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WHAT'S IN YOUR WALLET?

after the merger—he was earning a thousand dollars a day now selling dumps to carders around the world, in addition to the five to ten thousand a month he was still pulling in through his partnership with Chris.

Publicly, at FTC meetings and elsewhere, the credit card industry was doing its best to conceal the impact of the rampant magstripe theft happening worldwide. Credit leader Visa held up an industry-funded report by Javelin Strategy and Research that claimed consumers, not companies, were the source of the vast majority of identity theft and credit card fraud cases: Some 63 percent of cases originated with consumers, primarily victims of lost or stolen wallets, followed by theft by trusted associates, stolen mail, and Dumpster diving.

The report was grossly misleading, only tallying cases in which the victim knew how his information had been stolen. Visa's private numbers told the real story. Stolen wallets hadn't been the primary source of fraud since mid-2001, when credit card theft from e-commerce sites sent fraudulent “card not present” transactions—online and telephone purchases—rocketing up the chart, while every other category held steady.

In 2004, when stolen magstripe data became a massive underground commodity, losses to counterfeit cards followed the same stratospheric climb. In the first quarter of 2006, Chris Aragon-style counterfeiting edged out card-not-present fraud for the first time, topping $125 million in quarterly losses to Visa's member banks alone.

Nearly all those losses began with a price list like Max's. As Digits, Max accumulated page after page of positive reviews on Carders Market and a reputation for square dealing. It was a point of pride with Max—and a sign of the moral compartmentalization he'd practiced since childhood. Max would happily hack a carder and copy his entire hard drive, but if a customer paid him for information, Max wouldn't even consider shortchanging him.

His generosity, too, was well known. If Max had dumps that were about to expire, he'd give them away for free rather than let them go to waste. Together, his exemplary business practices and the quality of his