Friday, June 14th, 2019
Credit cards can help make shopping for your everyday purchases as easy as a tap, click or swipe. But with that convenience come a few potential risks—to your money, your credit and your reputation.
Luckily, there are things you can do to help protect your credit cards and your credit from loss, theft or fraud.
To help protect against credit card fraud and identity theft, the key precautions are to pay attention to where and how you use your credit cards and to be careful to not disclose your personal information or other information that can be used to identify you like a PIN or password.
“Most credit card fraud is transactional in nature which may occur online," says Cyrus Hojjati, Senior Manager, Fraud Governance and Operations at Tangerine. And although avoiding suspicious or insecure sites is smart, not all credit card fraud is driven by compromised out of country or unknown sites.
“Using public Wi-Fi for any credit card financial transactions may compromise your credit card numbers if there is spyware or malware present—even if you're dealing with reputable merchants at local sites" says Hojjati.
Consumers can help to protect themselves by being cautious when inputting personal and other banking information on public Wi-Fi. It's important to use trusted Wi-Fi locations.
“Mobile banking and online credit card transactions are definitely the way of the future, and the banks have great security and cybersecurity measures to support them, but customers also need to be vigilant in making sure they're aware of where they're shopping and how they're processing their transactions," says Hojjati.
It's great to connect with family and friends on social media, but information like your name, date of birth and address are all fraudsters sometimes need to open a credit card account under your name.
“While new processes make it harder for fraudsters to do this, it's still taking place and a lot of that comes from compromises people make by sharing certain information online," says Hojjati.
We'd recommend that to help protect yourself, avoid sharing information like your complete date of birth on Facebook or other social media (omit the year, for example) and set your privacy settings to ensure that only people in your invited network have access to your profile and postings.
Customers need to continue to be aware of not falling for phishing emails and phone scams—like fake phone messages claiming they're from the Canada Revenue Agency. But these aren't the only ways that email and phone scams can occur. Before letting down your guard, remember that if scammers can't succeed one way, they'll try another.
Over 3,000 Canadians have fallen victim to the latest low interest credit card phone scam. An agent calls and offers to lower your credit card interest rate in exchange for a one-time fee. If you accept the offer, the agent asks to verify your credit card number, expiry date and security code. By disclosing this, the cardholder gives the fraudster valuable information to sell to people looking to commit identity theft—and could be charged several hundred or thousands of dollars.
To protect yourself, never give out any personal information over the phone without knowing who you're dealing with and taking steps to confirm that. “If they state that they're calling from a certain bank, you can ask for a call back and reference number, and then you should call the number that you have for that bank, if you bank with them, to verify whether the caller is legitimate," says Hojjati.
If you want to discuss lowering your credit card interest rate or other options if you are struggling with credit, talk to your bank that issued you the card first.
When travelling, take extra precautions with your credit cards by either keeping them on you or in a secure location like a locked hotel safe that you only have the password for.
Customers can notify their banks when they're travelling so the bank can flag any suspicious transactions, and follow the same precautions as you would when using your card locally.
PIN security is critical to protecting your credit cards. Don't share your PIN with anyone. “If you lose your card or someone steals it, you could be responsible under your cardholder agreement if the bank finds you didn't take proper steps to safeguard your PIN or card or report either of them lost or stolen as soon as you are aware of that ," says Hojjati.
You can give would-be fraudsters a run for their money by inventing a PIN that's hard to figure out or can't be easily guessed. “Try to come up with one that isn't aligned with anything obvious like your date of birth, address, or name of a family member or pet," suggests Hojjati.
Finally, report any lost or stolen credit cards—as well as unauthorized transactions—to your financial institution immediately. That means you should review your statements and account history regularly and promptly. Financial institutions will not typically hold customers responsible for unauthorized credit card purchases unless the customer has not followed the terms of their cardholder agreement, which generally includes this obligation of the cardholder to report these matters to the bank.
As an extra precaution, you can sign up for activity alerts with your card issuing institution and activity alerts with either your bank and/or credit reporting agency to monitor inquiries on your credit profile.