A credit card generator has the potential for both good and evil. Since so many people are in debt in the United States, things that were once looked at as being illegal and wrong become more enticing. A credit card generator would definitely fall under this category. The generator takes the rules that credit card companies use to make their credit card numbers in order to create valid credit card numbers. While the primary reason to use a credit card number generator is to commit fraud, there are actually some legitimate uses for the generator. One of these uses is to test software.

So how do credit card generators work? If you have a keen eye then you have probably already noticed that different credit cards have different patterns. For example, every Visa credit card number starts with a “4” and every Mastercard number starts with a “5”. The generator then takes these rules and then generates thousands of numbers that fit the rules. Through the laws of basic probability, it is safe to assume that some of these generated numbers are actually real and active credit card numbers.

So how does the credit card fraud happen? Criminals have to either test each number to see if it is valid or they can also use a printer to make fake credit cards. They then take these credit cards to places that are not able to immediately validate them, such as a trade show. Most trade shows now use a wireless credit card reader to process credit cards live and avoid this kind of fraud.

In order to test the credit card numbers the criminal must make many tiny transactions (usually for only a few cents). The criminal sits at the computer for hours entering in each number and making tiny purchases of a few cents to indentify the numbers that work. To avoid being caught, the criminal will enter an address that is not their own. This will ensure they are not traced.

If a credit card generator download is so easy to obtain and the software is so easy to use, how can I protect myself? If you are a consumer then the best way you can protect yourself from this fraud is to cancel any credit cards that you do not use on a regular basis. If you only keep active credit cards then you greatly reduce your risk of a criminal stumbling upon your number and using your card to make purchases. Many people sign up for credit cards that are a part of a special promotion or special offer, only to forget about these cards. This is very dangerous and should be avoided at all costs.

As a consumer, you can also protect yourself by checking your account activity every billing period. If you see a charge on a credit card that you do not use then you should call your credit card company immediately. The sooner you respond to fraud the better the outcome will be. You will also help protect your credit score by catching this early.

As a merchant, the best way to protect yourself is by require additional verification information at the point of sale. The more verification you ask for, the less likely the fraud will take place. Here are a few things you should always ask your customers:

• The billing and shipping address. By making sure the billing and shipping match, you will avoid fraud because a credit card generator cannot replicate this.
• The credit card’s date of expiration. The software can create this, but it creates more  work for the criminal and criminals are lazy so it reduces your risk.
• The security code. This is the 3 digit code on the back of the card that credit card generators cannot make.

You last line of defense is to report any sort of behavior that seems out of the ordinary. This would include things like repeated attempts to charge small amounts or a series of small purchases.