Mount Pearl jewelry store scammed out of nearly $100K in credit card cloning scheme

A man wearing a white sweater stands in a jewelry store.  The counter and back walls have a marble design.
Rohit Verma owns the NL Gold Factory in Mount Pearl, which was scammed out of close to $100,000 at the end of last year. (Submitted by Rohit Verma)

A Mount Pearl business owner is warning businesses to become vigilantes after he was scammed out of almost $100,000 at the end of last year.

Rohit Verma, who owns NL Gold Factory in Mount Pearl, was contacted by someone in Montreal who was interested in his jewelry after seeing it on social media in November. The two spokes over telephone and text messages, with Verma saying there were no immediate red flags.

“He gave me his credit card number over the phone. We just punched in his credit card, payment is good, we shipped everything,” Verma said Tuesday.

Things quickly escalated from there, Verma said, saying the person spent almost $100,000 over the next week. Purchases included a $38,500 watch and a watch and chain totaling over $19,000, among other purchases.

Verma ran the purchases through his payment processing company himself. The company said everything seemed legitimate, until he got a call from the bank.

“Like seven or eight days later, the bank [told] me that this card had been cloned,” he said. “It’s a big loss for us.”

Verma said the bank was alerted to the scam when the original card holder got in touch and the address the scammer provided him didn’t match the one on the bank’s file.

A diamond watch sits on a person's hand, and an invoice showed the watch cost $38.525 dollars.
The scammer made four purchases with the cloned credit card, including this $38,000 watch. (Submitted by Rohit Verma)

Verma then brought the scam to the Royal Newfoundland Constabulary — while the scammer remained in touch with him.

“He was willing to buy another watch and chain, which was worth close to $60,000,” he said. “Luckily we got the call that day, and I told the police officer everything.”

Verma said he wanted to share his business’s story as a warning to others.

“These kinds of people, they won’t stop. They will try to do these kinds of things with … many other people.”

RNC Const. James Cadigan said the investigation remains active but no charges have been laid.

The kinds of police scams investigated have evolved in recent years, he said, ranging from complicated phone and credit card scams to the emergence of artificial intelligence as a tool to trick people into handling personal details.

A police officer stands in uniform.
const. James Cadigan, the Royal Newfoundland Constabulary’s media relations officer, says the type of scams police investigate have become more sophisticated. (Ted Dillon/CBC)

“These scammers and fraudsters are evolving, and trying to find new, easier ways for them to obtain goods and money as quickly as they can,” Cadigan said Wednesday.

“When you look at the use of some stolen information such as a credit card, that could be, you know, an isolated case …but it could also of course be linked to these larger-scale operations where the goal is to obtain personal information and banking information.”

Cadigan says it’s best for businesses to have protections in place for phone calls and customer relations, like slowing down the process to make sure everything is correct and legitimate or building purchaser profiles to provide an opportunity for businesses to be comfortable with transactions.

Individuals should also keep their guard up on the phone, he said, especially if someone is looking to obtain cash or goods by pressing someone.

Read more from CBC Newfoundland and Labrador

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