Tips to Avoid Credit Card Fraud

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Credit card fraud costs cardholders and credit card issuers hundreds of millions of dollars each year. Some of the most common tricks used to gain access to your personal information are listed below. By being aware and following some simple advice, you can protect yourself from thieves.

Be careful with your trash

Discarded receipts and credit card statements are like gold to an identity thief. Digging through your trash is just one way for crooks to illegally gain access to your account numbers and personal information.

SOLUTION: Shred all documents, monthly statements, carbons, receipts, etc. before depositing them into your trash can. Play it safe by using a shredder for all of the above regardless of whether they contain compromising information. And don’t forget to shred all credit card applications you receive.

Watch out for dishonest clerks

Another way a thief can access personal information is through a dishonest clerk who makes an extra imprint of your credit or charge card. A cash register attendant or waitress could easily copy your credit card information without your knowledge. They may even scan your card electronically. They can then pass it on to another person or use the information themselves.

SOLUTION: Never allow a clerk to take your credit card out of sight. Many restaurants now offer at-the-table scanning that safeguards your number. If it is not available, hand carry the card to the register yourself and wait until the transaction has been completed before returning to your table.

Appeals, rewards and innocent responses

A phone call announcing you’ve won a grand prize or a free, all expenses paid trip, is often the bait used by thieves to snag the most gullible and sometimes the most savvy people among us. The catch is that you must verify your personal information to receive your prize. While you wait for delivery, the crook is out spending your money and racking up debt in your name. Legitimate companies don’t call to ask for a credit card over the phone.

SOLUTION: Stay alert and be suspicious of offers that seem too good to be true. Never give out any information unless you have initiated the call and are 100% sure that the information is required. A genuine winner will never be required to compromise personal information to receive their prize.

Credit card fraud on the Internet

Although credit card fraud is much more common when placing an order by phone, the Internet is a breeding ground for gaining personal data. Never respond to emails that request your credit card information via email or ask you visit a particular website to verify personal or credit card information. These are called ‘phishing’ scams; legitimate organizations do not redirect you nor do they ask for sensitive information without you first having initiated a relationship.

SOLUTION: Never provide your credit card information on a website that is not a secure site. When a company that you do business with contacts you via email, don’t respond. Type in the URL to their site and do your business direct.

Other tips to safeguard your credit and identity

  • Sign your cards as soon as they arrive and always keep them in a secure place, whether in your home, car or purse.
  • Carry your cards separately from your wallet, in a zippered compartment, a business card holder, or another small pouch.
  • Memorize your PIN number and never store it with your credit card.
  • Shield your credit card number so that others around you can’t copy it or capture it on a cell phone or other camera.
  • Keep a record of your account numbers, their expiration dates, and the phone number and address of each company in a secure place.
  • Never write you account number on a check or envelope.
  • Save receipts to compare with billing statements.
  • Never sign a blank receipt
  • Open bills promptly and reconcile accounts monthly, just as you would your checking account.
  • Report any questionable charges promptly in writing to the card issuer.
  • If you move, notify your credit card issuers in advance.

In the event of fraud or theft

If you suspect credit card fraud or your credit cards are lost or stolen, contact the issuer(s) immediately. Most credit card companies have toll-free numbers and 24-hour service to deal with these emergencies. You may also be asked to sign a statement under oath that you did not make the purchase(s) in question.

By law, once you’ve reported the loss or theft of your credit card, you have no more responsibility for any unauthorized charges that occur. Your maximum liability under federal law is $50 per credit card and many credit card companies will waive this fee for customers with good-standing accounts.

The FTC works for the consumer to prevent fraudulent, deceptive and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint or to get free information on consumer issues, visit www.ftc.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.