How To Prevent Credit Card Fraud

Credit cards are a great convenience. However, they are also an easy target for fraud and theft. One of the latest scams is the use of a skimmer. It is a device that is mounted over an existing ATM machine or gasoline pump. It looks identical to the original and it can capture your credit card information. It can be used to replicate a credit card and sold on the internet.

- Apr. 2018

Recently, I received a text message from my bank. It is the one where my credit card was issued. It inquired about a recent purchase at a Subway sandwich shop. I replied with a denial. It then informed me that my card was compromised and they will stop all future transactions and instructed me to contact their office to follow up. I called the 800 number and they informed me of several other transactions that were suspicious. There were a total of 5 transactions all in small amounts at various vending machines and fast food joints, all within the last few days.

They informed me my acccount will be reimbursed with these amounts in about 30 days but meanwhile a new card will be shipped overnight to my address. It was a relief. I then asked the account rep. How did this happen? I have a chip embedded in the card. She informed me about a new scam called a skimmer. It is a device that is slipped over a card reader and designed to look identical to the original. It can be easily mounted within seconds. When you swipe your card, it records the data and can be used later to duplicate your card account information. It cannot duplicate the chip but it is sufficient to be used in some other machines that does not accommodate the chip system. In addition, they may also mount a small video camera nearby to capture your zip-code as you enter it on the keypad. Check out the short video in the link below to see how to avoid being scammed In this fashion.

The rep. also mentioned another possibility where a credit card can be compromised. When you shop online and supply your credit card information, some unscrupulous retail outfits can capture your account information entered and including the security code in the back of the card and the expiration date. They can then replicate a card and sell it online. One way to avoid this trap is to use a prepaid card for online shopping. It can save you some grief.

Credit card fraud is common. It cost consumers and banks billions of dollars each year. One of the main reason the interest rate on credit cards are so high compared to other rates is to account and make up for the losses due to fraud. Banks are getting better at catching these scams or at least minimize the damage. When a suspicious purchase is made, they are able to track and inform the account holder instantaneously. The long term answer is to convert all transactions to accept the chip system. This will prevent the thiefs of using the duplicated cards.