Table Of Content
- While credit cards are a very convenient tool – fraudulent activity such as identity theft and fraud are continually on the rise.
- Most of the time, you could avoid it by taking extra steps to minimize risks and making sure to follow security tips.
- Scammed? Keep calm, and don’t panic. Think logically – remember that you have someone to turn to for help
In recent years, it has become more commonplace to make purchases online or use contactless payments. Unfortunately, this can increase the vulnerability to credit card fraud. In this chart, using Nilson Report data, we can see that worldwide credit card fraud has increased from $13.7 billion to $28.65 billion .
Best Ways To Avoid Credit Card Fraud
If you want to know how to protect yourself from falling victim to these credit card criminals in 2023, try these expert-approved strategies.
1. Don't Share Personal Information
Over the years, there has been a proliferation of email scams that go around in bulk asking people to verify personal information. Usually, the email will appear to look like the real thing that you receive from your bank, card company or merchant. Sometimes, it may direct you to a bogus website that looks similar to the authentic website.
Always be wary of any email that claims to be from your financial institution.
This is ‘phishing’ and you should report it to your internet service provider at once. Never respond to such emails. It’s better to call the card company directly (their number is on the statement or on the back of your credit card) if you have questions or inquiries.
Lastly, don’t share any financial information in an email or by phone. If you have doubts about the genuineness of a website, email or phone call that requests information from you, disconnect and try to secure independent confirmation.
Your credit card company or financial institution will always be available for these matters. It could mean an extra precaution for you but it’s better to be safe than lose all your money to fraud.
Financial institutions always think of your security, privacy, and confidentiality so they will never ask you to give out your passwords, PINs, account numbers, or other sensitive information through mail or over the phone.
2. Protect Your Physical Card
One basic safeguard you can adopt to avoid credit card fraud is to keep your physical credit cards safe from thieves. Keep your cards in a purse or wallet close to your body to make it difficult for anyone to snatch away.
If you know you’re going to a high traffic area, use a smaller purse because it’s going to be harder for thieves to break into or steal the contents. Carry only one or two credit and debit cards you are planning to use for the day. For all your other cards, leave them in a safe place at home.
Thieves may take a picture of your credit card with a camera or cell phone so don’t expose your credit card in the open any longer than necessary.
After completing your transaction, stow your credit card away immediately. Check that you have your credit card back in your possession before leaving the merchant’s place of business.
3. Set Complicated Passwords
Use strong passwords or passwords that are very difficult to guess. You can do this by including a combination of upper-case and lower-case letters, numbers and even other characters (such as “%” or “&”).
Avoid using obvious combinations like “123456”, “abcde”, your name and birthday or that of your family members. Don’t write them down on the credit card or anywhere and never share them with anybody.
Change your passwords regularly. A good practice is to revise your passwords monthly, or if you can, weekly. It’s a superb security move to keep thieves from compromising your account.
4. Take Advantage Of Automated Alerts
The good thing that happened because of all the fraudulent activities and identity theft going around is that there are even more ways to protect yourself from them. Many companies make free alerts available with your credit card package. You can sign up for this protection wherein the bank or credit card company emails, calls, or texts you if they detect suspicious activity or charges regarding your account.
Another step is to choose a card that includes fraud protection. Many major card companies offer $0 liability guarantee that assures you they won’t hold you responsible and liable for paying anything when there’s an erroneous or fraudulent charge to your account.
You can also look for a card from a company that issues paperless statements and automatic alerts, plus a department of fraud specialists who can provide assistance if ever you need it.
5. Report Lost or Stolen Cards Immediately
The sooner you report a missing credit card, the sooner your credit card company can do steps to protect you by issuing an alert, placing a hold or canceling your card to prevent unauthorized charges.
Letting the card issuer know as early as possible if you’ve lost your card inadvertently or through theft will lower the possibility of you having to pay for any fraudulent charges on your card. Note down the hotline of your credit card company or save it on your phone so you’ll have a quick reference in case you actually need to make the call.
6. Buying Online Responsibly
Before you buy anything online from not-so-popular websites, ensure that the company has a physical street address and verify with the Better Business Bureau if there are no negative reports about them.
Phone numbers are no longer useful for this because the present technology allows an office to be in Mumbai, India but carry a New York phone number. Pay attention to poorly written sales copies with blatant grammatical errors because they can be signs of careless and possibly phony companies.
Also, note that a merchant website would normally have a Security Certificate and a Secure Socket Layer (SSL) that encrypt sensitive data that pass between your web browser and their web server. A simple way to check if you’re opening an authentic and secure site is to inspect if there’s a padlock icon in their address bar.
