Card Fraud . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Illegal Acquisition of Checks and Cards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Illegal Use of Checks and Cards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Low Reporting of Check and Card Fraud . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Factors Contributing to Check and Card Fraud. . . . . . . . . . . . . . . . . . . . . . . . . . 10

Understanding Your Local Problem. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Asking the Right Questions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Incidents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Offenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Victims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Locations/Times. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Measuring Your Effectiveness. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Responses to the Problem of Check and Card Fraud . . . . . . . . . . . . . . . . . . . . . . . . 19

General Considerations for an Effective Response Strategy . . . . . . . . . . . . . . . 20

Working with Businesses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Community Partnerships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Enforcement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

Responses with Limited Effectiveness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

Appendix: Summary of Responses to Check and Card Fraud . . . . . . . . . . . . . . . . . . 43

Endnotes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

References. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

Contents vii
viii Check and Card Fraud

About the Author . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57

Recommended Readings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59

Other Problem-Oriented Guides for Police . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
The Problem of Check and Card Fraud 1

The Problem of Check and Card Fraud

This guide describes the problem of check and card fraud,

and reviews factors that increase the risks of it. It then

identifies a series of questions to help you analyze your

local problem. Finally, it reviews responses to the problem,

and what is known about them from evaluative research

and police practice.

The guide covers fraud involving (1) all types of checks

and (2) plastic cards, including debit, charge, credit, and

"smart" cards. Each can involve a different payment

method. While there are some obvious differences

between check and card fraud, the limitations and

opportunities for fraud and its prevention and control by

local police are similar enough to warrant addressing them

together. Furthermore, some cards (e.g., debit cards) are

used and processed in a similar way to checks, and

electronic checks are processed in a similar way to cards,

so that the traditional distinction between cards and

checks is fast eroding. Table 1 summarizes the essential

differences between check and card fraud.
2 Check and Card Fraud

Table 1 

Common Differences between Check and Card Fraud

Counterfeiting

Conversion to

Cash

Additional ID 

Signature

Checking

Payment

Processing

Loss Liability

Vulnerability

Points

Organized

Crime

Check

Entry level: requires photocopier or

personal computer with standard

color printer

Can be converted to cash at

checkout

Retail stores typically require

additional ID; banks may not ask for

ID if account number on check

matches bank records

Signature rarely checked, unless

check-cashing card required

Merchant submits check to bank for

payment

If bank rejects payment, merchant

carries loss and must recoup it from

customer; legitimate account owner

may be liable, depending on bank's

policies

Check acquisition; check payment

and cashing; check processing; and

bank, business, and consumer

environments

Less common with checks, though

sophisticated check-counterfeiting

rings do exist

Card

Entry level: amateur alterations easily

detectable; more advanced card

alteration or production requires

more costly resources

Cannot be converted to cash at

checkout (except for debit and

phone cards)

Additional ID rarely requested

Signature prime means of verifying

card user

(Highly simplified): merchant

submits card charge to bank, which

submits payment request to card

issuer, which verifies payment to

merchant's bank, which then pays

merchant

Negotiable: merchant may incur loss,

or card issuer may agree to do so;

legitimate card owner generally

protected from loss

Card issuance; card acquisition;

checkout; card-not-present sales

(usually telephone or online sales);

and after the sale (product returns)

Counterfeiting and distribution of

credit cards widely adopted by

organized crime groups
The Problem of Check and Card Fraud 3

In 2000, Visa International estimated that the yearly cost

of fraud worldwide was about 0.05 cent per every dollar

spent. This small amount works out to 300 million pounds

in Britain and an estimated $1 billion in the United States.

Since 1995, the amount of fraud losses on payment cards

has consistently risen in the United Kingdom,1 and in the

United States, the losses from online credit card fraud2

alone are estimated to reach $3.2 billion in 2007. Over 50

percent of Britons surveyed fear they will be victims of

credit card fraud.3

Apart from the obvious financial loss caused by check and

card fraud, it is a serious crime that requires preventive

action. It affects multiple victims and significantly

contributes to other types of crime. At an elementary

level, fraud is easy to commit, and the chances of

apprehension and punishment are slight.† Thus check and

card fraud is an ideal entry-level crime from which people

may graduate to more serious offenses. Other crimes that

either feed off check and card fraud or facilitate its

commission include the following:

• Drug trafficking. Addicts forge checks or fraudulently

use credit cards (often bought cheaply as "second

string" cards–that is, stolen or counterfeit cards that

have already been used). So the fraud fuels the drug

trade.4

• Identity theft. There is increasing evidence to suggest

that obtaining or accessing credit card accounts is the

main motive for identity theft,†† a crime that causes

victims very serious economic harm (ranging from

$5,000 to $20,000 per victim)5 and psychological

harm.††† Sophisticated technology has made the

counterfeiting of checks and plastic cards much more

difficult over the last decade. Although there is no

† In a Montreal study, the success

rate with a totally counterfeit card

was 87 percent, and with an altered

card, 77 percent. At checkout, the

average success rate was 45 percent,

although in most of the cases where

the sales clerk rejected the card, the

offender simply walked away,

without being accosted (Mativat and

Tremblay 1997).

†† In 2002, the Federal Trade

Commission reported that the main

motives for identity theft were as

follows: To obtain/take over a credit

card account - 53%; To acquire

telecommunications services - 27%;

To obtain/take over a checking

account - 17%; Other - 3%.

††† A 2000 survey of identity theft

victims found that less than half felt

their problems had been fully

resolved; all but one had gone to the

police as a last resort and had

received little satisfaction from doing

so (CALPIRG 2000).
4 Check and Card Fraud

definitive research available, it is likely that, as

counterfeiting has become increasingly difficult,

offenders have turned to the next best thing: stealing

cardholders' identity, and using legitimate cards. Thus

identity theft has become a serious crime; the U.S.

Congress has passed a special bill to deal with it.6

• Mail fraud. Offenders intercept checks, credit cards, or

bankcards in the mail, or do not forward mail that card

issuers or banks send to a customer's old address.

• Burglaries, robberies, and thefts from cars. Offenders

may commit these crimes specifically to get plastic

cards, or they may get them as a by-product of the

crime.†

• Pickpocketing. Pickpocketers may be attracted to

shopping malls and other crowded shopping venues

where people use checks and cards.

• Fencing. In areas where offenders commit check and

card fraud to buy high-priced goods, a fencing

operation may arise to facilitate conversion of the

goods into cash.

• Extortion. Customer databases that include credit card

and other personal information are very valuable to

businesses. They have therefore become targets in their

own right, and hackers sometimes steal them and hold

them for ransom.7

• Organized crime. Counterfeiting and marketing cards

requires considerable organization, for both production

and distribution. International organized crime rings

working out of East Asia tend to be involved in such

operations.

• Local gang-related crime. Small gangs may feed the

needs of addicts and the poor by using second-string

cards to buy food and other items at supermarkets. The

locals may protect these gangs, because they provide a

"service" to the community.

† Thefts from cars may increase as a

way to get credit card and personal

information if other opportunities

to get such information are blocked

by improved security measures in

the manufacture and processing of

plastic cards and checks (Levi 1998).

However, in other studies, this

"displacement" does not always

occur, even within card fraud itself–

for example, from using stolen

credit cards to counterfeiting cards

(Mativat and Tremblay 1997).
The Problem of Check and Card Fraud 5

• Cons and scams.8 The Internet now carries a wide range

of cons and scams offenders use to get credit card and

other personal information from unknowing victims.

People can easily create false websites and storefronts,

as little skill is required to do so. Furthermore, many

websites offer information on setting up such websites

and on running scams.

• Financial crimes against the elderly. The elderly are

prime targets of cons and scams, including check and

credit card fraud. (For more information, see the

Problem-Specific Guide on Financial Crimes Against the

Elderly.) 

• Shoplifting. Committing check and card fraud is simply

another way of "lifting" products from retailers. Using

a credit card fraudulently at checkout is much less risky

(because the authentication methods are so cursory).9

This type of theft from retail stores is probably much

greater than regular shoplifting, or it may be used in

concert with shoplifting.

• Car theft. Car rental companies are prime targets for

credit card fraud. Offenders may sell fraudulently

rented cars in the stolen vehicles market.

Plastic-card technology is developing rapidly. Issuers are

now offering both debit and credit services on one card,

are requiring a personal identification number (PIN) for

credit cards (introduced in France a decade ago, and in

England in 2001), and are replacing magnetic strips with

computer chips. Paperless or electronic checks are

increasingly used in business-to-business transactions.

Criminal use of these different products involves a wide

range of skills, activities, and financial investment. The

type of fraud will depend on the points of vulnerability

targeted in the delivery of services, as outlined in Table 1.
6 Check and Card Fraud

In general, check and card fraud may be divided into two

activities: the illegal acquisition of checks and cards, and the

illegal use of checks and cards. This distinction is not

absolute, since offenders may gain access to some cards

(e.g., phone cards) without actually acquiring the cards (e.g.,

by stealing account numbers).

Illegal Acquisition of Checks and Cards

The following are some of the ways offenders illegally

acquire checks and cards:

• Altering checks and cards. Offenders can do so with

the simplest equipment. However, altered checks and

cards are sometimes easy to detect.

• Counterfeiting checks and cards. Reasonably priced

machines for embossing, encoding, and applying

holograms to cards are available on the Internet.

• Committing application fraud. Offenders get a checking

or credit card account by using another person's

identity or a fictitious one.

• Stealing checks and cards through muggings,

pickpocketing, theft from cars, and burglaries.†

• Intercepting checks and cards in the mail. Intercepted

cards are particularly desirable because they are

unsigned. Offenders may also intercept boxes of blank

checks.

• Getting another person's PIN through trickery, for

example, by "shimming" (watching as the person

punches in a PIN).

• Manufacturing and marketing counterfeit cards via

internationally organized crime rings.

• Renting or selling stolen or counterfeit cards to a group

of "steady customers" via locally organized crime rings.

