Credit Card Fraud

An unpleasant by-product of the modern era and its many conveniences is credit card fraud. Everyone knows at least one friend or acquaintance who has been hit by credit card fraud, and how its ruined many people's credit scores. By their nature, credit cards are a payment method that's vulnerable to fraud and other forms of criminal abuse. As infuriating as credit card fraud may be, there are definitely ways to deal with it that can minimize the damage it could cause.

Keep an Eye on Your Credit Cards

Although it may seem like the Internet Age has fueled the rise in credit card fraud, the truth is that online credit card transactions are rarely a source of credit card fraud. The technology employed to protect online credit card transactions has evolved over the years, and millions and millions of transactions are conducted each day without a problem. By and large, credit card fraud is committed by people who get physical access to a card and record its relevant information. Once they've got it they can use it at will, either online or in person using "cloned cards" - dummy cards that have your credit card's information superimposed on it. That is why it's critical to get your card back as quickly as possible once you've given it to someone for use, and to be mindful of where you've used it should you need to recall that information.

The bottom line in preventing credit card fraud is to be ever-vigilant in your efforts to track your spending on a regular basis, whether physically or electronically.

What if I Think I'm the Victim of Credit Card Fraud?

Should the above efforts fail and you end up the victim of credit card fraud, there are important steps you can take to safeguards yourself from financial damage.

The first thing you should do when dealing with credit card fraud is alert your credit card company the moment you notice a transaction on your account that you're certain you didn't authorize. If you received any sort of unusual email in the recent past to which you responded, be sure to forward that email on to your credit card company since you may be the unwitting victim of a "phishing" scam - these emails try to trick recipients into disclosing their private financial information.

Once you've contacted the credit card issuer, be sure to notify your other credit card companies, regardless of whether there was any fraudulent activity on them or not, because chances are that if the thieves have access to one of your cards they could have access to the others. Alerting your other credit card companies to potential credit card fraud will keep them on their toes as they monitor the activities on your accounts. As a matter of fact, credit card companies are very pro-active about fighting against credit card fraud because credit card fraud constitute up to billions of dollars of revenue they could have if it weren't due to fraud.

As unpleasant as the specter of credit card fraud may be, it's heartening to remember that as clever and "resourceful" as credit card thieves have gotten over the years, they're still up against the equally clever credit card fraud departments who seek to stop them.

Have you ever been a victim of credit card fraud? Share with the Go Banking Rates community how you dealt with the situation.

Most people don't realize this but they can place what's called a "freeze" on their credit lines. A credit freeze can be placed by the holder of the credit line (depending on where you live - some states do not allow credit freezes). Credit freezes are not particularly common, and are primarily designed to protect victims of identity theft and fraud. Read on for more information on credit freezes.

If you decide you want a credit freeze, and you live in a state that allows them, what you're doing is essentially concealing your credit report from people you don't want to see it, and that's primarily new creditors who are hoping to offer you new credit cards. A credit freeze will not block your current creditors, such as your current credit card companies, from seeing your payment activity.

Credit freezes will prevent not just would-be creditors from seeing your credit report, but also landlords who are checking on you before agreeing to rent you their house or apartment. A credit freeze will also block anyone who might be considering giving you a loan, such as an automobile dealer or a bank.

If you decide you want to place a credit freeze on your credit report, you will need to do so by contacting each credit bureau - you cannot get a blanket credit freeze to cover all the credit report agencies. So, when you contact the big credit bureaus, such as Equifax, Experian, or TransUnion - each credit bureau will have their own policies on the credit freezing process, so be sure to follow all their rules. The same steps will be required when you want to lift your credit freeze, which is often referred to as "unthawing."

To learn more about frozen credit lines, credit freezes, credit reports, identity theft, and other issues concerning credit, be sure to consult with a financial advisor.

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