4 Tricks for Safeguarding Yourself from Credit Card Fraud

Though it is more convenient than ever to pay online and nearly everywhere with a credit card, identity fraud is growing as result — affecting one American every two seconds1.

From security breaches to more targeted thefts involving credit card information, consumers have to become more vigilant about protecting themselves. Here are four easy activities you can do to prevent yourself from becoming a victim.

1. Create stronger-than-steel passwords.

Since your password is the gatekeeper to your financial information, make sure you take the time to make it strong and guess-proof. Combinations of numbers, letters (uppercase and lowercase) and symbols are best, and a longer password is better than a short one.2 You want to make your password random rather than using words you can find in the dictionary. Avoid using common words or phrases that could be easily guessed.

Also, change your passwords often. Some security experts advise that changing passwords monthly, or even weekly, is a good move that can pretty much guarantee your account can’t be compromised.

2. Be careful about sharing financial information.

It might seem like common sense not to share your credit card or other financial information online, but Internet theft has become increasingly sophisticated and sometimes hard to detect, including a variety of “phishing” schemes. Spoofed email and websites, which may look on the surface to be identical to the legitimate ones, try to lure users into sharing passwords and other information.

Be skeptical of any email claiming to be related to your financial institution. Check the sender information carefully — ensure that the email address matches the company name. Don’t automatically click the urls in the email — instead copy and paste them into a separate browser window to see if they match up with the alleged company.

Finally, don’t share your financial information in an email or by phone — and if you have any doubts about the legitimacy of a website, email or phone call soliciting information about you, disconnect and get independent confirmation. You should always be able to contact your credit card company or financial institution in order to do this. It’s an extra step, but it’s better to be safe than sorry.

3. Don’t use public Wi-Fi connections for purchases or banking.

Using an unprotected Wi-Fi connection while at a coffee shop or out in any other public place can be a scenario ripe for credit card fraud, since the unprotected connection can allow hackers to access the information you’re transmitting.

Instead, while working outside of your home or office’s protected Wi-Fi connection, use a virtual private network (VPN) to encrypt data. And also, even when you’re at home, always be sure that when sending financial information such as credit card numbers that you are connected to a website using https.

4. Scrutinize your statements.

You may be comforted by the paper trail created by your credit card through receipts and online statements and lulled into a false sense of security. Like many Americans, your life is probably busy and stressful, and you might not always make time to check over your statements carefully.

The problem is that credit card scammers are banking on this fact. Often, once they get a hold of your credit card information, they will begin making small, insignificant charges — ones that the average credit card holder might not pick up on while skimming over a statement. Over time, these kinds of charges can add up to thousands of dollars — all because you weren’t as vigilant as you should’ve been.

So take the time weekly or monthly to sit down and go over your statements. Match up your receipts against your statements, and watch out for recurring charges that seem suspicious. You can flag any suspicious charges or follow up with the merchant for clarification.

But if you do suspect fraud …

Don’t hesitate to act quickly at the first sign of fraudulent activity. Consumers generally aren’t liable for fraudulent charges, but you must notify your company immediately3 after you discover the activity to minimize losses. Call your credit card or financial institution and alert them of the problem so that they can freeze your card from any future theft. They’ll walk you through the appropriate steps to take, and hopefully help you to prevent a similar situation in the future.

Sources:

1 http://www.myfico.com/crediteducation/idtheft.aspx

2 http://www.nerdwallet.com/blog/finance/advisorvoices/protecting-financials-onlin/

3 http://www.consumer.ftc.gov/articles/0213-lost-or-stolen-credit-atm-and-debit-cards

Legal Disclaimer: This site is for educational purposes and is not a substitute for professional advice. The material on this site is not intended to provide legal, investment, or financial advice and does not indicate the availability of any Discover product or service. It does not guarantee that Discover offers or endorses a product or service. For specific advice about your unique circumstances, you may wish to consult a qualified professional.

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