† Levi (1998) has noted that one in

five street robbers in London obtain

credit or debit cards from their

victims.
• Hacking into a retailer's customer database to get credit

card numbers.

• Setting up bogus websites that request credit card and

other personal information.

Illegal Use of Checks and Cards

The following are some of the ways offenders illegally use

checks and cards:

• Presenting a bogus check or card at checkout. The sales

clerk is supposed to verify that (a) the check or card

represents an actual account (usually done by checking a

computer database), and (b) the person presenting the

check or card is the account holder. If the offender gets

away with using the check or card, he or she may then

dispose of the goods by (a) selling them through a

known fencing operation or informally in local bars, or

(b) returning the goods to the same store (or a different

branch of the store) for cash.

• Making a "card-not-present" purchase (by telephone or

on the Internet). Offenders avoid the scrutiny of sales

clerks or security cameras and need only the card

information, not the card itself. Card-not-present fraud

is a major contributor to overall card fraud (see Figure

1). Between 1999 and 2001, it increased some 130

percent in the United Kingdom, with similar increases

internationally.10

• Denying ordering and/or receiving an item. Customers

who order an item online using a legitimate credit card

may deny doing so, claim they never received the item,

and stop payment on the card. Or they may claim that

an item they did order was never delivered, and demand

a refund.

The Problem of Check and Card Fraud 7
8 Check and Card Fraud

• Targeting a particular store or set of stores. Small

bands of career fraudsters may work together to "hit" a

particular store or set of stores with stolen or

counterfeit cards. These bands usually do not target

stores in or near their own neighborhoods; rather, they

will travel some 50 miles to other shopping areas to

commit fraud.11

Low Reporting of Check and Card Fraud

Perhaps the biggest problem for police is that people

rarely report check and card fraud to them.† In one recent

study, only one in four incidents of check and card fraud

were reported to the police.12 It is very likely that you have

a check or card fraud problem in your area, but do not

know about it. Many credit card issuers promise zero loss

to the user if the card is lost or stolen and illegal are

charges made. Thus, if cardholders do not suffer

† Over 90 percent of people report

their lost or stolen card to the card

issuer within one day. They rarely,

however, report their loss to the

police, unless it results from a crime

such as pickpocketing, burglary, or

mugging (Levi and Handley 1998a).

Counterfeit

39%

Card-not-present

23%

Lost/stolen card

28%

Intercepted in mail 

6%

Fraudulent

application

2%

Other

2%

Fig. 1. U.K. card fraud loss by type of fraud, 2001

Source: Adapted from Association of Payment Clearing Services (2002):

www.epaynews.com/statistics/fraud.html. 
The Problem of Check and Card Fraud 9

financially, they may have less motivation to report the

offense to the police. Merchants are also reluctant to

report fraud, or even to use fraud prevention techniques at

checkout, for fear that it will slow down the purchasing

process and negatively affect sales.13 Thus, fraudsters think

their chances of getting caught are very slim. One study

reported that some 80 percent of respondents thought it

was easy or very easy to carry out credit card fraud.14

The situation with check fraud is slightly different. Some

banks hold the account holder liable for loss. The

merchant who accepts the check may also be held

responsible, since the bank simply refuses to honor the

check if it detects a forgery. (Thus, retailers–especially

North American supermarkets, where check cashing is a

common service–are often more willing to cooperate with

police or develop their own security procedures

concerning check fraud.) It is not uncommon for some

conflict to arise between merchants and banks as to who

should bear the loss.15 This is a serious problem because,

as we will see, cooperation among competing merchants

and between merchants and banks is central to preventing

and reducing check and card fraud.16

Banks, large retail stores, and supermarket chains

commonly prefer to deal with merchandise loss, employee

theft, shoplifting, and check and card fraud internally.17

There are three significant reasons for this preference:

• They do not think police have the specific skills,

knowledge, and experience needed to deal with security

issues in the banking and retail environment.
10 Check and Card Fraud

• They hold a widespread view that losses due to theft

and fraud are simply a cost of doing business, and that

those losses are more than offset by the profits made

from using tempting product displays or only quickly

checking customer identities at checkout.

• They fear that calling in the police might negatively

affect business, because the crime problems become

public.

The check and card fraud that businesses do report to the

police is usually committed by repeat or "professional"

fraudsters. Or, for whatever reasons, the in-house security

wants to transfer responsibility to the criminal justice

system.

Factors Contributing to Check and Card Fraud

Understanding the factors that contribute to your problem

will help you frame your own local analysis questions,

determine good effectiveness measures, recognize key

intervention points, and select appropriate responses. You

should be aware that most check and card fraud is due to

factors beyond police control. Such factors include the

following:

• There are security flaws in check and card design and

production.

• Police typically do not have access to the vulnerability

points in the complex transactions that make up check

and card processing.

• It is inherently difficult to verify a check or card user's

identity.

• The Internet has greatly increased the opportunities for

fraud, perhaps having its greatest impact through

fraudulent card-not-present sales (see Figure 1).†

† A traditional credit card purchase

goes something like this: At

checkout, the customer gives the card

to the sales clerk, who runs it

through the computer to check

whether the account is legitimate.

The clerk then checks whether the

customer is the person named on the

card (usually by comparing

signatures, which are not an

especially reliable form of

identification, by the way). In a faceto-face situation, the clerk can try to

verify the customer's identity.

However, with telephone and online

purchases, there is no direct way to

do so.
The Problem of Check and Card Fraud 11

• Information about counterfeiting, skimming, and

hacking is now widely available on the Internet. Thus, it

is easier to commit card fraud than ever before.18

• To some extent, the sheer volume of card use accounts

for the increased amount of card fraud. In the United

Kingdom, the United States, and Australia, debit and

credit card use has increased tremendously over the last

20 years, although in the U.S., checks remain the

primary form of payment (besides cash). In Japan,

credit cards have been very slow to catch on, but debit

cards have gained wider acceptance.19 These differences

are largely related to the structure of financial service

markets in the various countries.

• The amount of card fraud committed internationally

has substantially increased in recent years. For example,

the proportion of fraud committed abroad on U.K.

cards has doubled in the past decade.20

• Although the rate of check fraud has decreased

considerably in the past decade, the financial loss due

to check fraud continues to increase, simply because of

the increase in the volume of sales.

• There is a technological "arms race."21 Each

technological advance makes it harder and harder to

counterfeit checks and cards. Microdot printing on

checks, hidden markings on checks and cards that show

up on color photocopiers, holograms, magnetic strips,

and now embedded chips–all these and many more

advances have raised the level of skill and equipment

needed for fraudsters to counterfeit checks and cards.

Unfortunately, dedicated fraudsters quickly acquire the

skills and equipment, so are soon able to produce

checks and cards that are extremely difficult to identify

as counterfeit. In fact, as Figure 1 shows, counterfeiting

is the major type of card fraud, and it is increasing

rapidly.22
12 Check and Card Fraud

• International organized crime groups that specialize in

counterfeit credit cards generally lie beyond the reach

of local police, although their markets certainly lie

within local neighborhoods. These groups became very

active in Southeast Asia toward the end of the 1990s,

and in a short time, have managed to overcome every

new security feature introduced into plastic-card

manufacture. Their distribution system employs Asians

in large North American and European cities.23

• Many card issuers are eager to get customers. In recent

years, the competition has become very intense. The

mail and Internet are loaded with tempting offers, and

it is now very easy to get a credit card.

• Many card issuers do not hold cardholders responsible

for any loss incurred through fraudulent use by

another. Thus, cardholders have no real motivation to

take security precautions. In fact, they may even collude

with others. Retailers may bear the loss in card-notpresent sales, and card issuers in standard credit-card

sales.

Although police face these and other obstacles when

addressing check and card fraud, there is much that can be

done.
Understanding Your Local Problem 13

Understanding Your Local Problem

The information provided above is only a generalized

description of check and card fraud. You must combine

the basic facts with a more specific understanding of

your local problem. Analyzing the local problem carefully

will help you design a more effective response strategy

later on.

Asking the Right Questions

The following are some critical questions you should ask

in analyzing your particular problem of check and card

fraud. (Depending on the local circumstances, you may

need to focus on one specific type of fraud. In general, it

is best to focus on one small aspect of the problem at a

time, such as a single merchant or bank.) Your answers to

these questions will help you choose the most

appropriate set of responses later on.

Incidents

• Have checks or cards been targeted in other crimes

such as burglaries of homes and offices, pickpocketing

in shopping malls, muggings, and thefts from cars? 

• When you receive reports of check or card fraud, what

kinds of offenses do they usually entail: check

alteration, card counterfeiting, assaults at ATMs,

Internet fraud, etc.? 

• Who typically reports these crimes: checking or card

account holders, retailers, banks, or card issuers?

• Is online fraud (from card-not-present sales) a problem

in your area? Online fraud may become apparent when

fraudsters order online but arrange to pick up

merchandise at the store. Do merchants report any

such instances?
14 Check and Card Fraud

• Are there any cases of parcels stolen or "lost" during

delivery of items ordered online? 

• Are there known fencing operations in or near your

area? If so, what kinds of items are most commonly

fenced, and are they traceable to any local stores? Do

new items frequently appear in pawnshops?

• What national, regional, or local databases do public or

private agencies maintain concerning check and card

fraud?

Offenders

• Do fraudsters work alone, or in groups? How many

work alone? How many work with others? How and

where do they get together? How do they offend

together? Why do they offend together? (Arrested

offenders are a good information source, but remember

that they may differ from active fraudsters in important

ways. In addition, they may be reluctant to share

information if they are concerned about three-strikes

laws.)

• What are fraudsters' demographic characteristics, such

as age and gender? What is their ethnicity, as this may

relate to the source of counterfeit or stolen cards, or

the targeting of victims?

• Where do fraudsters live, work, or hang out?

• Do they know their victims?

• How active are fraudsters? Do particular offenders

account for a few frauds, or many? Do they specialize

in one particular type of check or card fraud?

• What, specifically, motivates fraudsters? Do they need

quick cash to party or to support a family? Are they

addicted to drugs, and if so, to what? Are they recently

jobless, or are they long-term offenders? 
Understanding Your Local Problem 15

• Do they show evidence of planning their crimes, or do

they take advantage of easy opportunities?

