15 ways to avoid credit card fraud these victims wish they knew beforehand
A look at how to prevent credit card fraud and advice from victims.
Within the first quarter of 2020, reports of increased fraud and identity theft, up 20.1% from the previous quarter with credit card fraud leading the charge. The Consumer Federal Protection Bureau (CFPB) allows consumers to submit complaints on financial products, including credit card fraud.
As a practical bunch here at finder.com, we analyzed the complaints and found 15 takeaways to avoid credit card identity theft. For the sake of maintaining anonymity, we use “XXXX” in place of identifying information.
1. Keep your credit cards out of reach from children
When you leave your child home alone for a few hours, you might mention in passing to not burn the house down. But what happens when said child uses your credit cards in your absence? Someone was definitely grounded in that household.
Your kids likely don’t understand all of the intricacies of credit and could leave you with a hefty bill.
What Happened: “My minor child used my credit card for over [$12,000.00] of unauthorized charges within gaming apps through XXXX. When I initially reported the unauthorized charges, I didn’t even know it was my child that had done it ; XXXX said we were not responsible for the charges. They refunded some of the charges and then declined to remove any more stating that we are responsible for misconduct of the child.”
2. Don’t give out your information over the phone
If it’s too good to be true, then it likely is. This person learned a valuable lesson about giving information over the phone. Don’t do it. This one merits a palm to the face.
What Happened: “On XX/XX/2020 I attempted to resolve an issue I had with XXXX about some merchandise I had not received. I searched for a number to contact at XXXX on XXXX to file a claim and I reached who I first believed was from XXXX. I quickly realized that person that I had been dealing with over the phone (who claimed to be from XXXX ) did not seem credible because of the information that he was attempting to get from me asking for my banking information but I became suspicious I refused to provide him any information except for my XXXX account information and I immediately ended the call. (I later confirmed the person claiming to be from XXXX was not from XXXX )…” “I clicked on the XXXX page and went to the XXXX Activity page and there was a pending transaction listed for [$990.00] that I knew nothing about, a transaction that my wife and I had NOT initiated or approved.”
3. Don’t click on credit related pop-ups — or any pop-ups for that matter
Internet pop-ups are deviously designed to download viruses and other malware onto your computer. If you value your privacy, turn on “Pop Up Blocker” in your browser.
What Happened: “I was ordering airplane tickets when this pop-up stated if I applied for a credit card I would get [$100.00] off on my tickets. I had already picked out my dates, entered the names birthdates, seating and bag information. I was at the payment phase when the popup displayed. So I took advantage of the offer but when I completed the credit form it didn’t take me back to check my order when I was approved. It just checked me out and charged the card. I never got a card number or a phone number to call. When I saw my confirmation it changed the flight day to the day I bought the tickets. Allegiant terms of services said 24-hour notification or no refund. I could not call or reach anyone and we started getting notifications that the plane was ready to leave. I tried to cancel the return ticket and it never fully canceled and notified us to board the plane for a return. I still do not know the card number or who to call. XXXX doesn’t have a phone number on their website. I sent an email with no reply. I think I now have a debt of [$700.00] for something I never ordered. I picked XX/XX/XXXX and it changed it at checkout to XX/XX/XXXX of the same day. I feel I was frauded because of their 24-hour cancellation policy. I can provide the PDF confirmation. But it only shows the last four digits.”
4. Extended family should not have access to your personal information
Don’t trust anyone with your personal information, even family members can unknowingly — or purposely — cause credit card issues.
What Happened: “I was the victim of ID theft when a family member opened a fraud account in my name. I have tried to dispute this account with XXXX but they keep saying it’s valid and it belongs to me. Of course it would look like it’s mine cause my identity was stolen!!!”
5. Do some background information on a prospective investment, especially if it involves a lot of money.
Research the company, make sure you are taking the minimum possible risk, assume it’s a scam. This person was scammed out of thousands of dollars while the credit card company stood by unsympathetically.
What Happened: “My elderly father was a victim of fraud and financial manipulation by a timeshare company. He lost [$150,000.00] by sending separate wires to XXXX believing he was selling his timeshare. He subsequently took a trip to XXXX and was told by the timeshare company that if he upgraded his timeshare for [$50,000.00], that he could sell it within three years for [>= $1,000,000]. He used credit cards for a down payment of [$24,000.00]. Once this was discovered, we put a halt to the payment. The credit card companies are demanding payment. I have claimed fraud and financial manipulation of an XXXX person, which is against the law in our state, but it doesn’t seem to matter. The credit card company is supporting the fraud and manipulation. We don’t know where to go for help. There doesn’t seem to be any resource that helps XXXX victims of fraud. ANY direction that you could point us to would be very helpful. As his son, I have my father’s POA and can act on his behalf.”
