One of the things that make credit cards the best payment method for many folks is that consumers have very little liability for losses arising from fraud. The Fair Credit Billing Act caps those at $50, but in reality few card issuers charge even that. The law governing debit cards has a similar cap, but comes with more loopholes that cause some victims to bear much higher costs.
Whatever protection your plastic provides, being a crime victim usually means great deal of unwelcome hassle, and it's well worth taking simple steps to protect yourself from credit card fraud.
1. Keep Your Cards Close
For years now, criminals have been using cheap electronic readers to steal the information contained on cards' black stripes. This takes no longer than a normal swipe, so it's advisable to keep your card in view at all times.
More sophisticated fraudsters have taken to fixing versions of these machines to legitimate card readers on gas pumps and similar automated vending devices, so think carefully before putting your plastic into a slot that looks non-standard.
2. ...Or Keep Them Locked Up
If you have one or more cards that you use only rarely, it might be wise to keep them securely locked away at home. You might not notice for a long time that they're missing from your purse or wallet, which could give criminals the chance to run up some serious charges. Always check card statements when they arrive to make sure nobody's using them fraudulently.
Some advise keeping plastic separately from your money and identification, perhaps in a business-card holder or zip-up pouch. Pickpockets tend to target wallets and purses, and your problems could be smaller if they make off with one that's card-free.
3. Guard Your Card Info
Some criminals clone cards, creating excellent counterfeits,. But, with "card-not-present" transactions (orders placed online, over the phone or by mail), all that's often needed for a fraud is the card number and expiration date -- and sometimes the three-digit CVV (card validation value) on the signature strip.
By now, everyone knows to shred statements and other correspondence with that information. However, the rise of cell phones and smart devices with cameras means your card's information can be captured instantly and without your knowledge whenever you take it out. Many of these also come with video capabilities that can discreetly film your hand while you're keying your PIN into an ATM or other device. Cover the keypad when you enter your PIN, even if you don't see anyone watching you.
4. Protect Your PC
Cyber criminals have developed sophisticated computer applications that can identify card and bank information when you're buying online, and then send the information directly to the fraudster. The same applies to log-on information when you access financial accounts.
Thieves have also developed effective ways of getting those applications onto your desktop, laptop or smart device. However, these usually involve you agreeing to download an apparently innocent application (maybe a free game or set of icons), or clicking on a link in a dubious email from a source you don't know. Avoiding such actions is your first line of defense. However, there are three others:
- Keep your operating system and browser up to date.
- Use a firewall.
- Install a reputable anti-virus application. Make sure you keep it up to date, and use it to scan your entire system regularly.
5. Take Care Using Public WiFi or Computers
It's easy for hackers to intercept data on open WiFi services, so avoid using these to access your financial accounts or make online purchases. Take even greater care when using public or shared computers -- including yours at work, if others ever use it. (Are you sure the cleaner doesn't while you're not there?) Don't save sensitive log-in information, especially passwords, on these, and fully close your browser after a session when you've accessed accounts or bought something. Otherwise someone else may be able to press the Back button to open past pages.
6. Don't Fall for "Phishing"
Phishing is one of the most invasive forms of fraud because it tricks you into doing something dumb. Often, you receive a text, email or call, allegedly from your bank or card issuer, usually claiming there's an issue with your account. The aim is to get you to voluntarily provide enough personal and account information to enable a major fraud or even a complete theft of your identity.
A link in a text or email may direct you to a website that looks just like your bank's or credit card company's. But it's just a clever copy, and if you log in, you''' give away the keys to your account.
Banks and credit card companies NEVER call or write asking for account or card details. If you receive a call, email or text requesting them, or asking you to log on to your account via a hyperlink it provides, call the phone number on your card or bank statement (not one provided by the fraudster) to check whether there really is a problem.
7. Shop Smart
Provide your card details online or over the phone only when you have to -- and only if you're sure the merchant you're dealing with is legitimate. If you're buying something from a company you've never heard off, check its credentials through the Better Business Bureau and carry out an Internet search.
Plastic payments should only be made securely, so check that there's a padlock icon on your screen, or that the website's URL begins "https://" rather than "http://".
Use Your Credit Cards
Whether you're shopping in a brick-and-mortar store or online, your credit cards can provide a whole lot of benefits that you simply don't get with other payment methods. Those include the best protections against being responsible for fraud losses. So, unless you're one of those people who can't do so responsibly, do use your plastic whenever possible.