Battle on Internet credit card fraud still long

Sandy Darmosumarto, The Jakarta Post, Jakarta

The lack of a coherent law that deals with credit card fraud cases over the Internet is the main reason behind the proliferation of scemmers (a device used to duplicate credit cards). A legal framework needs to be immediately completed before credit card companies, advocate groups, and legal authorities can gain substantial ground in battling the problem.

There are two legal frameworks currently being discussed. The draft law on information and electronic transactions is now in the hands of the government, but has not yet been passed on to the House of Representatives. Another framework is the cybercrime act on information technology initiated by the House of Representatives itself.

Thus, there are two avenues in tackling the Internet fraud issue. The first is to create a legal framework which regulates the use of information and transactions over the Internet. The second is to create a legal framework which provides preventive measures and punishes those who misuse information technology, as a medium to commit crimes.

Country coordinator of the Global Internet Policy Initiative (GIPI) Mas Wirgrantoro Roes Setiyadi, told The Jakarta Post that the amendment of the cybercrime act reduced the number of articles.

"Hence, the amendments have increased the strength and coverage of the bill," he said. Mas Wirgrantoro is currently vice-chairman of the Indonesian Telecommunications Society and helped to draft the cybercrime act with the House.

According to a report, the volume of credit card fraud in Indonesia reaches between Rp 35 billion to Rp 50 billion (about US$5.92 million) a year.

The chairman of the Indonesian Credit Card Association (AKKI), Budi Setiawan, told the Post that his association, through its Indonesian Risk Control Unit (IRCU) is actively working with the police, as well as holding workshops in an attempt to educate the general public (including merchants) on how to avoid being carded.

Due to the absence of a coherent law, "the police are now using what they call a `red book', a manual to conduct credit card investigations, in handling cases of credit card fraud over the Internet," said Budi. "The manual has been in use since 1997."

Coordinator of the Jakarta based Information and Communications Technology (ICT), Donny B.U., told the Post that "the majority of carding (the term used to describe credit card fraud over the Internet) activities are conducted in public Internet kiosks." He added that "most kiosks do not check renters' identifications and the majority of kiosk administrators know their kiosks are being used for carding.

"According to the Indonesian Association of Internet Kiosks (AWARI) almost 50 percent of revenue in Internet kiosks is derived from carding," said Donny.

Hence, if Internet kiosks obliged potential customers to produce identification, kiosks would lose business and they would not be able to pay their high overhead costs.

"The most effective way to curb scemmers is to start from Internet kiosks, however this may prove to be impossible as the operators will not cooperate," he commented.