6. Frequently check your credit report as a safeguard against identity theft.
Imagine applying for a checking account and finding out that your social security number is already in use. Your credit report is essentially a biography of your life. Use it to your advantage when you suspect identity theft.
What Happened: “Someone has stolen and used my personal information to commit theft, and charges have been placed under my name. Since I have never had any open account with XXXX, I have never received any bank statement from their branch. However, I received the information from my XXXX XXXX account stating that I have unpaid fees under the account. Therefore, my credit score has decreased dramatically from excellent to fair status.”
7. Check how your credit card company is sending your bill.
Part of the responsibility that comes with owning a credit card is that you pay off your monthly balance before the due date. Some credit card companies have adapted to the paperless world by forgoing the monthly bill in the mail. If you haven’t received your bill in a few weeks, assume they have not notified you about the switch to paperless.
What Happened: “After 20 years of perfect credit with XXXX, they switched me to a paperless account without my permission, resulting in hundreds of dollars in late charges and fees (and a dip in my XXXX score from XXXX to XXXX).”
8. Threaten to take your money elsewhere if your customer service rep gives you the runaround.
Customer service can leave you steaming. Recognize that you are not important to your credit company, your money is. Threatening to take your money to a competitor should grab your service rep’s attention.
What Happened: “XXXX approved a fraudulent credit card in my name. A XXXX representative revealed to me that XXXX ” pushes through applications despite the fact incorrect information was used to illegally obtain a credit card in my name. A XXXX representative was combative and hung up on me, the victim of XXXX illegally issuing a card to someone using some of my personal information.”
9. Have your facts straight before talking to the police
It doesn’t take the deductive skills of Sherlock Holmes to figure out that the victim didn’t willingly give their credit card to an unwanted house guest. Document any evidence that would help you in the event that you go to court over damages.
What Happened: “Before I had an unwelcome guest in my home removed by police on XX/XX/XXXX, he stole my XXXX credit card out of my wallet, without my knowledge. He proceeded to use it for four days and charged over [$800.00] dollars [to the card]. I didn’t know the card was gone until I received a call from XXXX asking about fraudulent charges. I said it was fraud and they told me to file a police report, which I did. I spoke to the detective twice and told him the situation, then I never heard back from him at all. I received no information until I got a bill from XXXX showing the fraudulent charges were added back onto my account. I called and their fraud investigator told me that the police determined that I gave the thief my card to use so I was liable for the charges. I had no opportunity to dispute the claim and ultimately had to pay for the charges so that my account would not be overdrawn and affect my credit score.”
10. Don’t take credit card advertisements at face value
This tip falls in line with conducting thorough research before choosing which credit card is right for you. Credit card companies have teams of lawyers who find convoluted loopholes and clauses all in the attempt to retain the least liability.
What Happened: “My card was stolen while I was hospitalized. I reported the fraudulent use to XXXX. However, several of the charges were charged back to my account. XXXX advertises zero responsibility for fraudulent use but claims that because the chip in the card was used that I am responsible for the fraudulent charges. I have requested several times to the Fraud Department to credit my account, but requests have been ignored. My account is basically paid in full and should have zero balance. However, the fraudulent charges totaling [$460.00] are on my account, and I am being charged interest on fraudulent charges. In addition, my payment date and address was changed, and I questioned whether a duplicate card was mailed and/or a data breach at XXXX.”
11. Keep a log of all abusive collection calls
Your first line of defense against an obtrusive collection agency is to log any and all interactions. Keep a memo of any foul or threatening language, late night calls or frequency of calls.
What Happened: “I have a credit card with XXXX bank Simplicity card. On XX/XX/XXXX my mom lost her card which is the same number as mine, after she paid her XXXX center. Then after I went online and placed a hold on my account so no charges could be put through, I found out there are XXXX in additional charges on the account. When I called XXXX bank they made me hold for 54 minutes, and continued to disconnect the call, and then lied to me and told me prior to that the charge went through on XX/XX/XXXX when I have proof it was charged on XX/XX/XXXX after the lock date on my card. Now I have an additional XXXX of charges on the card which they still keep avoiding on explaining what the charges are, and keep passing me around.”