• What special skills and techniques do they use to

commit their crimes?†

Victims

• How do individuals respond to their victimization? (It

is likely that you will rarely speak with cardholders,

because they usually report stolen cards to the card

issuers, rather than to the police.) 

• Are particular individuals repeatedly victimized? If so,

why?

• How do businesses respond to their victimization? Do

they routinely report check and card fraud to the

police? (Some may be unwilling to do so for fear that

police attention will drive business away, or, in the case

of card fraud, because they do not have to bear the

loss.) What kinds of stores report fraud: small family

stores, large retail chains, supermarkets, local or

regional banks, etc.? Why do they report it?

• What are merchant attitudes regarding police

involvement in dealing with fraud? 

• What procedures do they have for detecting or

preventing fraud?

• Are particular businesses repeatedly victimized? If so,

why?

Locations/Times 

• Does check and card fraud occur in a specific area, on a

particular day, and/or at a particular time? 

• Are specific types of places targeted, such as

supermarkets, electronics stores, retail chains,

restaurants, or online stores?

† In one study, fraudsters had

worked out over 100 different ways

of committing credit card fraud

(Jackson 1994). In another,

offenders displayed considerable

innovation in switching from one

technique of check forgery to

another (Lacoste and Tremblay

2003).
16 Check and Card Fraud

• Do muggings or thefts from cars that entail theft of

credit cards occur in neighborhoods where drug dealing

is common?

• Does fraud occur at checkout in local stores?

• How do fraudsters travel to and from the scene? 

• If fraudsters make "card-not-present" purchases, do

they use the telephone or the Internet? Do they call

stores from home or from public phones? Do they

access online stores from home computers or those

available in public places (e.g., college campuses, public

libraries, Internet cafés)?

Measuring Your Effectiveness

Measurement allows you to determine to what degree

your efforts have succeeded, and suggests how you might

modify your responses if they are not producing the

intended results. You should take measures of your

problem before you implement responses, to determine

how serious the problem is, and after you implement

them, to determine whether they have been effective.

(For more detailed guidance on measuring effectiveness,

see the companion guide to this series, Assessing Responses

to Problems: An Introductory Guide for Police Problem-Solvers.)

It should be emphasized that some measures will depend

on merchants' providing information and establishing

systematic procedures for collecting the data you need.

You will need to convince merchants that the lossprevention benefits will offset the data-collection costs,

and that data collection is necessary for a cost/benefit

analysis.
Understanding Your Local Problem 17

The following are potentially useful measures of the

effectiveness of responses to check and card fraud:

• Fewer repeat offenders.

• Increased reporting of check and card fraud.

• Decreases in retail losses attributed to check and card

fraud. Retailers may use the number of transactions, or

the total amount of sales, as the base against which

they compute losses.

• Differences in reported frauds between stores or banks

where you focus your activities and those where you do

not (keeping in mind that changes may be due to other

factors, and that reported crime does not always reflect

actual crime).

• Reductions in related crimes such as burglaries, thefts

from cars, or robberies at ATMs where credit or

bankcards may be a prime target (keeping in mind that

changes may be due to other factors related to those

crimes).24

• Increases in some related crimes when fraudsters'

efforts are thwarted and they shift to easier targets

(displacement). One study has suggested that

acquisitive crime may increase as credit card fraud

decreases.25 Other studies have found that fraudsters

tend not to switch easily between different types of

credit card fraud26 though they are resourceful in

shifting between different types of check fraud, or at

least in inventing new ways to commit check fraud.27

• Reductions in the amount of new products fenced or

available in pawnshops.

• Fewer reports of lost or stolen goods purchased for

home delivery.

Responses to the Problem of Check and Card Fraud 19

Responses to the Problem of Check and

Card Fraud

Your analysis of your local problem should give you a

better understanding of the factors contributing to it.

Once you have analyzed your local problem and

established a baseline for measuring effectiveness, you

should consider possible responses to address the

problem.

This section reviews what is known about the

effectiveness of various practices in dealing with check

and card fraud. Unfortunately, the information is severely

limited because few of the common preventive practices

have been evaluated. Card issuers, retailers, and bankers

have been reluctant to conduct the necessary studies, or to

share the results of those they do conduct. The

government has funded little research in this field,

generally regarding it as the private sector's domain.

The following response strategies provide a foundation of

ideas for addressing your particular problem. It is critical

that you tailor responses to local circumstances, and that

you can justify each response based on reliable analysis. In

most cases, an effective strategy will involve implementing

several different responses. Do not limit yourself to

considering what police can do: give careful consideration

to others in your community who may share responsibility

for the problem. It will be essential to work closely with

local businesses and community groups. The most

effective program to reduce check and card fraud reported

to date involved banks, retailers, business associations,

database administrators, and local, regional, and national

police.28
20 Check and Card Fraud

General Considerations for an Effective Response

Strategy

As noted, local police can do little on their own to prevent

check and card fraud. In many cases, you will have to

persuade local bankers and merchants to act. You may

have to explain why police can achieve little using

traditional responses such as surveillance and arrest, and

why heavier court sentences are of limited value. You may

want to explain to merchants that the way they process

check and card payments may be contributing to the

problem. You may have to convince retailers and bankers

that they cannot ignore the problem, because the costs to

the community are too great and, in the long run, the

stores and banks themselves suffer. Finally, you will need

to advise them on preventive measures they can take to

reduce the problem.

It is important that responses be selective and based on a

thorough understanding of the particular circumstances.

For example, fraudsters often target high-priced electronic

gadgets and appliances because they promise more cash.29

Or, it might be better to concentrate on preventing check

and card fraud by casual offenders, who are easier to deter,

than to focus on the much smaller number of

"professionals," who are harder to defeat. Again, such

choices depend on your local circumstances. In framing

advice, you must think carefully about the nature of the

risk, which varies greatly depending on the kind of store

and goods offered; the types of cards accepted; the store's

check-cashing policies; and the store's or bank's marketing

practices. These factors determine the nature of the

remedies. Department stores with huge turnovers of

expensive goods can afford to spend much more on

security than small retailers can, and their corporate

headquarters often dictate security procedures.† In all

† Most large retail stores now have

standard antishoplifting technology, such

as item tagging, tracking, etc. However,

such technology cannot prevent card

fraud at checkout. People commonly do

not notice their credit cards are missing

until a day or more after their loss.

Unlike shoplifters, card fraudsters are in

no immediate risk of being detected or

of setting off alarms. Thus it may be

expected that, as technology makes

shoplifting more and more difficult,

thieves may turn more to card fraud.
Responses to the Problem of Check and Card Fraud 21

cases, you must appreciate stores' need to make a profit. It

cannot be emphasized enough that the success of your efforts will

depend heavily on how well you can convince local retailers that

improved security procedures can and do increase the bottom line. In

making your case, you may need to:

• calculate the likely cost of measures such as installing a

computerized customer database and issuing customers

ID cards for check cashing;

• convince retailers that they can recoup the cost of

increased security through reduced losses from fraud

(e.g., item replacement, profit, and lawsuit losses);

• enlist the support of the local Chamber of Commerce

or other business organizations in persuading business

owners to improve security; and

• brief (with care) the local media on the problem and

the proposed solutions.

Working with Businesses

1. Raising responsibility awareness. As noted, many

card issuers and banks do not hold cardholders liable for

losses if their card is lost or stolen. Nor, in many cases, do

they hold the merchant who accepts the card liable.

Similarly, although merchants and banks incur losses from

bad checks, they are reluctant to implement the security

procedures necessary to prevent these losses, because they

believe customers (especially regular customers) are

"turned off" by being asked for ID. Yet research has

shown that simply requiring two forms of ID for check

cashing can significantly reduce the rate of fraudulent

checking (see response #3). You must convince card

issuers, banks, and merchants that any monetary losses due

to fraud are serious losses both to them and to customers
22 Check and Card Fraud

(who, of course, eventually bear the ultimate loss through

higher prices and higher card interest rates). Perhaps

worse, though, is the harm done to the community when

identity theft is part of the fraud, because of the loss of

trust it causes.† All parties concerned must be convinced

of their responsibility:

• merchants and bankers: to adopt antifraud procedures;

• card issuers: to adopt marketing techniques that do not

offer opportunities to potential fraudsters: and 

• customers: to take security precautions with their cards

(for example, not leaving their purses or wallets in a

locked car).

2. Increasing the reporting of fraud. You should try to

persuade local retailers and bankers to report fraud so that

you can get some estimate of both the extent and the

pattern of the problem. This will help you to raise

awareness of the problem and to pinpoint businesses

experiencing a higher rate of fraud. However, you must

take care to ensure that any reporting of incidents be

linked to a planned preventive program, not done merely

"to add information to police records." That is to say, data

collection must have a specific preventive purpose. You

must also take care that police action resulting from

increased reporting of fraud does not receive publicity

that may negatively affect merchant activity, or be

perceived to do so. Unless there is an active and positive

program linked to reporting fraud, negative publicity can

easily ensue.30

† The 2000 British Crime Survey

(Home Office 2000) found that 50

percent of respondents reported

being fairly worried or very worried

about credit/bankcard fraud–more

than for mugging/robbery or

physical attack.
Responses to the Problem of Check and Card Fraud 23

3. Verifying checks, cards, and users. Check and card

manufacturers have introduced an impressive array of

technological features that make counterfeiting or

alteration very difficult. However, two significant facts

work against them:

• Committed counterfeiters can easily match

technological developments because all the equipment

they need is relatively cheap and widely available on the

Internet.

• Counterfeit checks and cards do not need to be all that

good. They just need to get by what is usually only a

cursory or inadequate checkout inspection.31 Even

amateurs who simply need a small amount of cash

quickly to buy food or drugs can often avoid detection

at checkout.

Thus, while local police may not be able to get at the

source of many counterfeit cards (Asia), they can do

something about where counterfeit cards and checks are

used (checkout), if they work with the merchants

concerned.

