In the UK, over 24 million transactions worth 1,4 billion GBP take place every day (Credit Action 2008), which means that an awful lot of us have a ‘plastic pal’ or ‘flexible friend’. In fact plastic is fast becoming the new cash as we pay for most of our purchases with it. Increasing numbers of people shop online and in the majority of cases credit cards are the only form of accepted payment.

Now, with all that money going round and around via credit cards, it is inevitable that the fraudsters of this world will try to get their hands on some of it, and there are a number of various scams that they use to try and defraud credit card holders.

Common Types of Credit Card Fraud

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Counterfeit Fraud or Skimming
This is when a less than honest assistant, in a restaurant, petrol station, or shop, copies the data on the magnetic strip of your card, onto another card, before returning your card back to you. The skimmed card is then used for online purchases where a signature is not required (‘card-not-present’ purchases).

Things to do:
Always keep sight of your card during the transaction

Theft or Loss of Cards
If your credit card is stolen or you are unlucky enough to lose them, then chances are that the thief will use them within the first few hours of being taken.

Things to do:
Always keep your credit cards in a safe place.
Inform your credit card provider immediately if you lose your card or have it stolen.
Program the telephone number that your credit card provider supplied you with, to report lost and stolen cards into your mobile. Remember to write it down in your diary, just in case you are really unlucky and have your mobile stolen as well.

Postal Interceptions
Fraudsters sometimes intercept post in the hope of coming across a new card or check book.

Things to do:
If you are expecting a new card through the post and it does not arrive within a reasonable period, contact the credit card provider and the post office.

Card Details
If a fraudster manages to get hold of one of your statements or bill receipts, they could use the account details to access your funds.

Things to do:
Make sure you destroy any statement or receipt before throwing them away.

Identity Fraud
Fraudsters find out all about your personal details from discarded statements, utility bills, etc, to apply for and take out credit cards, loans, and even mortgages all in your name.

Things to do:
Make very sure that you destroy all paperwork that has any of your personal information on it, before throwing it away, cut it up into little pieces or buy a shredder.

Cashpoint Fraud
If a fraudster manages to steal both a card and the corresponding PIN, he/she can withdraw cash from the nearest cashpoint. More enterprising fraudsters tamper with the ATM so that it reads and stores your card details.

Things to do:
Don’t write down your PIN number, memorize it.
Make sure no one sees you inserting your PIN
Keep the printed slip
Put your card and cash safely away before leaving the ATM
If the ATM looks strange, don’t use it.

Credit card providers are constantly coming up with new ways to beat the fraudster, cards are now being issued with a photograph of the cardholder on it, in an attempt to stop the fraudsters using stolen credit cards to make face-to-face purchases. Credit cards now have holograms, secret imprints, secret messages all designed to make it more difficult for the thief to make a new card with a stolen credit card number.

Protect yourself against credit card fraud

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Don’t divulge your PIN number or password to anyone, and don’t write them down anywhere, and keep an aide memoir in the same place where you keep you credit cards. I know it is frustrating when you forget the PIN and after three attempts at inputting the number, the ATM ‘eats your card’. If you have trouble remembering your PIN, try changing it to a more memorable number, but be careful not to make it too easily identifiable, as this will only make the potential fraudster’s job easier.

Don’t throw away anything that has any personal financial information on it, without first making sure that the document or receipt is totally ineligible, it may be a good idea if you invested in a shredder. Never just throw any financial document or receipt away with the rest of the rubbish, as an enterprising, if somewhat smelly fraudster, could find them in your rubbish bin and steal your personal financial information.

Make sure your PC is fully protected with anti virus and firewall software and use an anti phishing filter. Anti-phishing software consists of software that attempts to identify the phishing content contained in websites and email. It is often integrated with web browsers as a toolbar that displays the real domain name for the website the viewer is visiting, in an attempt to prevent fraudulent websites from masquerading as other legitimate web sites. Anti-phishing functionality may also be included as a built-in capability of some web browsers. Anti virus software also proctects your PC from trojan horse viruses that can record private and personal information when your enter a web site to apply for anything, for example payment details.

Remember to keep your anti virus software up to date so that the anti virus software always has the latest anti virus definitions to keep you protected against the latest threats.
If you ever receive an email purporting to be from your bank, or perhaps, Ebay or Paypal requesting that you verify your password or financial details by following a link to a site, then this email is undoubtedly a phishing email. Commercial banks and organizations like Paypal and Ebay, would never request such information via e-mail and they all advise customers to delete all such emails received.

Don’t divulge any of your personal financial information to anyone. No legitimate Bank would contact you requesting that you tell them your personal financial details, so if you ever receive a phone call asking for such details, don’t do it. Get in touch with your bank and report the incident to them.
Always log onto any online banking or shopping sites by typing the address directly into your browser.
Be careful about sites you use for on line shopping, and try to use only secure sites, also check for the locked padlock or unbroken key symbols shown in your browser window.

You should always be careful when entering your pin number at ATMs, or when asked to enter your pin number into a keypad provided by the shop or restaurant (chip and pin). Make sure you hide the keypad from other people around you so that they cannot see what pin code you are entering on the keypad.
If the ATM looks in any way strange, as if it has been tampered with, do not use it.

Always check your credit card statements in case you have been a victim of credit card fraud. Not only do large sums of money disappear from victim’s accounts, but also fraudsters siphon off small sums of money hoping that their victim does not notice. Always file your statements and keep them until you feel they are no longer required, after which you must destroy them.

Insuring yourself against identity theft may seem a little over the top, but with an increase in the rise of phishing, identity theft and fraud, a new insurance product ‘identity theft cover’ has now appeared on the market. Many high street banks now offer identify theft insurance cover in case someone steals your identity and opens a bank account or obtains a credit card in your name. Although identity theft is on the increase, the above tips on how to protect yourself against it should be sufficient to avoid it happening to you. However, if identity theft is a big concern to you, then you could consider taking out identity theft insurance. It should be noted however, that banks already refund any money lost in the case of identity fraud, but identity theft insurance could help in restoring your credit rating and paying any fees associated with clearing your name.

If you are unlucky enough to become a victim of fraud, then make sure you contact your bank immediately, all banks have a 24-hour emergency number to report lost or stolen credit cards, and the number can usually be found on your credit card statement. It usually takes a couple of weeks to receive a replacement card, so the sooner you report the loss or a theft of a credit card, the sooner you will get a replacement.
Banks are obliged to refund any payment made by fraudulent means, providing you can show that you took reasonable care to protect yourself, and look after your credit cards and not leave yourself open to a fraudulent attack. Banks investigate all cases of fraud, and will not refund you if they discover that you divulged the number of your PIN code to someone else, or you did not inform them of the loss of your card immediately.

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