How to Prevent Credit Card Fraud
In many cases, the victim does not even realize that their credit card number has been stolen until they notice suspicious activity on their account or receive a bill with fraudulent charges. While some criminals may simply change their mailing address on their card, others may apply for a new one in the consumer’s name and report the card lost or stolen. The thief may steal personal documents or even register a change of address to make the fraudsters seem less suspicious.
To prevent credit card fraud, consumers should contact their credit card issuer as soon as they discover suspicious activity. The credit card issuer will likely contact the cardholder to confirm the fraudulent charge. If the charge seems familiar, call the credit card issuer immediately. The fraud victim should report the charge within 60 days of discovering it. If the charge is not more than $50, the card issuer will suspend the account and contact the cardholder directly. The cardholder should also change any passwords for the account.
If you suspect identity theft, keep close records. File a police report and make multiple copies. These reports will help creditors and other financial institutions confirm the transactions. You should also notify your card issuer and the three major credit bureaus. The FTC maintains a database of identity theft cases and law enforcement agencies use it for investigations. The FTC’s Identity Theft Helpline offers advice and resources to help consumers prevent credit card fraud.
In many cases, credit cards are stolen. A thief may not have access to the card to use it on a POS device, but they can still use the card details to commit fraud online. Because these criminals do not need a physical card to commit fraud, they can obtain basic account information and commit fraudulent activity by mail, phone, or online. They may even use a forged card to make purchases. This is the most common type of credit card fraud.
Credit card fraud can cost you time and aggravation. It can also lower your credit score, which accounts for 35% of your FICO® score. Besides being annoying, fraudulent credit card accounts can also negatively impact your credit utilization, which is the percentage of your available borrowing limit represented by your outstanding balances. In the long run, credit card fraud will hurt your credit score, which makes it difficult to make any purchases. If you think this may be the case, contact your credit card issuer to make a complaint.
If you have more than one credit card, consider carrying only those cards that you need. Leave the others in a secure place. You should never provide your credit card number over the phone, and you should never use public Wi-Fi to make purchases. To protect yourself from these scammers, you should make use of a smartphone-based payment app and avoid storing sensitive information. Also, do not give out your PIN or password over the phone.