Credit card fraud costs businesses hundreds of
millions of dollars every year. The costs ulimately trickles down to
you. What happens is that businesses which are affected pass these
costs to you which translate in higher prices of goods and interest
rates.
One common method used in frauding people is called
skimming.
Credit card skimming involves using devices to copy data from
legitimate cards onto counterfeit ones which are then sold or used to
purchase items. Picture this: You've gone out to eat in a restaurant
and flip out your card to pay the bill. The fraudster will then run
your credit card twice, the first time to charge you for the meal and
the second time through a magnetic card reader. The fraudster then
copies the data to a blank credit card and sells it or uses it.
Though credit card theft seems to be on the
increase, it is actually one of the easier crime to prevent. Credit
card companies are working extra hard to fight this crime and some of
the tactics they employ include putting the face of the card owner on
the card to make it harder for thieves to make face-to-face purchases.
Another method they use is holograms, secret imprints, or hidden images
so fraudsters will have a harder time making a new credit card with
stolen card numbers.
Below are some tips on protecting your card:-
- Never write your PIN number on
your card. This will prevent fraudsters from using your card at ATMs
- When you get a new card always write the issuer's
telephone number in a notebook for future reference. This will come in
handy should the card get stolen or lost
- Immediately call your credit
card company should the card get lost or stolen. The credit card
company will then cancel the card number and make it useless. By law,
once you report that your card is lost or stolen, you have no further
liability for unauthorized charges. If charges happen before you call,
your maximum liability under federal law is $50 per card.
- Never give your credit card numbers to
telemarketers unless you are completely sure of the caller and that
it's a reputable company. Some fraudsters will call you and claim to
work for your credit card company/bank and inform you that they need to
verify your card number because of some “computer
glitch.” Do not fall for it This is a scam!
- When you recieve your monthly billing statement go
through it carefully to see if there were any
transactions that were done without your consent
Beware of Credit Card Protection Companies!
What happens is that consumers are usually
approached over the phone to purchase credit card protection. They are
"educated" that the Internet is an unsafe place where credit card
numbers can be obtained easily. They are told that this activity is
very prevalent and that they need credit card protection to protect
themselves.
In an actual incident that happened in North
Dakota, consumers received a sweepstakes notice in which they were told
they would receive a prize. The catch was that for
them to claim the prize, they would have to purchase a credit card
protection service.
Others received a solicitation with a check from a
credit card protection company. The company encouraged consumers to
cash the check, but most did not read the fine print
on the company’s solicitation which indicated that by cashing
the check, the consumer agreed to a one-year membership for which they
were charged.
The victims ended up paying US$ 57 to US$120 for
credit card protection services. Under the Fair Credit Billing Act,
consumers already are offered credit card protection. You may want to
contact the issuer of your credit card for information on what your
agreement provides for you.
BEWARE!
ADDITIONAL
RESOURCES
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CREDIT CARD FRAUD