You can do much to inform merchants about modern

verification procedures, particularly small businesses that,

unlike large retail chains, may not have ready access to

account and cardholder databases. Many police department

websites offer lists of specific actions merchants can take

to detect check and card fraud at checkout. In general,

sales clerks must do the following:

• Verify that the check or card is legitimate and

represents a legitimate account. In the case of cards,

this is usually done electronically by transmitting the

card information to a central card-issuer database.
† Since the late 1990s, U.S. retailers

have increasingly required a customer

thumbprint (using special invisible

ink) to accept checks. Some police

departments provide the ink for free

to local retailers. However, unless

police work closely with retailers,

retailers may fear this requirement

will have a negative effect on

customers, who may consider it an

invasion of their privacy (even

though the print is used only if the

check turns out to be fraudulent).

24 Check and Card Fraud

• Verify that the person offering the check or card is the

account holder. Sales clerks typically do this by

checking the customer's signature. Unfortunately, it is

widely known that a signature alone is a very poor

verification of customer identity. So there is a very high

probability (over 60 percent) that someone using, say, a

stolen check or credit card will get away with it at

checkout.

Researchers have shown that adding simple security

procedures can significantly reduce check and card fraud.

In one U.S. study in a retail store,32 a system that used

picture IDs of customers who paid with credit cards

reduced fraud by over 80 percent. Furthermore, retail

stores (especially supermarkets) have found that customer

databases that issue customers ID cards can also be used

as an effective marketing tool to advertise special sales and

promotions. A study in Norway33 showed that legislation

requiring people to show two forms of ID when cashing

checks reduced check fraud by over 80 percent.†

A sales clerk checks a customer’s thumbprint.
Responses to the Problem of Check and Card Fraud 25

While these simple measures seem obvious and

commonsense, if you visit any retail store and observe the

security procedures for verifying checks or cards, you will

see that sales clerks rarely or only casually use the ones

described here. As noted, merchants often do not implement

such procedures because they fear the negative effect they

may have on sales. There is, however, no research to justify

this view–although there is research that suggests that

checkout delays do reduce sales. Therefore, you must take

these concerns into account if you try to get local merchants

to change their security procedures. Simply informing them

about security possibilities is not enough. To avoid the

negative effects of checkout delays, a carefully planned

system has to be developed. This may require the input not

only of the merchants, but also of security experts. Finally,

an evaluation of the program's effectiveness must be built in to show

that the savings from frauds prevented more than offset the cost of

implementing the program. Without this assurance, retailers are

unlikely to adopt security procedures.†

4. Training checkout staff. As noted in the previous

response, introducing new technology and procedures to

identify illegal credit card use or fraudulent check cashing

will be of little help if the staff who are required to check

IDs are not trained to do so effectively. Ideally, a

combination of technology (e.g., biometric techniques) and

procedures that make identity verification independent of

sales clerks' judgment would be the solution. The

introduction of PINs for credit cards (as with debit cards)

has been shown to substantially reduce credit card fraud in

Europe, but widespread introduction will take several years.

Using thumbprint, black light, and other biometric

techniques to validate checks also shows promise.34

† A simple, inexpensive, and quick

procedure that can be done without

checkout delays is to use black light

to check for counterfeit cards. All

major cards (MasterCard, Visa,

American Express, and Discover)

contain images that are visible under

black light. The Troy (N.Y.) Police

Department has successfully

implemented this procedure.
26 Check and Card Fraud

In the meantime, there are three important ways you can

help businesses train staff:

• Work with business associations or specific businesses

to play a role in their training of new and continuing

staff. In training sessions, you should work to raise

staff's responsibility awareness (see response #1), for

you can be assured that if the general business attitude

is that card fraud is simply a cost of doing business,

that attitude will show in the everyday practices of

checkout staff.

• You should also inform staff of the known methods of

check-cashing fraud and illegal card use that involve

collusion with sales clerks, and inform them of the

dangers of participating in such offenses. Keep in mind

that, by various estimates, some 50 percent of

"shrinkage" (loss of stock in a retail store due to any

cause) is attributed to employee theft. For this reason,

if a business has an especially serious fraud or theft

problem, it may be advisable to install closed-circuit

television (CCTV) cameras at checkouts. This step

should, however, be a last resort, because CCTV

requires carefully planned and defined implementation,

usually requiring the services of an experienced security

professional for installation and, especially, evaluation.35

• You should encourage the merchant to conduct–and,

where legally appropriate, you should assist with–

background checks on new employees. The U.S.

Chamber of Commerce estimates that some 30 percent

of all business failures result from employee theft. If

businesses hire honest employees, then the risk of

collusion with customers at checkout is obviously less.

As with other responses in this section, you will need to

gain a considerable amount of trust from businesses–and,
Responses to the Problem of Check and Card Fraud 27

where appropriate, security professionals–to participate in

staff training. You must make your role and goals very

clear to businesses, so they know you are not out to find

something amiss in their business practices.†

5. Reducing card application fraud. By far the biggest

contributor to application fraud is the huge volume of

invitations to apply for cards sent out in the mail every

day, and available on the Internet. Fraudulent applications

are very easy to complete using false personal

information.36 In general, local police cannot do much

about this–it is a problem of national and international

proportions. However, there are three types of local card

application fraud:

• Getting new cards using a stolen identity.

• Intercepting card renewal mail or other mail that

contains a person's identifying information (some

postal employees have done this).

• Surveilling mail delivered to vacant houses, such as

those for sale, or obtaining credit card applications by

not forwarding mail to a previous resident. (In this

case, you can work with real estate agencies and the

post office to ensure that card renewal letters reach

their proper destination. Since vacant residences may be

located in several different mail-delivery areas,

coordination with the post office may be very difficult.)

6. Using information to fight online card fraud.

Offenders make online or telephone card-not-present

purchases from retail stores that are most likely out of

state or even abroad, beyond local police jurisdiction. A

significant amount of card application fraud also occurs

when people apply for cards either online or by telephone.

As distant as such frauds may seem to local police, the fact

† Unfortunately, there are

merchants who set up bogus

companies to collude with cooffenders to process fraudulent

purchases made with credit cards, or

to defraud honest cardholders.

Merchant-alert databases have been

successfully used in the United

Kingdom to identify fraudulent

merchants and warn honest

cardholders of possibly risky

locations and businesses (Levi and

Handley n.d.).
28 Check and Card Fraud

remains that they are committed by people who live in

particular jurisdictions, and at the other end, fraud victims,

whether merchants or individual cardholders, also live in

particular jurisdictions. Depending on your department's

resources (some large departments have specialized fraud

and electronic-crime squads), you can take some practical

steps (limited though they might be) to counteract at least

the effects of fraud, and perhaps prevent some of it from

occurring. You can do this by using the most powerful

tool available in the 21st century–information:

• In 2002, the FBI set up a computer crime squad that

has considerable technical and prosecution capabilities.

The U.S. Justice Department also issues updates on

current frauds and scams, and on where they are

occurring in the United States.

• Check with the major online websites that specialize in

collecting information about frauds and scams in

general, credit card frauds, and other fraud-related

crime that occurs on the Internet. Many sites provide

useful information on how to identify various frauds

and how to protect against victimization (see list in

box).
Responses to the Problem of Check and Card Fraud 29

Useful Internet Sources

Association of Payment Clearing Services: www.cardwatch.org.uk/

Better Business Bureau: www.bbb.org/

CERT/CC. Carnegie Mellon University repository of reported hacking incidents:

www.cert.org/stats/cert_stats.html

Credit Federal: www.creditfederal.com/credit-card-fraud-prevention.htm

Crime Prevention Service: http://crimeprevention.rutgers.edu/

FBI National Computer Crime Squad, through the Washington Field Office: email

nccs@fbi.gov, or call 202.324.9164

FBI Washington Field Office: www.nipc.gov/sites/ipcis/ipcis.htm

Federal Citizen Information Center: www.pueblo.gsa.gov/scamsresources.htm

Federal Communications Commission, Consumer and Governmental Affairs Bureau:

www.fcc.gov/cgb/information_directory.html

Federal Trade Commission: www.ftc.gov/

International Web Police: www.scamwatch.com/

Netcheck.com: www.netcheck.com/

US Department of Justice: www.usdoj.gov/criminal/fraud.html

Most states have websites for their attorney general's office, many of which provide updates and

advice on current and past scams:

New Jersey Office of the Attorney General: www.state.nj.us/lps/oag/index.html

Office of New York State Attorney General: www.oag.state.ny.us/ 
30 Check and Card Fraud

• Because of the risks involved in maintaining massive

online databases of individual cardholder information,

businesses should (and increasingly do) develop and

clearly publicize a privacy policy to ensure their

customers that their personal information is safe, and

will not be used for any other purposes except

purchases. Small local businesses can increasingly

accept credit card payments online as web-purchasing

software becomes cheaper and easier to install on small

websites. You can help local businesses by providing

any available information on privacy policies and

procedures. This may involve simply providing website

addresses as part of maintaining a productive working

relationship with local businesses. You should not

assume that businesses, especially small ones, are well

acquainted with such information, since many hire

website developers to design their websites and may

have limited knowledge of the risks involved in web

retailing.

• As an information provider, you may be able to help

small businesses get connected to services that

maintain databases of card-use patterns. Currently, the

major card issuers (e.g., Visa, MasterCard, and

American Express) provide this service, which analyzes

card use and detects any abnormal patterns. This

service has significantly reduced card fraud by not only

flagging unusual card use,† but also errant merchant

processing. Stores that issue check-cashing cards could

also use this service.

The obvious difficulty with this response is that it does

not focus as much on a specific crime as is usual in

problem-oriented policing, but instead entails a more

general approach of enhancing police-business relations.

Thus, although it may help in implementing some of the

† Visa claimed card fraud

reductions of up to 20 percent after

it introduced software that detected

unusual spending patterns

(Maremont 1995).
Responses to the Problem of Check and Card Fraud 31

other responses described in this section, it may be

difficult to evaluate its specific effects on online credit

card fraud.

