The US Department of Justice is cracking down on fraud networks that steal money from consumer bank accounts and then use 'microtransactions' to hide their activity.
The department has brought two civil cases and several criminal cases as part of its crackdown on networks of fraudsters that use unauthorised charges to steal money from consumers’ financial accounts.
The crooks often hide these unauthorised charges using 'microtransactions' which group the charges with a large number of low-value, straw transactions to lower the fraudster’s chargeback rate.
Principal deputy assistant Attorney General Brian Boynton, head of civil division, says: “The department is committed to using all of the tools at its disposal to prevent fraudsters from reaching into victims’ bank accounts and stealing their hard-earned savings.”
One of the civil cases alleges that a network stole millions of dollars from consumers and small businesses by making recurring unauthorised charges against their bank accounts.
The defendants allegedly took elaborate steps to portray the sham companies as legitimate businesses that provided online marketing services, creating bogus websites, fake customer authorisations for the charges and a “customer service” call centre to field complaints and offer refunds. In reality, victims of the scheme never signed up for - or received - any services from the fraudsters.
The complaint further alleges that some of the defendants used numerous sham microtransactions so that banks would not detect large numbers of chargebacks for unauthorised debits.