Despite the advent of Chip and Pin systems, credit card fraud scams are on the increase all over the world. Chip and Pin may give consumers protection when they make a purchase in person but it can do little to prevent scams when the 'cardholder is not present.' Buying stuff over the phone or online can be risky with Internet credit card fraud a particular problem at present.
The databases that store these details online are rich pickings for card fraudsters- this month saw a team of hackers arrested for what is held to be the biggest identity theft to date. According to a BBC report the team managed to get hold of the details of 130 million credit and debt card in a massive merchant credit card fraud attack. So, what measures can help here?
Is Credit Card Fraud Preventable?
Given the way that consumers pay for goods and services nowadays there is no cast-iron credit card fraud protection that will give a 100% guarantee of safety. Consumers should, however, be aware of the issues here and should make it hard for fraudsters to strike. For example:
- Consumers paying for something on a card in person shouldn't let their card out of their sight. There is no reason for a waiter, for example, to take a card away to make a payment. They should bring a Chip and Pin machine or an alternative payment method to the customer.
- Don't give out a card number over the phone unless it is to a trusted source. Watch out for phone based credit card scams where a caller pretends to be from a bank or credit card company and asks for sensitive data such as card security numbers, PINs and passwords in full. If in doubt, call the bank/card company back to check if the call was legitimate.
- Don't buy anything online from a site that has no security during the payment processing system. Buy from trusted sites with established reputations and avoid sites that have no address or contact details listed.
- Don't carry PIN numbers in the same place as credit cards.
- Sign all credit cards as soon as they are received. Old cards should be cut into small pieces as soon as they are no longer used.
How to Spot a Credit Card Fraud Alert
Sometimes consumers will fall victim to a scam of this kind because of carelessness or inexperience. It is perhaps more likely, however, that many will have problems based on the actions of professional hackers. Merchant credit card fraud is big business. After all, hacking into a database that contains thousands of credit card details is worth a lot more than targeting individuals. This can lead to problems with identity theft as well as credit card usage.
There may be little that can be done on an individual level to avoid this happening but it is important to spot the signs that it has happened quickly. If a card is being used fraudulently then a card holder can spot signs and then take action. Typical signs include:
- Card statements stop being sent out- this is often due to fraudsters changing an address to try and carry on spending on a card for as long as possible.
- Strange purchases appear on accounts- many fraudsters will start with small purchases to see if they can get round the card company and the card holder. Check online and postal statements every month to make sure that all purchases are correct.
- Calls from card companies- don't ignore calls from card companies on the basis that they must just be trying to sell something. They may well have found a suspicious transaction and, as part of their credit card fraud protection processes, may be trying to check it out.
Credit card fraud detection should be reported to the card company immediately. They will then be able to give advice on the steps to take to prevent any further damage. If the fraud involves identity theft then this may also mean involving the Police and credit reference agencies to minimise damage as quickly as possible.
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