7. Tracking products. Legitimate cardholders sometimes

use the following techniques to commit online card fraud:

• They deny having made a purchase and insist the item

was not delivered.

• They say they made a purchase (it was charged to their

account), the item was not delivered, and they want a

refund.

In the first case, local police can do very little. But in the

second, they might work with delivery companies to

locally track items bought online. Tracking technology is

revolutionizing retailing and many other business areas,

and it is certainly at the operational core of UPS, Federal

Express, and other delivery companies. Small transmitters

are rapidly replacing bar coding, the most pervasive

tracking technology of the late 20th century. These

transmitters can be placed on retail items (they have

proved particularly effective in reducing shoplifting),37

vehicles (including delivery vehicles),38 pets, livestock, and

even people. They can be programmed to hold substantial

information and to transmit location. Such devices make

the recovery of stolen items much easier and can precisely

track the delivery of products. Indeed, some companies

already provide this service for stolen cars and trucks.39

Because of the massive increase in online retailing, many

more products are delivered to the home, creating

opportunities for theft en route. The following are ways

you can help businesses verify product delivery and detect

possible card fraud:
32 Check and Card Fraud

• Work with Neighborhood Watch and local delivery

companies to ensure that deliveries to residences where

no one is home are left in safe places. Using focused

Neighborhood Watch programs is one of many ways to

ensure safe deliveries.40

• Fraudsters claiming nondelivery may give a bogus

address (perhaps that of a vacant house) to get the

item. Working with real estate agencies (see response

#5) to track vacant local residences may help reduce

such opportunities.

• Work with local retail chains from which customers can

purchase products online. Credit card fraudsters

commonly return items to the store for a refund.

Patterns of product return and cases of excessive

returns should be monitored.

The amount of card fraud committed through nondelivery

claims is probably quite low, though there are no data to

support this assumption. There may be high rates of

product theft from delivery vehicles in some densely

populated urban areas.41 You may have to balance your

delivery-monitoring efforts against competing demands on

police time. But bear in mind that your responses to

delivery theft may also work in reducing other crimes, such

as selling stolen goods, returning stolen goods for refunds,

and shoplifting.

8. Raising perceptions of wrongdoing and risk.

Reminding would-be shoplifters that shoplifting is a crime

and warning them that they will be prosecuted can help

reduce shoplifting.42 Stores commonly post signs to that

effect. As noted above, making purchases via check or

card fraud is a form of shoplifting, but with much less

risk. A simple sign such as "WE REQUIRE ID FOR

CHECKS AND CARDS" indicates that the business takes
Responses to the Problem of Check and Card Fraud 33

IDs seriously. Sign placement may depend on a store's

particular patterns of theft, procedures for processing

check and card payments, and ways of dealing with

customers. Putting up a sign costs very little, and

monitoring its effectiveness is relatively straightforward.

Of course, this presumes that stores keep records of

check or card fraud incidents.

Community Partnerships

9. Educating cardholders. Although cardholders are not

liable for losses if their credit cards are lost or stolen, they

may be liable for many other card-related thefts. And if

their entire identities are stolen, they may suffer

considerable financial loss. Customer education

concerning practical precautions to avoid identity theft,

including credit card and bank account access, may

contribute substantially to preventing fraud. These

precautions may include:

• carrying only a minimum of cards in high-risk

neighborhoods;

• covering the keypad when punching in a PIN at an

ATM, or a card number and PIN on a telephone, to

prevent a passerby or someone using binoculars from

seeing your number;

• never giving out personal information (e.g., Social

Security, credit card, or bank account numbers) over

the phone to telemarketers or anyone claiming to be

collecting money for charity;

• never responding to online requests for personal or

card information unless they are on a trusted website;

• never buying from an online retailer unless the website

has a clear statement about the security measures it

takes with its personal information databases, and

about its online privacy policy;
34 Check and Card Fraud

• never leaving credit or bankcards in a vehicle, whether

locked or unlocked (these are among the most common

items stolen from cars);43

• never letting anyone (including family members) use

your debit or credit card, or know your PIN;

• watching carefully how sales clerks process your credit

card and, if the store still uses mechanical cardprocessing devices, making sure that copies of receipts

are destroyed; and

• not using publicly accessible computers (e.g., in

libraries or Internet cafes) to make online purchases,

because hackers may later retrieve your personal data.

Who should tell cardholders about these precautions?

Local police do not have the ready access to customers

that merchants and card issuers do: it is much easier for

merchants and card issuers to provide crime prevention

information along with customer bills and statements, or

on ATM welcome screens. However, police do have access

to two groups of customers (or potential customers):

those who are typically targets of scams–senior citizens–

and those who know little about banking or using credit

cards–children. With the cooperation of local businesses

and community groups, police could set up educational

programs to give talks to senior citizen groups, and to visit

schools to talk to students about responsibly managing

personal information, bank accounts, and payment cards.†

While it would be sensible to target high school students,

as some either already use credit and debit cards, or soon

will, there may be good reason to target younger students

as well, as they increasingly use the Internet. Of course,

the effectiveness of such a program will be difficult to

measure, since it requires a broad approach directed at

affecting future behavior.

† See the POP Guide on Financial

Crimes Against the Elderly.
Responses to the Problem of Check and Card Fraud 35

10. Publicizing the costs of fraud. Perhaps the biggest

challenge in dealing with fraud is changing attitudes

toward it. Offenders typically view merchants and banks as

rich and able to afford losses from fraud (one of their

"excuses" for breaking the law).44 Card issuers view fraud

as a cost of doing business. Police must allocate scarce

resources where they are most cost-effective. It seems

reasonable, then, given merchants' reluctance to report

credit card fraud and banks' reluctance to report check and

debit card fraud, for police to give such crime a low

priority. Yet don't merchants–who pay taxes–have at least

some right to expect the police to "do something" about

fraud when it directly affects their businesses?45 The

problem here is one of perception: who does fraud harm,

how much harm does it do, and who is responsible for

preventing it?

One response is to publicize what is known about fraud–

emphasizing its financial and human costs, and spelling

out the steps people can take to avoid becoming victims.

Response #2 entailed working with businesses to increase

the reporting of fraud, and response #1 suggested ways of

raising responsibility awareness among merchants, card

issuers, and customers. The most direct and–probably–

effective way to reach all those affected by fraud is

through the local media, which tend to be very interested

in reporting on crime victims.46 Police could write a piece

outlining the costs to both victims and police: for

example, it can take victims up to three months to

straighten out credit problems caused by stolen identity,

and may cost police up to $20,000 to investigate a case of

identity theft.47 As usual, you must take care to ensure that

any publicity is linked to a planned prevention program

agreed to by local business associations and merchants.
36 Check and Card Fraud

11. Collaborating with colleges. College students using

campus computers have committed some of the major

hacking offenses.48 Offenders have committed other

crimes, such as stalking and pornography-related offenses,

using Internet cafes and public libraries. As part of your

overall strategy, you might work with college computer

departments, to make sure that they have established a

clear and publicized policy on campus computer use,

outlining users' rights and responsibilities, and that they

can track computer use if a hacking incident is traced to

the campus. In addition, colleges are increasingly adopting

"smart" cards that students use to charge meals and buy

items from campus stores. You should work with colleges

to make sure they have taken precautions to prevent

fraudulent use of such cards and, if possible, work with

campus security to educate students about fraud

prevention. There is some indication that a fraud

prevention program may work best if combined with

programs to prevent other common campus crimes,49 such

as shoplifting and mobile phone theft. Bear in mind,

though, that different colleges have different traditions

and policies regarding local police participation in crime

prevention. They also carefully guard information about

crimes occurring on or near campus, for fear that publicity

may adversely affect college applications. You should be

sensitive to this issue and be aware that collecting the

necessary information or data to measure the effectiveness

of crime prevention programs may be difficult.

Enforcement 

12. Monitoring fencing outlets, pawnshops, and online

auctions. A major problem for check and card fraudsters

is converting goods into cash. At the local level, you can

be sure that the existence of fencing outlets may

substantially contribute to fraud and to retail theft, in
Responses to the Problem of Check and Card Fraud 37

general.50 Thus you should monitor any known outlets, as

well as monitor the flow of new items into pawnshops

and the sale of goods through online auctions. The

majority of auction websites now list the sellers' locations–

though these tend to be broad regions. However, since

research has shown that card fraudsters tend to operate

some distance from home,51 the broad regional

information is probably accurate enough. To make

monitoring the sale of stolen goods of use in preventing

fraud, you will need to have a close working relationship

with retailers, so that you can track the items. Today's

tracking technology will help in doing so.

13. Monitoring chat rooms, bulletin boards, and

bogus websites. Response #12 included monitoring

online auctions for sales of stolen goods. You may also

monitor chat rooms and bulletin boards where people

discuss acquiring counterfeit or stolen cards, hacking into

databases containing card information, and committing

card fraud. Have a look at alt.phreaking

(http://members.tripod.com/~SeusslyOne/FAQ.html) or

the various alt.hacker newsgroups

(http://newsgroup.netwings.ch/alt.hacker.html). It is not

difficult to join these chat rooms and bulletin boards, and

given the anonymity the Internet allows, it is relatively easy

to conduct "undercover" surveillance of them.

Unfortunately, finding out users' location is difficult

without the help of Internet service providers (ISPs) or

computer crime specialists.

You should be on the lookout for bogus websites, as well.

(Again, not much skill is needed to set up a website. Nor

does it cost much, if anything, to do so.) Fraudsters have

tricked many unsuspecting web users into sending credit

card and other personal information to bogus companies.
38 Check and Card Fraud

There are websites that constantly monitor the Internet

for such scams, so you should routinely visit these to

check on the latest incidents. Again, unless you have help

from an ISP or a computer crime expert, you may have

difficulty determining the location of the people operating

the scams. As suggested in response #6, you should keep

in close contact with nearby police departments that have

specialized computer crime departments, and with the

relevant state and federal agencies that monitor Internet

fraud. You can also check with the Better Business Bureau

or other local consumer-reporting agencies, as well as pay

attention to news reports, to find out if there have been

scams in your area.

