Bitcoin Not To Blame For National Guard Credit Card Fraud


Bitcoin Not to Blame for National Guard Credit Card Fraud

Five members of the US Army National Guard have been arrested. All of the suspects are involved in an illegal scheme involving stolen credit cards bought with Bitcoin.

Also read: The Q1 State of Bitcoin 2016 Is Positive

The news broke on May 23, 2016 when a message appeared on the US Department of Justice website regarding the incident. The official source mentions how four US Army National Guardsmen have been indicted in two different fraud schemes. These charges include using stolen credit card information for “card cloning,” with the intention of using the fraudulent cards to buy items from military base stores.

What makes this story even more concerning is how the military personnel used Bitcoin to obtain the credit card information. All of the data purchased through foreign websites, was used to create so-called “credit card dumps.” Such a credit or debit card dump can be used as a perfect clone of the original credit card. 

US Army National Guard Credit Card Fraud

Bitcoin.com_Credit Card Scam US Army National GuardThree US Army National Guard members were indicted on charges regarding their involvement in this scam. A fourth member was indicted in a different case for a similar fraud scheme. Using these credit card clones to purchase goods from Army and Air Force Exchange Service stores on military bases and elsewhere seems to have been the end goal for this scam.

The charges for such an offense are quite severe. Three of the US Army National Guard members face up to 20 years in prison. However, they also face a mandatory minimum of two years in prison for aggravated identity theft, which will be added on top of other potential sentences.

Bitcoin’s Not to Blame

Bitcoin.com_Credit Card Scam US Army National Guard Bitcoin

While Bitcoin is mentioned in this credit card scam by various US Army National Guard members, the cryptocurrency is not to blame for these illegal activities. Granted, the military personnel used Bitcoin to buy their hardware and software. That being said, they could have used any other payment method as well.

The fact they resorted to using Bitcoin goes to show their malicious intent. Unlike wire transfers or plastic cards, Bitcoin lets users preserve some privacy. Additionally, Bitcoin transfers do not link funds to a real-life identity or address. Due to the global acceptance of Bitcoin as a payment method, it is easy to purchase just about anything with it. That also means sellers can offer illegal goods, such as the materials needed to clone credit cards.

In the end, all of these suspects had the intention of committing fraud and purposefully bought stolen credit card information to purchase goods without paying for them. This is not the fault of Bitcoin, but the sole responsibility and decision by the National Guard members. They had a clear plan to commit fraud on a large scale, and handpicked their victims. Bitcoin can’t change that, unfortunately. 

There are a lot of misconceptions regarding Bitcoin as a payment method. Bitcoin users are responsible for how they use the cryptocurrency, and dealing in illegal goods is their own choice. Criminals often use cash for nefarious purposes as well, but no one blames the central bank for those incidents.

What are your thoughts on this story and the role Bitcoin played in the process? Let us know in the comments below!


Tags in this story
Clones, Credit Card, Fraud, Scam

Images courtesy of National Guard, Shutterstock.

Jean-Pierre Buntinx

Jean-Pierre Buntinx is a freelance Bitcoin writer and Bitcoin journalist for various digital currency news outlets around the world, Jean-Pierre also has a keen interest in Fintech and technology, and he is always open to new challenges.

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