Protecting Yourself from Credit Card Fraud

Credit cards have transformed the landscape of financial management. However, the convenience they offer comes with inherent risks, including credit card fraud.

As technology progresses, cybercriminals adapt their tactics to steal sensitive financial data. According to Bankrate, in 2021, the FTC handled nearly 390,000 reports of credit card fraud, with US losses expected to reach $165.1 billion in the next decade.1

For financial security and peace of mind, it is imperative to safeguard yourself from credit card fraud. In this article, we will delve into various forms of credit card fraud and provide actionable tips to help you fortify your financial defenses.

What is Credit Card Fraud?

Credit card fraud encompasses a wide range of illicit activities aimed at unauthorized access to your credit card information.2 This includes but is not limited to unauthorized transactions, identity theft, account takeovers, card-not-present fraud, and other schemes. Cybercriminals use tactics like phishing, skimming, data breaches, and malware attacks on your computer or phone to access your sensitive information.

Credit Card Fraud vs. Identity Theft

Though closely related, credit card fraud and identity theft target distinct facets of your financial life. Credit card fraud entails the unauthorized utilization of your credit card for purchases or withdrawals. Conversely, identity theft is a broader crime wherein a perpetrator assumes your identity to open new accounts, apply for loans, or engage in other fraudulent activities under your name. Both crimes can yield devastating consequences, including financial loss and tarnished credit.

Shielding Yourself Against Credit Card Fraud

Here are several crucial measures you can employ to protect yourself from credit card fraud.

Consistently Monitor Your Accounts

It’s important to regularly review your credit card statements and online banking activities. Don’t just give your accounts a quick overview; set aside time to scrutinize every transaction, and if you find any suspicious or unauthorized transactions, immediately report them to your card issuer.

Activate Account Alerts

Most financial institutions offer text, email, or app push notifications of account activity. Learn what alert options your banking institution offers and set up alerts for large transactions, account logins, and balance changes to stay abreast of activity on your accounts.

Safeguard Personal Information

Never disclose sensitive personal information, such as your social security number, account PINs, or passwords through email, phone calls, or text messages. Legitimate organizations never ask for this information via these channels. Additionally, be cautious about sharing even “innocent” personal information, such as your mother’s maiden name, the make and model of your first car, or a beloved pet’s name, since these answers are often used in identity verification questions and a fraudster could pretend to be you.

Use Robust Passwords

Create complex passwords for your online accounts, incorporating a blend of uppercase and lowercase letters, digits, and symbols. Don’t use easily guessable information, such as birthdays or names. Do not use the same password for multiple accounts.

Embrace Two-Factor Authentication (2FA)

Enable two-factor authentication (2FA) for your online accounts. This introduces an additional layer of security by requiring a secondary form of login verification, such as a text message or separate login, in conjunction with your password. It may seem like a hassle, but it can help protect your critical data.

Be Alert for Phishing Attempts

Cybercriminals often use phishing emails to deceive you into revealing sensitive information or installing malware on your computer or phone. Never click a link or download an attachment from an unfamiliar source. Always double-check the sender’s email address for authenticity, because cybercriminals can make their emails look like they came from a legitimate organization. However, the sender’s email address will give away the ruse.

Protect Your Devices

Ensure your devices are up to date with the latest security patches and use reputable antivirus and anti-malware software on both your computer and mobile devices. Be cautious when connecting to public Wi-Fi networks, since these may be susceptible to breaches.

Check for Secure Websites

Before entering credit card details online, always confirm that the website’s URL starts with https:// and displays a padlock symbol. This signifies a secure and encrypted connection.

Use Virtual Credit Cards

Some credit card issuers or web browsers offer virtual credit cards with temporary numbers for online transactions. Use this option when possible, since the temporary card numbers will hide your actual credit card number.

Routinely Check Your Credit Reports

At least annually, obtain and review your credit reports from all major credit bureaus and closely evaluate them to spot any suspicious or unauthorized activities that may indicate identity theft.

Although these steps might seem like extra work, a little additional caution goes a long way to prevent future regret. By learning and understanding the tactics employed by cybercriminals and following these tips, you can substantially reduce your risk of becoming a victim of credit card fraud.

1. https://www.bankrate.com/finance/credit-cards/credit-card-fraud-statistics/
2.  https://www.law.cornell.edu/wex/credit_card_fraud

This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.