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One more reason not to use plastic

Rent extraction by criminals:

The U.S. Federal Trade Commission has disrupted a long-running online scam that allowed offshore fraudsters to steal millions of dollars from U.S. consumers -- often by taking just pennies at a time. ...

The FTC has not identified those responsible for the fraud, but in March, it quietly filed a civil lawsuit in U.S. District Court in Illinois. This has frozen the gang's U.S. assets and also allowed the FTC to shut down merchant accounts and 14 "money mules" -- U.S. residents recruited by the criminals to move money offshore to countries such as Bulgaria, Cyprus, and Estonia.

"We're going to aggressively seek to identify the ultimate masterminds behind this scheme," Wernikoff said. According to him, the scammers found loopholes in the credit card processing system that allowed them to set up fake U.S. companies that then ran more than a million phony credit card transactions through legitimate credit card processing companies.

The scammers stayed under the radar by charging very small amounts -- typically between $0.25 and $9 per card -- and by setting up more than 100 bogus companies to process the transactions.

U.S. consumers footed most of the bill for the scam because, amazingly, about 94 percent of all charges went uncontested by the victims. According to the FTC, the fraudsters charged 1.35 million credit cards a total of $9.5 million, but only 78,724 of these fake charges were ever noticed. Typically they floated just one charge per card number, billing on behalf of made-up business names such as Adele Services or Bartelca LLC.

Of course, "criminal" is just a word -- it applies only to Estonians who steal millions.

Because if you're on Wall Street and steal billions or trillions, you're Too Big To Fail, and can steal what you like with complete impunity.

As ever, the scandal is what's legal. So, as much as you can, get rid of your plastic and deny both the little thieves who get caught, and the big thieves who run the country, their life's blood: The rents.

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DCblogger's picture
Submitted by DCblogger on

my bank, Amalgamated, once questioned a charge from an obscure tea company, but it was legit, and delicious tea.

Amalgamated put a stop on my ATM card when charges began to show up in a different part of town than where I lived, but I was very grateful for their diligence. I have a very underwhelming balance on my account, but they treat me like royalty.

Move Your Money, service and security are MUCH better at credit unions and community banks.