How to Protect Yourself from Credit Card Fraud

Malware

Short for malicious software, malware is specifically designed to gain access to or steal information from computer systems and networks. Malware is often installed when users inadvertently click on suspicious links or download damaged files. The type of malware known as spyware is usually what transfers your credit card numbers and other sensitive information back to the offending party.

How to avoid it:
Being careful about what you click on and download can help protect you against malware, but quality antivirus software and/or a firewall designed to block unauthorized access to your computer and other devices are your best lines of defense.

Email phishing

A phishing email is a message that appears to come from a legitimate entity such as your bank, school or local utility company. These emails can include links to dangerous websites (riddled with malware) or request you provide your account password, date of birth or other information that can be used to commit credit card fraud. Phishers often use urgent warnings and high-pressure tactics to push you into revealing too much.

How to avoid it:
Reputable organizations will never ask you to provide such information via email. To avoid falling prey to email phishers, look closely at the sender's email address; it will likely look similar to a company's valid email with the exception of a single letter or number. When in doubt, contact the business directly to see if action is really required on your part. You should also delete the email message immediately, from both your inbox and deleted items folder.

Unsecured Wi-Fi

While convenient, free Wi-Fi at hotels, coffee shops and other public locations could expose you to hackers who can connect with any unsecured device on the network. As a result, a hacker can send malware to your computer or access sensitive information, such as your emails, passwords and credit card numbers.

How to avoid it:
When using the Internet in a public place, add a layer of encryption by enabling the "always use HTTPS" option on websites that require a login or credentials. You should also turn off Internet Connection Sharing (ICS) sharing in your computer's control panel or system preferences. Antivirus software can alert you if your system becomes compromised while connected to an unsecured wireless network.

Phone phishing (call or text)

While email phishing is a common gateway to online fraud, crooks also resort to deceptive phone calls and text messages as a means of double-crossing you. One such swindle might be an automated phone call asking you to confirm your credit card number in exchange for a lower interest rate on your account, or a text message claiming you've won a contest with "no strings attached" — so long as you provide certain identifiable information, of course.

How to avoid it:
Unless you initiate the exchange as a customer, chances are these communications are duplicitous in nature. If you receive such a text, don't reply or click on any links contained within the message; simply delete it. If you get an unexpected call from someone trying to sell you something or pressuring you into giving up personal information, hang up and report the incident with your credit card company and use the FTC's National Do Not Call Registry. It is also available in Spanish.

Snail mail

Though it's illegal to open mail addressed to someone else, would-be fraudsters may sift through your mail — before or after you've read it — in search of bills or other correspondence that could provide them with the information they need to create a counterfeit credit card.

How to avoid it:
Call your bank and switch to paperless; you will still be able to see all your card information via the bank's website. If you still want to receive your mail traditionally, always cross-shred documents with personal information and put a lock on your mailbox.

Skimming

Skimmers are small devices that scan data from the magnetic stripe on your credit card. Commonly installed at ATMs, restaurants, gas stations and other retail outlets, skimmers record information that criminals can use to make a counterfeit card or sell to a third party. Unfortunately, victims of skimming are often none the wiser until they receive an account statement listing goods and services they never bought.

How to avoid it:
Switch to an EMV or "chip" card to prevent skimming. These cards use a computer chip to keep transactions more secure. EMV, which stands for Europay, MasterCard and Visa, eliminates the need to swipe your credit card's magnetic strip to complete a purchase. Instead, EMV allows you to "dip" your card into the machine, providing enhanced consumer protection and making it more difficult for criminals to use what they steal. However, the transition to EMV technology in the United States, though ongoing, is far from complete; if you haven't been reissued a credit card (or debit card) with an EMV chip, contact your bank and ask when you can expect to receive one.

Cameras

Small cameras affixed to ATMs and hidden from view are designed to capture your PIN number. Often used in conjunction with data obtained via skimmers, thieves then burn the information onto a counterfeit card to access your money.

How to avoid it:
Cup your hand around the PIN pad when standing at an ATM, even if there's no one in your immediate vicinity. Avoid ATMs entirely that look like they've been tampered with or scratched around the area where you insert your card. Some skimmers look very like a part of the ATM, so if the card reader slot looks different than the straightforward slot you are used to — you may notice misalignment or mismatched colors — skip it and notify bank staff, if possible.

Old-school thievery

Though most perpetrators of credit card fraud are elusive and unseen, theft of your actual card is an ever-present threat, especially if you live in a high-crime area. In addition, you should know that EMV credit cards — while more effective than traditional cards — don't completely eliminate the risk of fraud. Your data can still be stolen and used to make online and telephone purchases where the chip isn't used to complete the transaction.

How to avoid it:
When shopping in a brick-and-mortar store, keep your wallet and/or purse with you at all times and don't let cashiers or salespeople disappear with your card. It only takes a minute to skim your credit card or otherwise copy your account number. Hang on to receipts for comparison against account statements so you can monitor unauthorized purchases. Immediately report any suspected fraud to your card issuer.