14. Targeting high-risk merchants. Rates of check and

card fraud vary enormously, both between different chains

and between stores in the same chain. One study reported

that recoveries per fraudulent check ranged from

approximately one in 268 for one large chain, to one in 24

for another in a similar line of business.52 You must

develop a systematic way of collecting fraud information,

so that you can identify high-risk merchants in your area.

If collecting incident data is initially impossible (and it

probably will be), you should try other avenues such as

working with business associations to get a rough idea of

which businesses are victimized most. It is likely that

offenders target particular types of stores (such as large

electronics stores for card fraud, and supermarkets for

check fraud). Or they may target particular stores because

they are considered "easy." Using crime mapping,53 perhaps

with assistance from specialized task forces in the region

or from larger police departments nearby (see next

response), may also help in identifying high-risk

merchants. Once you have identified them, you should try

to build a working relationship with management to

implement fraud-prevention measures.
Responses to the Problem of Check and Card Fraud 39

15. Getting help from experts. If your police

department is in or near a big city, you probably have

access to a variety of experts who can help you. These

may fall into several categories:

• Professional security consultants. These experts

specialize in areas such as product scanning and

tracking, checkout fraud, CCTV, card authentication,

employee screening and training, and check verification.

You can find them through a simple web search.

• Specialist police units or individuals. Some police

departments have specialist units or individuals who

conduct fraud investigations. However, the extent to

which they address fraud proactively (with prevention

in mind) rather than reactively (from an investigative

viewpoint) is not known. Unless these units or

individuals adopt carefully planned preventive

programs, they may find themselves inundated with

incident reports from merchants who see the police as

the solution to their problems.54 For example, a 1995

Scottsdale (Ariz.) Police Department program

successfully addressed a serious case-backlog problem

in the check fraud bureau by adopting a team approach

to working with local merchants.55 Many police

departments in the United States and elsewhere have

special antifraud programs, though they vary

considerably in sophistication. A web search will reveal

hundreds of such programs, though few with a

problem-oriented approach.

• Regional or national squads. Some check and card

fraud is of a regional, national, or international scope.

For example, credit card counterfeiting and distribution

operations reach from Southeast Asia to North

America and Europe, requiring highly focused and

specialized squads to track down the perpetrators and
40 Check and Card Fraud

† If crackdowns are to work–and

they do in some cases, for some

crimes–they should be carefully

tailored to work with the other

responses described in this guide.

See the POP Guide on The Benefits

and Consequences of Police Crackdowns.

identify their manufacturing and marketing systems.56

There is a good chance that these organized crime

networks reach into your area; hence the importance of

working with regional and national squads. However,

bear in mind that, with a few notable exceptions, such

squads primarily (perhaps necessarily) focus on

investigating and prosecuting individual cases, and do

not use a problem-oriented approach.

Responses with Limited Effectiveness

16. Conducting crackdowns. There are some difficulties

with crackdowns. If, by "crackdowns," we mean intensive

campaigns to publicly catch and arrest perpetrators of

check and card fraud,† then we face a serious problem in

police-business relations. This is because retailers, and

even bankers, have a longstanding belief that a strong

police presence on or near their premises, especially when

arrests are likely, contributes considerably to negative

customer attitudes that translate into decreased business.

The reluctance of merchants to use thumbprints to verify

ID, even when strongly pressured to do so by police,

illustrates this problem.

17. Implementing business watch. The popularity of

Neighborhood Watch has spawned some attempts to use

that approach for businesses. However, unless business

watch is clearly oriented toward solving a specific problem

(e.g., the reduction or prevention of check fraud at

supermarkets), in contrast to reducing business crimes in

general, it is likely to fail for want of focus, enthusiasm,

and participation. Business owners must have specific

crime-prevention goals if they are to devote the time and

effort needed to make the program work.57
Responses to the Problem of Check and Card Fraud 41

18. Handling offenders through means other than the

criminal justice system. Check and card fraud offenders

who are reported to the criminal justice system tend to

receive a low priority in processing, resulting in extensive

case backlogs.58 Rather than formally report people who

commit crimes against businesses (e.g., shoplifting, drugand alcohol-related misdemeanors, vandalism), many

jurisdictions opt for informal procedures, issuing warnings

to offenders, requiring that they compensate their victims,

and/or requiring that they get counseling. These

alternatives to the regular criminal justice system are

usually reserved for juveniles and depend heavily on

community–and, in the case of shoplifting, business and

shopping mall security–involvement. No research exists on

whether these alternatives would work for check and card

fraud, nor has research established the extent to which

juveniles are involved in such fraud. What data are

available suggest that check and card fraud offenders tend

to be adults, with an occasional preponderance of drug

users and college students. However, without research that

examines the entire range of behaviors that make up check

and card fraud, it is difficult to predict whether any

criminal justice or quasi-criminal justice procedures that

effectively address shoplifting could also be applied to

fraud.
42 Check and Card Fraud

19. Conducting publicity campaigns. We have

recommended establishing educational programs to help

people avoid being fraud victims (response #9), and

publicizing the economic and human costs of fraud

(response #10). These responses must be part of a

broader business and community initiative, not solely a

police initiative (as with "lock your car" campaigns). In

fact, a study of a Stockholm, Sweden campaign failed to

demonstrate any measurable effect on the rate of theft

from cars. The campaign looked more promising, however,

when combined with security measures such as

environmental changes to enhance natural surveillance.59
Appendix 43

Appendix: Summary of Responses to

Check and Card Fraud

The table below summarizes the responses to check and

card fraud, the mechanism by which they are intended to

work, the conditions under which they ought to work best,

and some factors you should consider before

implementing a particular response. It is critical that you

tailor responses to local circumstances, and that you can

justify each response based on reliable analysis. In most

cases, an effective strategy will involve implementing

several different responses. Law enforcement responses

alone are seldom effective in reducing or solving the

problem.

1.

2.

21

22

Raising

responsibility

awareness

Increasing the

reporting of

fraud

Local businesses

and card issuers

are encouraged

to take more

responsibility for

preventing fraud

Data collection

allows police to

determine the

extent of the

problem in their

area

...police

emphasize the

community costs

of fraud to

merchants

...it is combined

with a preventive

program (see

response #3)

Many security,

card-issuing, and

verification

policies are

dictated by

national and

international card

issuers, bankers,

and retail chains,

making it difficult

to change local

practices

The media may

portray increased

reporting of

incidents as a

"crime wave"

demanding a

police crackdown,

rather then an aid

to planned

preventive

procedures

Response

No.

Page No. Response How It Works Works Best If... Considerations

Working With Businesses
44 Check and Card Fraud

3.

4.

5.

6.

23

25

27

27

Verifying checks,

cards, and users

Training

checkout staff

Reducing card

application fraud

Using

information to

fight online card

fraud

Retailers with

high check or

card fraud losses

are targeted, and

verification

procedures are

established 

Regular staff

training raises

awareness about

fraud prevention 

Vacant

residences and

newly occupied

residences where

credit card

information may

be sent are

identified

Specified

websites alert

users to online

fraud

...verification

procedures are

integrated into

the established

checkout

practices, and an

evaluation

demonstrates

costeffectiveness

...police

establish a close,

trusting

relationship with

businesses and

clearly

communicate

goals 

...police work

closely with

postal employees

and real estate

agencies to

ensure that mail

is not delivered

to unoccupied

residences, and is

forwarded to the

appropriate

people

...police provide

prevention and

enforcement

information to

small local

businesses

Merchants may

resist spending

money on

verification,

especially if it

requires investing

in new technology

and changing

checkout

procedures

Merchants may

distrust police

attempts to

participate in staff

training sessions

Vacant residences

may be in several

different maildelivery areas,

requiring extensive

coordination with

the post office

It is difficult to

evaluate this

response's effect

on online fraud,

since it is

primarily directed

at enhancing

police-business

relations;

generally,

preventing online

fraud is beyond

the means of local

police

Response

No.

Page No. Response How It

Works

Works

Best If...

Considerations
Appendix 45

7.

8.

9.

10.

31

32

33

35

Tracking

products

Raising

perceptions of

wrongdoing and

risk

Educating

cardholders

Publicizing costs

of fraud

Police work with

delivery

companies, local

retailers, and

Neighborhood

Watch to

monitor product

delivery and

product returns

Retailers post

warning signs at

checkouts

Educational

programs teach

people to avoid

victimization by

taking simple

precautions

The media are

used to publicize

the financial and

human costs of

fraud

...manufacturers,

retailers, and

delivery

companies use

new tracking

technology

...retailers keep

records of check

and card fraud

both before and

after posting

signs, to measure

their

effectiveness

...it is combined

with crime

prevention

education about

a variety of

crimes for which

they may be

targeted

...police work

with businesses

and the media to

craft stories that

emphasize crime

prevention

Cost-effectiveness

may be difficult to

determine; tracking

may work in

reducing related

crimes such as

shoplifting and

theft of items in

transit

Merchants may

resist this

response,

inexpensive though

it is, for fear that it

will have a

negative effect on

law-abiding

customers 

This response

requires

considerable

cooperation from

community groups

and schools

Stories of

victimization may

affect businesses

negatively; media

treatment of

stories and

information may

be unpredictable;

effectiveness is

probably not

measurable

Response

No.

Page No. Response How It

Works

Works

Best If...

Considerations

Community Partnerships
46 Check and Card Fraud

11.

12.

13.

14.

15.

16.