7. Review Your Statements Regularly
A credit card fraud will often manifest through unauthorized charges on your credit card billing statement. If you see an unfamiliar charge – no matter how negligible it appears – report it to your credit card company instantly. Your credit card issuer will advise you if you should close your account and get a new credit card number to stop the fraud.
The Fair Credit Reporting Act (FCRA) gives you the privilege of receiving one free credit report from each of the credit reporting agencies each year. You can either get all the three reports at once or time your requests, so you receive a report every four months.
8. Use EMV Chip Cards
EMV is the current global standard for chip-based debit and credit card transactions specifically because it fights against fraudulent charges or the unauthorized use of lost or stolen cards.
It has more security against fraud, guarantees authenticity, provides greater security for online payments, affords better information storage, and gives easy acceptance abilities. EMV cards make use of advanced features like data authentication, cryptographic technology, and chips that are difficult to clone.
Many experts noticed that the United States has a higher amount of fraud than the rest of the world because it has been sluggish in shifting to EMV. Countries that have been embracing the EMV technology in their cards had a decrease in card-counterfeiting incidents.
9. Do Not Publish Personally Information On Social Media
Social media has brought us in easy contact with family, workmates and even with long-lost friends but it also made a lot of people a sitting duck for card thieves.
Do not put your birthday online (or just use a fake birthdate) and seriously think if you want your family relationships out in full view in cyberspace. Keep your profile safe so that anyone you don’t know or trust can’t use it for criminal intentions.
Once in a while, do a Google search on yourself to check if your phone number, address, and any other identifying information appear online that thieves may use for their scams.
10. Know The Risk Of Public Wi-Fi
Getting free Wi-Fi and public Wi-Fi is like finding a treasure – it’s convenience without cost. The downside is, it’s very risky because fraud operators can easily bypass the low firewall security and steal the users’ information.
So, when working outside of your home or office’s secured Wi-Fi connection, use a virtual private network (VPN) to send encrypted data.
Even when you’re working at home or in the office, make sure that you’re using a secured website when sending financial information such as your credit card number and security code. A secured website will begin with “https” in its URL at the browser’s address bar.
Successful credit card fraud will cost you and will cost the economy. With these ten ways to avoid credit card fraud, you can enjoy greater peace of mind as a consumer.
How Does Credit Card Fraud Work?
For crooks, credit card fraud is a little easier than other crimes and they can accomplish it in many forms, digital and physical alike. There are many ways a thief can commit credit card fraud:
- Hacking your computer. They steal your vital information directly from the router of your computer
- Credit card skimming. The fraud operator uses a skimmer (a special electronic device) or photocopy of your receipts to take your information.
- Credit card phishing. The fraudster sends a massive amount of fake emails to consumers and the unsuspecting ones who reply/comply with the fake emails unknowingly releases details of their account to the crook.
- Fake Wi-Fi networks. The scammer sets up a fake Wi-Fi network and when an innocent user logs in, the thief steals their account information.
- Stealing your identity. The defrauder assumes the identity of another person to commit credit card fraud.
- Online gaming fraud. A con artist gets hold of a gamer’s user ID and password then uses those account details to make in-app purchases.
- Hack retailer’s database. Hackers get into the database of retailers and other business and copy the customers’ information.
- Misleading advertisements. Con players place ads that instruct visitors to enter their personal information online on fake websites.
- Fake calls. Tricksters call credit card customers and pretend that they are from the card company to ask information from cardholders to ‘update’ their records.
Common Sense Is The Ultimate Way To Avoid Scams
If you’re an online shopaholic (as many Americans are), make sure you protect your computer. Install highly-rated anti-virus software on your computer that automatically updates itself and always use a secure wireless network when you make your purchases.
If possible, never let anybody (family members, girlfriend, etc.) use your credit card unless you can wholly trust them and they know how to keep your credit card safe.
Before you input your credit card details, make sure that the website begins with “https:”. Use passwords that are a combination of at least 10 letters, numbers & other characters – the longer the password, the harder it is to crack even with automated hacking scripts.
What To Do If You’re A Victim Of Credit Card Fraud?
Some people may never experience credit card fraud, but fraudsters are constantly operating. You may one day find yourself wondering how and where somebody stole your card information.
It could be that lone gas station in the middle of the highway. Or perhaps that new online store where you bought your new pair of running shoes. The reality is, it’s difficult to tell once you discover the crime.
