12 Tips to Avoid Credit Card Fraud

by Tom Fragala Archive

how to reduce the risk of credit card fraud

Credit and charge card fraud costs cardholders and card issuers as much as $500 million annually, according to the U.S. Department of Homeland Security. Credit card theft certainly isn't the only way a thief can commit credit card fraud. While federal law limits consumer liability in such cases to $50 (provided you report it promptly), we recommend you don't take credit card fraud lightly. Having to cancel a card can be a hassle; it may take a week or more to get a new card. Many consumers also have recurring automatic billing to their credit card, which would mean you'd have to contact several companies to change your account number — and risk missing a payment while your new card is in transit.

It isn't possible to prevent every possible instance of credit or charge card fraud from ever happening, but there are a number of steps you can take to make it more difficult for a thief to nail you.

Here are 12 tips to help protect yourself from credit and charge card fraud:

  1. Check your statements promptly, and double-check your accounts monthly (using all the receipts you saved, if possible).
  2. Don't leave cards, receipts or billing statements in the mailbox, in your car or lying around the house.
  3. Safely store all records of your cards, your account numbers and the phone number and address of each company.
  4. Never sign a blank receipt.
  5. Save all credit card receipts to compare with billing statements. This will help you detect whether a store employee tried to scam you by changing the purchase amount or tip.
  6. Sign your new or replacement cards as soon as they arrive.
  7. Watch your card during the checkout process, and retrieve it quickly.
  8. Report any incorrect or suspicious charges quickly, in writing, to the credit card issuer.
  9. Notify your card issuer well in advance of a change in address.
  10. Get a locking mailbox to prevent a thief from stealing your statements or any convenience checks that are mailed to you. (Stolen checks are worse to deal with than a stolen card).
  11. Never lend your card to anyone.
  12. Avoid giving your card number over the phone or online unless the company or person is known, trusted and reputable.

If your credit or charge cards were lost or stolen, or if there are fraudulent charges, call the card issuers immediately — don't delay. By law, you bear no responsibility for unauthorized charges once you contact the card issuer. We recommend you follow up in writing, just to be safe.