12. Freeze your credit and opt out of preapproved credit card offerings for the time being
If your credit card company issues you a new credit card without you having applied for it, you are probably the victim of identity theft. Freeze your accounts immediately before inquiring what has happened.
What Happened: “XXXX issued a Amazon.com Visa Signature card without me applying for it after they sent me a letter that they had insufficient documentation for issuing that credit card, for which I have never applied.”
13. Add extra layers of protection
Data that is typically exposed in hacks can result in SIM swapping. Use two-factor authentication and utilize the option to have a PIN. While it might be annoying to always have to punch it in, these added steps make your account that much more secure.
What Happened: “On XX/XX/XXXX hacker(s) took control of my XXXX XXXX phone line using a method that I have now learned to be SIM SWAP. My phone had no network connection and had no access to my SMS messages from XXXX to XXXX PST on XX/XX/XXXX. They used their access to my phone line (and therefore phone number XXXX) to change my Bank of America password through text verification. They also created a new phone line (# XXXX) which was the same number that money was fraudulently transferred to using XXXX to an unknown person by the name of XXXX XXXX. I wasn’t even aware of what XXXX is until this happened and never used XXXX transfer before.”
14. Don’t be lured in by free trials and offers
There are sites that claim to offer free credit reports, but if you’re not careful you could end up paying for it. The 2003 Fair and Accurate Credit Transactions Act gives consumers the right to get a free credit report every year from each of the three credit bureaus — TransUnion, Equifax and Experian — through AnnualCreditReport.com. If you’re signing up for a “free trial” that requires credit card information, chances are you’re on the wrong site.
What Happened: “I signed up for XXXX thinking it was a free credit report. They asked for personal information like name, date of birth. And when I got to the bottom it asked for my credit card information. I was hesitant at first to put it in and then I wondered, why does TransUnion want my credit card? It stated it was for further verification on my personal info, like if my address matched and so forth, so I entered my card number. Later, I got to checking my account to see if my previous activity that I made on XXXX went through and sure enough I was charged [$26.00] from XXXX!!!!!!!!!.”
15. Be careful about adding authorized users
Unless there is a very good reason, be wary about granting another person access to your financial accounts, especially a stranger. Stranger-danger is still real well into adulthood.
What Happened: “I was given a job offer. I accepted the job offer and worked for this individual for one month. I was sent a check for {$4900.00}. I called XXXX after I mobile-deposited my check to say that it didn’t look right and I thought it was a scam. When I called XXXX to cancel the check, they stated they couldn’t cancel (even though I said it could potentially be fraud) and they had approved of it the next day. During that time, that individual that I worked for hacked my information and sent money through the XXXX. I woke up to {$0.00} in my checking and savings AND my credit card was at it’s full max.”
What to do when you think your credit card is compromised
After the initial stress of finding out unauthorized charges on your credit card account, take a deep breath and calm down. Everything can be resolved.
Lock your card. Some cards let you lock or freeze your credit card online or through your mobile app. If this is a possibility, use it.
Call your credit card provider. If the card is physically present, call the number on the back of your card. Otherwise, look for the number on your credit card statement or online. Credit card providers have zero liability policy, meaning you won’t be held liable for unauthorized charges you report to your card issuer.
Review your credit card transactions. Make sure you note all transactions you didn’t make. You can also check your other credit card transactions to make sure they aren’t compromised as well.
Change your password and PIN. Proceed to change your password and credit card PIN to prevent additional unauthorized charges.
Call the credit bureaus. If multiple credit card accounts are compromised, call the credit bureaus. In this case, you may also call the police and file a report — especially, if you suspect identity theft.
Find a credit card that you’re least likely to complain about
Ultimately, life happens to the best of us. But if credit card fraud strikes, we want our banks to handle it quickly and promptly so we don’t have to submit a complaint to the CFPB. Find out which credit card issuers are least likely to receive a credit card fraud complaint before applying for your next card.
Casey Kozieja is a Finance PR Specialist at finder.com, working to help millions of Americans make smart financial decisions. She earned a bachelor’s degree in public relations from Penn State University. Prior to Finder, Casey worked in entertainment PR, helping to publicize musicians and films. In her spare time, she enjoys traveling to new places, hanging out with friends and searching NYC for hidden shopping gems.
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