Keep calm and don’t panic. Take a deep breath, collect yourself and start thinking logically for your next moves. Here are some important tips on what to do next.
Tips To Follow If You’re A Victim Of Credit Card Fraud
Here are the steps to take if you fall victim to credit card fraud:
- Get in touch with the credit card company. Most of these card issuers apply a zero-liability policy which means you won’t be responsible for any fraudulent charges on your account. Aside from this, federal law limits your liability for fraudulent credit card charges.
- Check your credit card account and change your passwords immediately. After notifying your credit card company, check all of your other credit card accounts to see if the thieves also compromised any of them. Change your online passwords and PINs to block the fraudsters from doing any further damage.
- Freeze all the affected accounts. Call each of your credit card providers shut down each affected card to avoid further charges.
- Ask for a copy of your credit report and place a credit fraud alert. Often, early signs of fraud will first appear on your credit card statements and later, on your credit reports. Some of these are new accounts you did not apply for or maybe a missed payment from a card you have not been using. Don’t forget to request the credit bureaus to add a credit card fraud alert to your credit file.
- If needed, file a police report. A police report is important if you see a pattern of fraudulent charges happening days after the first signs of suspicious activity. Informing the local authorities of an incident of credit card fraud can help them catch the culprit and prevent more similar incidents. You should also get a copy of the report because you might need it when you file notices with credit agencies and credit card providers.
If fraud occurs, remember that you have someone to turn to for help. You can turn to many sources for help – your bank, credit card company, credit bureaus, and law enforcement authorities. They will all be willing to stop credit card fraud.
Is it Safe to Pay by Credit Card Online?
This is one of the significant impacts of the Pandemic – buying online seems inevitable today. Most websites take their site security very seriously, so paying with your credit card is safe. However, you will still need to provide your credit card information. The only way to avoid this is to use a third-party payment processor such as PayPal, which is not an option for all sites.
The best way to stay safe when you use your credit card online is to watch your statements and ensure the payment was taken correctly and that there are no charges you don’t recognize.
There is no doubt that credit cards are very convenient when making both online and in-store purchases but we cannot discount the fact that instances of identity theft and fraud are continually on the rise. Have a strategy in place to notice identity theft as soon as it happens.
That means putting up alerts on your open accounts and checking your credit report regularly, plus other means of security. Although you can get enough protection without paying anything, you can also spend a few dollars to set up additional monitoring and resolution services.
Whatever it is, you should have some form of protection. At the very least, take advantage of the free services and sign up for them.
With the development of contactless technology, many people have concerns about scammers accessing their credit cards without it even leaving their wallets. The RFID chips on new credit cards transmit data via radio frequencies, so if you want to keep your cards safe, you need to minimize the possibility of transmission.
Fortunately, there are several ways to accomplish this. Firstly, place all your RFID cards next to each other inside your wallet. This will make it more difficult for potential thieves to read one particular card. It is also a good idea to carry your wallet in a front pocket. If your wallet is in a back pocket, it is more vulnerable to thieves with a scanning device.
It is also possible to shield your credit cards with a specially designed sleeve or wallet. These items block scanners from reading your cards while they are in your wallet. There are DIY options, such as using aluminum foil to line your wallet, but a sleeve is likely to be far more effective.
Finally, be sure to check your credit card statements carefully, so if there has been any fraud, you can report it immediately to your credit card provider.
Manufacturers of RFID blocking wallets claim that these items are very successful at blocking scanners while the card is inside. Since RFID technology relies on radio frequencies, if the wallet can block these frequencies, it will prevent any potential thief from accessing your card data.
Thieves seem to take pride in keeping up with the latest technology. These days, it is less common for a potential thief to simply steal your wallet, which could lead to a confrontation. It is more common for thieves to commit credit card fraud by stealing your credit card details.
Unfortunately, there are scanning devices that can access the details from your RFID credit cards while they are still in your wallet. This is a discreet way to steal from you, so you should take care to ensure that your cards remain safe.
Credit card theft is becoming increasingly common, but there are some measures to ensure that you minimize the risk of being a victim.
The first thing is to make sure you keep your cards safe. Your cards should keep your cards secure in your wallet or purse. When you make a purchase, return your card immediately. If you notice your card is lost or stolen, report it immediately. This will put your provider on alert for any new charges and they can block the card for new purchases.
If you’re using your credit card online, ensure you check the URL is authentic and the site has adequate security. It is also a good idea not to allow any websites to remember your card details.
Finally, go through your monthly statement carefully, checking the transactions, so you can spot any suspicious activity and report it immediately.