36

36

37

38

39

40

Collaborating

with colleges

Monitoring

fencing outlets,

pawnshops, and

online auctions

Monitoring chat

rooms, bulletin

boards, and bogus

websites

Targeting highrisk merchants

Getting help

from experts

Conducting

crackdowns

Police encourage

colleges to

establish

responsible-use

policies for

computing

facilities, to

minimize hacking

Police work with

businesses to

develop strategies

to track goods

that may be

stolen

Police conduct

surveillance of

crime-facilitating

Internet venues

Police determine

what stores have

high rates of

fraud and focus

their efforts on

them

Experts on fraud

provide

information and

skills that may

help with local

problems

Police conduct

very public,

intensive

campaigns to

catch fraudsters

...it is combined

with crime

prevention

education about a

variety of crimes

for which they

may be targeted

...police acquire

extensive local

and regional

knowledge of

known fencing

and pawnshop

operations

...police get help

from ISPs and

computer crime

experts

...police work

with business

associations to

collect

information if

incident data are

not available

...police network

with professional

security

consultants and

fraud squads at

the local, regional,

and national level

Effectiveness is

difficult to measure,

and depends on

colleges' willingness

to invite local police

to their campuses to

help solve crime

problems

Local businesses

must cooperate in

identifying and

tracking goods

It is difficult to

determine whether

online fraudsters

live in your area

Information-sharing

requires a longterm, trusting

relationship

between police and

businesses

Fraud squads may

be investigationrather than

problem-oriented

Merchants may fear

that crackdowns

will drive business

away

Response

No.

Page No. Response How It

Works

Works

Best If...

Considerations

Responses With Limited Effectiveness

Enforcement
Appendix 47

17.

18.

19.

40

41

42

Implementing

business watch

Handling

offenders through

means other than

the criminal

justice system

Conducting

publicity

campaigns

Businesses set up

programs similar

to Neighborhood

Watch

Police and/or

businesses issue

offenders

warnings, require

victim

compensation,

and/or require

counseling rather

than make formal

criminal reports

Police alone

publicize fraud

risks 

...programs are

focused on

specific crimes,

rather than crime

in general

...it is combined

with the

implementation

of practical

security measures

Businesses must

have clear crimeprevention goals

This response has

usually been used

with juveniles who

have committed

other offenses; it

has not been

evaluated for check

and card fraud

Research has not

shown this

response, alone, to

be effective

Response

No.

Page No. Response How It

Works

Works

Best If...

Considerations

Endnotes 49

Endnotes

1 Levi and Handley (1998a); Association of Payment Clearing Services (2002);

www.epaynews.com/statistics/fraud.html 2 Association of Payment Clearing Services (2002);

www.epaynews.com/statistics/fraud.html 3 Levi and Handley (1998a). 4 Levi (1998). 5 U.S. General Accounting Office (2002). 6 U.S. House (1998). 7 Newman and Clarke (2003). 8 Newman and Clarke (2003). 9 Levi (2000). 10 Levi and Handley (1998a); Association of Payment Clearing Services (2002);

www.epaynews.com/statistics/fraud.html 11 Levi and Handley (1998b). 12 Taylor (2002). 13 Clarke and Newman (2002). 14 Levi, Bissell, and Richardson (1991). 15 Levi, Bissell, and Richardson (1991). 16 Duncan (1995). 17 Newman and Clarke (2003). 18 Newman and Clarke (2003). 19 Mann (2002). 20 Levi (2000). 21 Ekblom (2000). 22 Levi (2000); Levi and Handley (1998a, 1998b). 23 Mativat and Tremblay (1998). 24 Scott (2001). 25 Levi and Handley (n.d.). 26 Mativat and Tremblay (1997). 27 Lacoste and Tremblay (2003). 28 Levi, Bissell, and Richardson (1991); Levi and Handley (1998a). 29 Mativat and Tremblay (1997). 30 Scottsdale Police Department (1995).
50 Check and Card Fraud

31 Levi and Handley (n.d.). 32 Masuda (1996). 33 Knutsson and Kulhorn (1997). 34 Texas Banking (2001). 35 Pierce (2003); Clarke (2001a); Painter and Tilley (1999). 36 Levi and Handley (n.d.). 37 DiLonardo (1996). 38 McKinnon and Tallam (2002). 39 Newman and Clarke (2003). 40 McKinnon and Tallam (2002); Laycock and Tilley (1995). 41 McKinnon and Tallam (2002). 42 Clarke (1997); Clarke (2001b). 43 Clarke (2001a). 44 Clarke (1997). 45 Levi and Handley (n.d.). 46 Chermak (1995). 47 CALPIRG (2000). 48 Newman and Clarke (2003). 49 Sampson (2002). 50 Sutton (1995). 51 Levi (2000); Mativat and Tremblay (1997). 52 Levi, Bissel, and Richardson (1991). 53 Eck and Weisburd (1995). 54 Scottsdale Police Department (1995). 55 Scottsdale Police Department (1995). 56 Newton (1994); Mativat and Tremblay (1997). 57 Charlton and Taylor (2003). 58 Scottsdale Police Department (1995). 59 Clarke (2001a).
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Newman, G., and R. Clarke (2003). Superhighway Robbery:

Preventing Ecommerce Crime. London: Willan.

Newton, J. (1994). Police Research Award Scheme: Organized

"Plastic" Counterfeiting. London: Home Office Police

Department.

Painter, K., and N. Tilley (eds.) (1999). Surveillance of Public

Space: CCTV, Street Lighting, and Crime Prevention. Crime

Prevention Studies, Vol. 10. Monsey, N.Y.: Criminal

Justice Press.

Pierce, C. (2003). The Professional's Guide to CCTF Manual.:

www.ltctrainingcntr.com/.

Sampson, R. (2002). Acquaintance Rape of College Students,

Problem-Specific Guide No. 17. Problem-Oriented Guides

for Police Series. Washington, D.C.: Office of

Community Oriented Policing Services, U.S.

Department of Justice.
References 55

Scott, M. (2001). Robbery at Automated Teller Machines,

Problem-Specific Guide No. 8. Problem-Oriented Guides

for Police Series. Washington, D.C.: Office of

Community Oriented Policing Services, U.S.

Department of Justice.

Scottsdale Police Department (1995). "A Team Approach

to Saving the Check Fraud Bureau From Fiscal

Elimination." Submission for the Herman Goldstein

Award for Excellence in Problem-Oriented Policing.

Center for Problem-oriented Policing:

www.popcenter.org/Library/Goldstein/1995/95-

80.pdf.

Smith, R. (1997). "Plastic Card Fraud." Trends and Issues in

Crime and Criminal Justice, No. 71. Canberra, Australia:

Australian Institute of Criminology.

Sutton, M. (1995). "Supply by Theft: Does the Market for

Stolen Goods Play a Role in Keeping Crime Figures

High?" British Journal of Criminology 35(3):400–416.

Taylor, N. (2002). "Reporting of Crime Against Small

Retail Businesses." Trends and Issues in Crime and

Criminal Justice, No. 242. Canberra, Australia:

Australian Institute of Criminology.

Texas Banking (2001). "Thumbprint Signature Program

Fights Check Fraud." Texas Banking 40(1):9.

U.S. Comptroller of the Currency (1999). Check Fraud: A

Guide to Avoiding Losses. Washington, D.C.: U.S.

Comptroller of the Currency:

www.occ.treas.gov/pubs1.htm.
56 Check and Card Fraud

U.S. General Accounting Office (2002). Identity Theft:

Prevalence and Cost Appear to Be Growing. GAO-02-363

March. Washington, D.C.: U.S. General Accounting

Office: www.consumer.gov/idtheft/reports/gaod02363.pdf.

U.S. House (1998). Identity Theft and Assumption Deterrence

Act of 1998. 105th Cong., 2nd sess., H.R. 4151.

(1997). Committee on Banking and Financial

Services. Subcommittee on Domestic and

International Monetary Policy. Computer-Generated Check

Fraud. Washington, D.C.: U.S. Government Printing

Office.

Webb, B. (1996). "Preventing Plastic Card Fraud in the

UK." Security Journal 7(1):23.
About the Author 57

About the Author

Graeme R. Newman 

Graeme R. Newman is a distinguished teaching professor at

the School of Criminal Justice, University at Albany, State

University of New York. He has published works in the fields

of the history and philosophy of punishment, comparative

criminal justice, private security, situational crime prevention,

and ecommerce crime, and has written commercial software.

He was the CEO of a publishing company for 15 years and,

in 1990, established the United Nations Crime and Justice

Information Network. Among the books he has written or

edited are Superhighway Robbery: Preventing Ecommerce Crime

(with Ronald V. Clarke), and Rational Choice and Situational

Crime Prevention (with Ronald V. Clarke and Shlomo Shoham).

Recommended Readings 59

Recommended Readings

• A Police Guide to Surveying Citizens and Their

Environments, Bureau of Justice Assistance, 1993. This

guide offers a practical introduction for police practitioners

to two types of surveys that police find useful: surveying

public opinion and surveying the physical environment. It

provides guidance on whether and how to conduct costeffective surveys.

• Assessing Responses to Problems: An

Introductory Guide for Police Problem-Solvers, by

John E. Eck (U.S. Department of Justice, Office of

Community Oriented Policing Services, 2001). This guide is

a companion to the Problem-Oriented Guides for Police series. It

provides basic guidance to measuring and assessing

problem-oriented policing efforts.

• Conducting Community Surveys, by Deborah Weisel

(Bureau of Justice Statistics and Office of Community

Oriented Policing Services, 1999). This guide, along with

accompanying computer software, provides practical, basic

pointers for police in conducting community surveys. The

document is also available at www.ojp.usdoj.gov/bjs.

• Crime Prevention Studies, edited by Ronald V. Clarke

(Criminal Justice Press, 1993, et seq.). This is a series of

volumes of applied and theoretical research on reducing

opportunities for crime. Many chapters are evaluations of

initiatives to reduce specific crime and disorder problems.
60 Check and Card Fraud

• Excellence in Problem-Oriented Policing:The 1999

Herman Goldstein Award Winners. This document

produced by the National Institute of Justice in

collaboration with the Office of Community Oriented

Policing Services and the Police Executive Research Forum

provides detailed reports of the best submissions to the

annual award program that recognizes exemplary problemoriented responses to various community problems. A

similar publication is available for the award winners from

subsequent years. The documents are also available at

www.ojp.usdoj.gov/nij.

• Not Rocket Science? Problem-Solving and Crime

Reduction, by Tim Read and Nick Tilley (Home Office

Crime Reduction Research Series, 2000). Identifies and

describes the factors that make problem-solving effective or

ineffective as it is being practiced in police forces in

England and Wales.

