Thursday, January 28th, 2016
By Anne Papmehl
Shopping these days is as easy as tapping a plastic card on a machine, or entering your credit card number on a computer. But with that convenience comes certain risks: to your money, your credit and even your reputation. Fortunately, there are things you can do to keep your credit card and your credit safe.
Some of the more obvious security tips include: not sharing or lending your credit card, keeping your PIN to yourself, and avoiding leaving your purse or wallet unattended when out in public. But people may be less aware of the ways to protect themselves against credit card fraud. Maura Drew-Lytle of the Canadian Bankers Association says the recent conversion from magnetic strips to chip and PIN technology has resulted in a decline in "skimming," where crooks skim the information on the back of your credit card to create a duplicate and then use it. “But now we're seeing an increase in 'card not present' fraud, where the criminals get your card number and then order something online or over the phone," she says.
Keep personal details to yourself
One way fraudsters get your information is through email and phone scams. You might get a call or an email message informing you that a suspicious transaction has taken place, or that your account has been locked and you need to provide your card number and Card Verification Code. Once they have that information, they can run up a hefty bill on your card. Legitimate credit card issuers never ask for personal and credit card details over the phone or email, so if you get such a request, avoid disclosing any personal or credit card information and report it to your credit card company right away.
Be wary of suspicious calls
A more aggressive phone scam involves prepaid credit cards. The caller may pose as an agent from Canada Revenue Agency demanding immediate payment of unpaid taxes, or as a police officer claiming that your family member has been in an accident and you need to send money through your prepaid credit card to get this person out of jail. Once they have your card number, they can spend away on your dime. Again, refrain from giving out your personal and credit card information and report the call.
Watch out when online
When purchasing online, Drew-Lytle suggests you “do a little homework on that retailer before providing your credit card information." One way is to check the retailer's purchase site for a Universal Cardholder Authentication Field (UCAF)R logo, such as MasterCard SecureCode®. In addition to indicating if the retailer site is legitimate, this universal standard gives the retailer proof that the transaction came from the actual account holder. It's also important to review your account balances and monthly statements often. “Look for any transactions that you did not make and report them right away to your credit card issuer," she says. Credit cards issued by banks will not typically hold customers responsible for fraudulent purchases unless the customer has violated an element of their cardholder agreement.
Advice for travelers
When travelling, take extra precautions with your credit cards. “We say protect your credit cards like you would cash, so either keep them with you or in a secure location like a hotel safe," says Drew-Lytle. As an added precaution, you can notify your bank about your travel plans so they can assist in fraud monitoring and reduce potential disruption of your credit card service. If using a bank machine, be wary of free standing cash machines as they can be easy targets for thieves to install skimming devices. The automated tellers at banks or airports are a safer bet as they are usually surrounded by security cameras.
Protect your PIN
Finally, PIN security is critical to credit card protection. “Choose one that would be impossible for someone to figure out and don't share it even with your family. If they commit fraud, you may be liable because you've shared your PIN," Drew-Lytle says. When keying in your PIN, it's a good idea to make sure that no one can see what you're entering by covering the PIN pad with your hand or holding your wallet over it. Also, be wary of bank machines or purchase terminals that look abnormal or altered.
One of the most serious consequences of credit card fraud is someone stealing your identity and damaging your credit score. A ruined financial reputation can affect the way creditors, landlords or even employers see you. You may be forced to pay higher interest rates, be turned down for a car loan or apartment, or miss out on a potential job opportunity. For this reason, it's a good idea to check your credit report periodically to make sure your identity has not been stolen.
Credit cards are a wonderful convenience to us but when they get into the wrong hands, they can work against us. By being aware of the potential risks and applying these tips, you can keep your credit cards and your credit safe.
UCAF and SecureCode are registered trademarks of MasterCard or its subsidiaries in the U.S. and other countries.