Quebec debit card ring defrauds 22,000

Police in Quebec arrested 45 people and seized more than 12,000 counterfeit bank cards in raids on a global fraud ring Wednesday.

Montreal-based ring linked to Vancouver, U.K., Australia, New Zealand, Malaysia, Tunisia

Police in Quebec have arrested 45 people and seized more than 12,000 counterfeit bank cards in raids on an international fraud ring that cloned cards and pilfered cash from victims' accounts.

"We believe that we’ve put an end to a significant operation that was in operation here in the province," said Supt. Guy Pilon of the RCMP. 

"Internationally, it is a reality that is obviously evident in all countries today. The advent of the technology creates opportunity for the public, but also for criminal organizations that want to defraud individuals."

The network was based in Montreal, but worked with accomplices in Vancouver, Australia, New Zealand, Malaysia, Tunisia and the United Kingdom.

The RCMP say 61 arrest warrants have been issued on charges including gangsterism, manufacturing of forged cards, fraud and identity theft.

Tips to avoid fraud

  • Use a debit machine that has a chip reader.
  • Guard the PIN you use with your debit card.
  • Pay with cash.

In one such attack, the fraudsters used 79 cards at 23 banks and drained $30,000 out of victims' accounts — all within five minutes.

Pilon said police in Quebec are working with international authorities to help identify accomplices outside of Canada.

A steady stream of vehicles carrying suspects flowed into Montreal police's northern operational headquarters Wednesday morning. More than 30 arrests had been made by 9 a.m. ET.

It marks the first time Canadian authorities have laid gangsterism charges in connection with a fraud case.

In total, police identified 22,000 victims who were defrauded of $7.7 million. However, the fraud had the potential loss of $100 million, investigators explained.

The fraud worked like this:

  • Point-of-sale PIN pads were stolen or taken with consent of employees from commercial businesses and replaced with a dummy PIN pad.
  • The PIN pads would be taken to a hotel where they were outfitted with a card reader and Bluetooth transmitter before they were swapped back in at the business.
  • The suspects would leave them in place for several weeks or a month as data was captured from customers.
  • That data was transferred remotely to a computer via the Bluetooth.
  • That information was then recorded on a blank card and the PIN  written on top.
  • In a co-ordinated attack, a group of "runners" would use those cards and hit bank machines all at the same time, draining as many accounts as possible before the banks caught on.

Locations in the greater Montreal area and Ontario were targeted, with about 250 officers involved in the operation. 

The RCMP said the wave of arrests follows a major debit card fraud takedown in November 2010.