Evolution of the PASSPORT CARD FRAUD SCHEME

The U.S. passport card is a REAL ID compliant identity and travel document issued by the U.S. Department of State. It can be used for purposes of identity, proof of U.S. citizenship, domestic air travel, and land and sea border crossings from Canada, Mexico, the Caribbean, and Bermuda.

U.S. passports are well known, however their cousin, the passport card is not. This makes the card a great document for counterfeiters, since most people have never seen one. This allows organized criminal groups an open door to schemes targeting financial institutions. The following are some of those schemes:

Direct Withdrawal And Wire Transfers

Early in the evolution, the fraudsters simply used the counterfeit passport cards and other identity documents to impersonate a known bank customer and withdraw cash directly from the victim’s account or conduct a wire transfer to a money-mule’s account. Low success rates and transaction limits reduced profits. Recently, however there has been an uptick in this scheme. Mules will enter a bank, present a passport card and request a copy of their bank account information. After reviewing the account, they will then attempt to withdraw from the same account.

JOINT SAVINGS ACCOUNT (AKA ACCOUNT TAKEOVER)

The same fraudsters began using money-mules to open joint savings accounts with the imposter. Mid-level facilitators began recruiting mules from social media and personal referrals. These recruiters collected approximately 10 percent of the proceeds. The mules only needed to have a legitimate bank account in their true name at the targeted financial institution. The mid-level facilitator would transport the mule and the imposter to the targeted bank and direct the two to open a joint savings account. The mule rarely knew the true name of the imposter and would be told they weren’t doing anything illegal since they were using their true name. The mule’s connection to the conspiracy was limited to the person who recruited them – they either knew them personally or knew them through social media. Once a mule is attached to a victim’s account, they could not be used again. Mules were well paid if successful and usually collected between $5,000 and $10,000, or 10 to 20 percent for the use of their true identity.

Once the joint account was established a co-conspirator would call the bank impersonating the customer and request to transfer funds to the newly opened joint account. A typical amount is between $20,000 and $35,000; however, losses have reached as high as $99,100 per victim.

As soon as the joint account was funded from the victim’s account, the mules would be directed to log into their accounts, transfer funds from the joint account to their previously established personal account. The mid-level facilitators/recruiter would

Authentic

✓ The photo is crisp, square, and blends into the card.

✓ The microprinting in the background artwork reads “UNITED STATES OF

✓ The optically variable device (OVD) on the lower right of the photo reads “Department of State” and “United States of America” (in a circular formation) with a rectangular shape on the right that reads “USA” vertically.

✓ On the front of the card, the date of birth, serial number, and some letters in “USA” on the right side of photo should feel raised; on the back of the card, the card number should feel raised.

✓ Under UV light, the front of the passport card shows a red eagle surrounded by blue stars and text that reads “FROM SEA TO SHINING SEA” then drive them to other bank branches and direct the mules to withdraw less than $10,000 cash from the teller windows. This repeats at as many local branches as needed until the funds were depleted or frozen by the bank.

✓ When dropped on a non nonmetallic surface, striking an edge, it will make a metallic sound.

WHERE DOES IT END?

These are just a couple of ways the fraudsters are creating havoc, but some of this can be prevented. If the tellers are aware of some of the security features on the passport cards,

Counterfeit

X The photo often has a white blurry border or a dark gray square surrounding the photo.

X Under magnification counterfeit biodata will have distinguishable cyan, magenta, yellow, and black (CMYK) dots instead of pure colors.

X If there is an optically variable device (OVD) it may contain incorrect language or images (e.g. “U.S. Supreme Court” laminate).

X The counterfeit may lack light reflecting, closely set, vertical lines that are placed behind the OVD.

X Under UV light there will be no images or text, or incorrect images and/or text.

X The date of birth, serial number, and other data fields on the card are printed rather than laser etched / raised.

X When dropped on a non non-metallic surface, striking an edge, it will not make a metallic sound.

it can be fairly easy to know if they are handling a real document or a counterfeit card. Here in Arkansas, there are no land borders with foreign countries. Most people do not have a passport card, especially in a state that is not near a border. This is not to say people do not have them, but more are in states bordering Mexico and Canada. The other people who utilize the cards are people who like to go on cruises. With this in mind, that eliminates the frequent use of the document in our region.

Another telltale in the feel of the document, there are raised areas, which resemble the numbers on a credit card, there are colorful holograms, tiny, tiny print, and NO layers. The cards are not laminated so there are no layers. Another tell tale is the sound of the card. When it is dropped on a counter, the card “clinks” with the sound of metal. If you drop a credit card on a counter it doesn’t clink, but the passport card, if genuine, will make the metallic clinking sound. The colors on the card are pure colors, not little dots of ink.