Credit card theft is upsetting and often, like when travelling, incredibly inconvenient. But identity theft can be much more devastating and difficult to fix.
Credit Card Theft
You've likely had your credit declined, only to return home to a voicemail from your bank saying there was some suspicious activity on your account and they had to temporarily shut down your card privileges. Not a big deal, you realize, as you call up your bank, and after a few moments, you're again good-to-go with the same card. What happened with the compromise? You'll likely never know.
But if your credit card number is the victim of a larger issue, it may be shut down entirely and replaced with a new one. Again, not the end of the world, but if you're travelling and only have one card, this can put you in a difficult situation. A good tip is to have two major credit cards that you can use.
Keep in mind that you need to do your part to ensure that if you're a victim of credit card fraud you're protected. One of the most important things you need to do is keep your PIN and passwords private, protected and hard to guess.
“Consumers also have a responsibility to take an active role in their own protection," says Financial Consumer Agency of Canada commissioner Lucie Tedesco. “As I was handing over to my son his first debit card, I told him three things: Don't share your PIN with anyone — family, friends — don't do it! Change your PIN regularly to be one step ahead of the hackers. And make your PIN easy to remember but difficult to guess."
Identity theft
So, we've identified that credit card theft can be troublesome, but identity theft is much more severe and can devastate a person's financial life, since the responsibility is on you to clear your name if you fall victim. It's estimated that it takes up to 4 working weeks to clear things up if you find yourself in an ID theft mess.
“Identity fraud is the use of another person's — living or deceased — information in connection with fraud. Including, for example, impersonation, or misusing debit or credit card data," says Nancy Cahill from the Canadian Anti-Fraud Centre. The CAFC reports that 9,134 complaints of identity fraud were received during 2016, which translated into 8,105 victims and totalled $11,029,523.06 in losses. And that's only what's reported to the CFAC — most victims don't even reach out.
Here are some tips to avoid falling prey to fraudsters:
- Don't carry your Social Insurance Number card or birth certificate with you
- Lock up your passport and information-sensitive documents in your home
- Keep track of your mail — if it goes missing, fraudsters might be diverting it
- Ask why you're being asked for information such as your Social Insurance Number, date of birth and more
- Set up a “proactive" credit alert on your credit file with Equifax® and TransUnion® (these are the two main reporting credit agencies in Canada. The alerts cost $5 each and last 6 years. They provide an extra measure of protection by requiring that you be called when credit is being granted.)
While you can do everything possible to protect yourself from fraud, we're all aware of the frequency of data breaches where companies, governments and organizations with our information have been exposed to fraudsters. But, there are things within your control you can do to help lessen the likelihood of fraud.
Equifax is a registered trademark of Equifax Services Ltd.
TransUnion is a registered trademark of Trans Union LLC
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