• Opportunity Makes the Thief: Practical Theory for

Crime Prevention, by Marcus Felson and Ronald V.

Clarke (Home Office Police Research Series, Paper No. 98,

1998). Explains how crime theories such as routine activity

theory, rational choice theory and crime pattern theory have

practical implications for the police in their efforts to

prevent crime.

• Problem Analysis in Policing, by Rachel Boba (Police

Foundation, 2003). Introduces and defines problem

analysis and provides guidance on how problem analysis

can be integrated and institutionalized into modern

policing practices.
Recommended Readings 61

• Problem-Oriented Policing, by Herman Goldstein

(McGraw-Hill, 1990, and Temple University Press, 1990).

Explains the principles and methods of problem-oriented

policing, provides examples of it in practice, and discusses

how a police agency can implement the concept.

• Problem-Oriented Policing and Crime

Prevention, by Anthony A. Braga (Criminal Justice

Press, 2003). Provides a through review of significant

policing research about problem places, high-activity

offenders, and repeat victims, with a focus on the

applicability of those findings to problem-oriented

policing. Explains how police departments can facilitate

problem-oriented policing by improving crime analysis,

measuring performance, and securing productive

partnerships.

• Problem-Oriented Policing: Reflections on the

First 20 Years, by Michael S. Scott (U.S. Department of

Justice, Office of Community Oriented Policing Services,

2000). Describes how the most critical elements of

Herman Goldstein's problem-oriented policing model have

developed in practice over its 20-year history, and proposes

future directions for problem-oriented policing. The report

is also available at www.cops.usdoj.gov.

• Problem-Solving: Problem-Oriented Policing in

Newport News, by John E. Eck and William Spelman

(Police Executive Research Forum, 1987). Explains the

rationale behind problem-oriented policing and the

problem-solving process, and provides examples of

effective problem-solving in one agency.
62 Check and Card Fraud

• Problem-Solving Tips: A Guide to Reducing Crime

and Disorder Through Problem-Solving

Partnerships by Karin Schmerler, Matt Perkins, Scott

Phillips, Tammy Rinehart and Meg Townsend. (U.S.

Department of Justice, Office of Community Oriented

Policing Services, 1998) (also available at

www.cops.usdoj.gov). Provides a brief introduction to

problem-solving, basic information on the SARA model

and detailed suggestions about the problem-solving process.

• Situational Crime Prevention: Successful Case

Studies, Second Edition, edited by Ronald V. Clarke

(Harrow and Heston, 1997). Explains the principles and

methods of situational crime prevention, and presents over

20 case studies of effective crime prevention initiatives.

• Tackling Crime and Other Public-Safety Problems:

Case Studies in Problem-Solving, by Rana Sampson

and Michael S. Scott (U.S. Department of Justice, Office of

Community Oriented Policing Services, 2000) (also available

at www.cops.usdoj.gov). Presents case studies of effective

police problem-solving on 18 types of crime and disorder

problems.

• Using Analysis for Problem-Solving: A Guidebook

for Law Enforcement, by Timothy S. Bynum (U.S.

Department of Justice, Office of Community Oriented

Policing Services, 2001). Provides an introduction for

police to analyzing problems within the context of

problem-oriented policing.

• Using Research: A Primer for Law Enforcement

Managers, Second Edition, by John E. Eck and Nancy G.

LaVigne (Police Executive Research Forum, 1994). Explains

many of the basics of research as it applies to police

management and problem-solving.
Other Problem-Oriented Guides for Police 63

Other Problem-Oriented Guides for Police

Problem-Specific Guides series:

1. Assaults in and Around Bars. Michael S. Scott. 2001.

ISBN: 1-932582-00-2

2. Street Prostitution. Michael S. Scott. 2001. ISBN: 1-932582-01-0

3. Speeding in Residential Areas. Michael S. Scott. 2001.

ISBN: 1-932582-02-9

4. Drug Dealing in Privately Owned Apartment Complexes.

Rana Sampson. 2001. ISBN: 1-932582-03-7

5. False Burglar Alarms. Rana Sampson. 2001. ISBN: 1-932582-04-5

6. Disorderly Youth in Public Places. Michael S. Scott. 2001.

ISBN: 1-932582-05-3

7. Loud Car Stereos. Michael S. Scott. 2001. ISBN: 1-932582-06-1

8. Robbery at Automated Teller Machines. Michael S. Scott. 2001.

ISBN: 1-932582-07-X

9. Graffiti. Deborah Lamm Weisel. 2002. ISBN: 1-932582-08-8

10. Thefts of and From Cars in Parking Facilities. Ronald V.

Clarke. 2002. ISBN: 1-932582-09-6

11. Shoplifting. Ronald V. Clarke. 2002. ISBN: 1-932582-10-X

12. Bullying in Schools. Rana Sampson. 2002. ISBN: 1-932582-11-8

13. Panhandling. Michael S. Scott. 2002. ISBN: 1-932582-12-6

14. Rave Parties. Michael S. Scott. 2002. ISBN: 1-932582-13-4

15. Burglary of Retail Establishments. Ronald V. Clarke. 2002.

ISBN: 1-932582-14-2

16. Clandestine Drug Labs. Michael S. Scott. 2002.

ISBN: 1-932582-15-0

17. Acquaintance Rape of College Students. Rana Sampson. 2002.

ISBN: 1-932582-16-9

18. Burglary of Single-Family Houses. Deborah Lamm Weisel.

2002. ISBN: 1-932582-17-7

19. Misuse and Abuse of 911. Rana Sampson. 2002.

ISBN: 1-932582-18-5
64 Check and Card Fraud

20. Financial Crimes Against the Elderly.

Kelly Dedel Johnson. 2003. ISBN: 1-932582-22-3

21. Check and Card Fraud. Graeme R. Newman. 2003.

ISBN: 1-932582-27-4

22. Stalking. The National Center for Victims of Crime. 2004.

ISBN: 1-932582-30-4

23. Gun Violence Among Serious Young Offenders. Anthony A.

Braga. 2004. ISBN: 1-932582-31-2

24. Prescription Fraud. Julie Wartell, Nancy G. La Vigne. 2004.

ISBN: 1-932582-33-9

25. Identity Theft. Graeme R. Newman. 2004 ISBN: 1-932582-35-5

26. Crimes Against Tourists. Ronald W. Glensor, Kenneth J. Peak. 2004

ISBN: 1-932582-36-3

Response Guides series:

• The Benefits and Consequences of Police Crackdowns.

Michael S. Scott. 2003. ISBN: 1-932582-24-X

Problem-Solving Tools series:

• Assessing Responses to Problems: An Introductory Guide for

Police Problem-Solvers. John E. Eck. 2002. ISBN: 1-932582-19-3

Upcoming Problem-Oriented Guides for Police 

Problem-Specific Guides

Disorder at Budget Motels

Domestic Violence

Mentally Ill Persons

Robbery of Taxi Drivers

Student Party Disturbances on College Campuses

School Break-Ins

Street Racing
Other Problem-Oriented Guides for Police 65

Bomb Threats in Schools

Underage Drinking

Open-Air Drug Markets

Sexual Offenses in Public Places

Drunk Driving

Cruising

Bank Robbery

Response Guides

Closing Streets and Alleys to Reduce Crime

Problem-Solving Tools

Repeat Victimization

Using Offender Interviews to Inform Police Problem-Solving

Other Related COPS Office Publications

• Using Analysis for Problem-Solving: A Guidebook

for Law Enforcement. Timothy S. Bynum.

• Problem-Oriented Policing: Reflections on the First

20 Years. Michael S. Scott. 2001.

• Tackling Crime and Other Public-Safety Problems:

Case Studies in Problem-Solving. Rana Sampson and

Michael S. Scott. 2000.

• Community Policing, Community Justice, and

Restorative Justice: Exploring the Links for the

Delivery of a Balanced Approach to Public Safety.

Caroline G. Nicholl. 1999.

• Toolbox for Implementing Restorative Justice and

Advancing Community Policing. Caroline G. Nicholl.

2000.
66 Check and Card Fraud

• Problem-Solving Tips: A Guide to Reducing

Crime and Disorder Through Problem-Solving

Partnerships. Karin Schmerler, Matt Perkins, Scott

Phillips, Tammy Rinehart and Meg Townsend. 1998.

• Bringing Victims into Community Policing. The

National Center for Victims of Crime and the Police

Foundation. 2002.

• Call Management and Community Policing. Tom

McEwen, Deborah Spence, Russell Wolff, Julie Wartell

and Barbara Webster. 2003.

• Crime Analysis in America. Timothy C. O’Shea and

Keith Nicholls. 2003.

• Problem Analysis in Policing. Rachel Boba. 2003.

• Reducing Theft at Construction Sites: Lessons

From a Problem-Oriented Project. Ronald V. Clarke

and Herman Goldstein. 2003.

• The COPS Collaboration Toolkit: How to Build,

Fix, and Sustain Productive Partnerships. Gwen O.

Briscoe, Anna T. Laszlo and Tammy A. Rinehart.

2001.

• The Law Enforcement Tech Guide: How to plan,

purchase and manage technology (successfully!).

Kelly J. Harris and William H. Romesburg. 2002.

• Theft From Cars in Center City Parking 

Facilities - A Case Study. Ronald V. Clarke and

Herman Goldstein. 2003.

For more information about the Problem-Oriented Guides for

Police series and other COPS Office publications, please call

the COPS Office Response Center at 800.421.6770 or visit

COPS Online at www.cops.usdoj.gov.

FOR MORE INFORMATION:

U.S. Department of Justice

Office of Community Oriented Policing Services

1100 Vermont Avenue, N.W.

Washington, D.C. 20530

To obtain details on COPS programs, call the

COPS Office Response Center at 800.421.6770

Visit COPS Online at the address listed below.

e07042442 Updated Date: July 27, 2004

ISBN: 1-932582-27-4

www.cops.usdoj.gov