Credit card fraud is a big problem in Canada and around the world. While credit cards are more secure than ever, criminals are getting increasingly smart, and there are several types of credit card frauds where you can become a victim.
Fortunately, there are some simple ways to avoid credit card fraud, which we’ll look at in this guide.
We’ll also look at tips on what to do if your card gets stolen and how to report credit card fraud.
What is Credit Card Fraud?
Credit card fraud is when your credit card is used without your permission.
It may be stolen and used, or someone may copy your card information and make fraudulent purchases this way.
General Ways to Avoid Credit Card Fraud
Here are 12 of the best general ways to avoid being affected by credit card fraud:
1. Keep Your PIN a Secret
First, the golden rule is to always keep your PIN a secret. You should never share this four-digit number with anyone.
No one should legitimately ask for it, so don’t be fooled if someone claiming to be from the bank asks for it over the phone or via email.
And don’t keep your PIN written down anywhere near your card because if someone finds both your card and your PIN, they can withdraw money from your account. So it’s always best to memorize your PIN instead.
2. Cover the Machine when Entering Your PIN
When you enter your PIN at the ATM or when making a purchase, always make an effort to cover up the numbers you are typing in.
You never know who might be looking, and once someone has found out what your PIN is, they can target your card, knowing they can steal money from your account.
3. Keep Your Credit Card in a Safe Place
Always protect your credit card as if it were cash. That means keeping it in a safe place at home. Also, keep it safely in your wallet or handbag when you are out and about.
4. Limit the Number of Credit Cards You Carry
Try to avoid carrying all of your credit cards together. Instead, use one credit card as your main card, and maybe carry a backup one.
If you carry several cards together and someone steals your wallet, they will get access to all of your cards. Keeping more cards at home means you can make purchases while waiting for the bank to replace your stolen card.
5. Keep Your Credit Card in the Same Place
Get into the habit of keeping your credit card in the same place. At home, have a place where you keep it, preferably in a drawer or somewhere not easily accessible should someone get access to your home.
6. Sign the Back of a New Credit Card
Signing a new credit card is less important than it once was. However, as soon as you receive your new credit card, always make signing the back the first thing you do.
If someone else gets hold of your credit card before you sign it, they can add their signature, so this is another simple security measure you can take.
7. Keep Credit Card Statements in a Safe Place
It’s not just your card that you should protect: keep your statements safe too. These contain a lot of personal information fraudsters can use.
Keep your statements safely in your home, and shred them when you no longer need them.
8. Destroy Old Credit Cards
It’s always a good idea to destroy old cards when you no longer use them or they go out of date. This is another simple way to reduce the risk of someone using them for fraudulent purposes.
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9. Review Your Credit Card Statement Monthly
Always check your monthly credit card statement and look for potentially fraudulent transactions. Then, contact your card provider immediately if you don’t recognize a transaction and think it has been made fraudulently.
10. Check Your Credit Report for Errors
You should also get into the habit of checking your credit report regularly. If your card is used for fraudulent purposes, this can impact your credit score.
11. Pay With Your Phone
Instead of paying with your credit card, add your card details to your phone and pay with that instead.
For example, you can use Google Pay or Apple Pay to keep your cards safe at home.
12. Keep Your Credit Card in Sight at All Times
Never let your card go out of sight, where it can be copied and used to commit fraud. This is more problematic in restaurants.
If the waiter needs to take your card, always go with them. Don’t let it out of your sight.
Related: Avoid these expensive credit card mistakes.
How to Avoid Credit Card Fraud Online
Has someone used your credit card to buy online? Unfortunately, a lot of credit card fraud these days happens on the internet.
Here are some of the best ways to avoid being a victim.
13. Don’t Keep Your Credit Card Information Saved Online
Avoid saving your card information anywhere online. If the details are online, they can be exposed to hackers, and the details can be sold online.
14. Report Any Suspicious Activity or Transactions
As soon as you notice any suspicious activity or transactions on your card, contact your card issuer immediately and report them.
If someone is using your card fraudulently, your issuer can take action by cancelling the card.
15. Only Use Trusted Websites When Shopping Online
Do not enter your card details on any website you don’t trust. Make sure it has an SSL security certificate, and don’t risk it if you are unsure.
16. Avoid Using Public WiFi or Computers to Do Online Shopping or Banking
Never enter your card details on a website when connected to a public WiFi network or using a public computer. These are not safe.
Only shop online from your own devices using your home WiFi network or phone network.
17. Clear Your History and Cookies After Using a Public Device
If you use a public device and enter your card details at any time, end your session by clearing your browsing history and cookies so no one can access your information.
18. Keep Your Anti-Virus Software Updated
Anti-virus software can protect your computer and phone from malicious software and hackers. However, make sure you keep it updated regularly to protect your information.
19. Be Careful of Phishing Emails
If you receive an email that looks like it is from your bank and it requests sensitive information regarding your credit card, never click on the links.
Instead, visit your bank’s website directly or call up customer service to check first because it could be a phishing email.
Ways To Avoid Credit Card Fraud on the Phone
Credit card fraud can also occur on the phone. Here are some easy ways to avoid credit card fraud on the phone.
20. Do Not Give Credit Card Information Over the Phone to Untrustworthy People
If anyone asks for your credit card information over the phone and you are not 100% sure, don’t give it to them.
Only provide your information if you have initiated the phone call and trust the merchant.
21. Don’t Say Your Credit Card Information Out Loud if People Are Listening
If you are in a public place and people can listen to your phone call, avoid saying your card information out loud. They could gather the information without you realizing it and use it maliciously.
What to Do if Your Credit Card Gets Stolen
If your credit card is stolen, call your card issuer immediately. They should provide a number for lost or stolen cards.
They can then cancel your card to prevent it from being used, and you can ask them to send you a new one.
How to Report Credit Card Fraud to the Police
Credit card fraud is a crime. If you discover that your card has been used fraudulently, get it cancelled first, then contact your local police service to file a police report.
What Were Some of the Biggest Credit Card Frauds in History?
There have been several large credit card frauds throughout history, and one of the largest frauds in Canada occurred in 2002.
Police found tens of thousands of credit cards leading to the arrest of two men. The cards had been used for between $10 and $15 million dollars of fraud.
One of the largest credit card frauds of all time was a $200 million scam in the United States that the FBI took down in 2013. It involved creating false identities and the criminals applying for cards and making purchases at fake companies to launder the money. 18 people were jailed.
Related: Read these interesting credit card statistics in Canada.
Do police investigate credit card theft?
If your credit card is stolen, contact your card issuer to cancel the card. If no fraudulent transactions were made, you might not need to contact the police. However, if fraud is committed, police may carry out a credit card fraud investigation, so you should at least report it.
How often do credit card frauds get caught?
When it comes to credit card fraud, punishments can be severe. However, very few credit card fraud cases are resolved unless they are very large cases. Therefore, it’s always best to take measures to avoid becoming a victim in the first place.
Can I get my money back if someone used my credit card?
Yes, you may be able to get your money back using credit card chargebacks.
Can they track who used my credit card?
If your card is used fraudulently, it can be very difficult to find out who made the transaction, especially if it was used offline.