Common Credit Card Scams
Staying alert to some of the most common credit card scams can help you to protect yourself and your cards.
More from Credit Fraud and Protecting Your Credit Cards
7 January 2009
Common Credit Card Scams
It is important to check your statements when you receive them.”
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Theft or stolen card fraud
If your card is stolen from your wallet or home, a criminal can use it to buy goods and services. Most fraud of this type takes place before you have had a chance to report the loss. If this happens to you, report it to your card provider and the police straight away.
Counterfeit fraud
This is also known as skimming or cloning. A counterfeit, cloned or skimmed card is one that has been printed, embossed or encoded without permission from the card company, or one that has been validly issued and then altered or recoded. This can take place at retail outlets such as bars, restaurants and petrol stations where your card’s magnetic strip is electronically copied onto another card without your knowledge.
It can also take place at cash machines if a skimming device has been fitted. The stolen information can be sold to a criminal operation where counterfeit cards are made. You may not be aware that this has even happened until you receive your statement showing spending on your card that you did not do! This is also why it is important to check your statements when you receive them.
Cashpoint fraud
Another type of ATM fraud is card trapping. A device inserted into the cash machine card slot traps your card inside. As you re-enter your PIN, the criminal can then watch. When you give up and go away, they remove the device containing your card and withdraw cash using your PIN.
If your card is ever trapped inside a ATM, contact your provider immediately with all the details and let them know if you were unsuccessful in withdrawing cash.
Preventative measures to take if you want to withdraw cash from an ATM include:
Ensure that your PIN is not attached in any way to your card. Resist the temptation to write it down anywhere.
If the cash point looks like it has been tampered with don’t use it.
Cover the keypad with your free hand when tapping in your PIN. This might sound a bit secret service but if you don’t, you could leave yourself open to shoulder surfing. This is when criminals look over your shoulder and watch you enter your PIN and then try and distract you while stealing your card.
Put your card and cash away safely before you leave the machine.
Don’t chuck your printed slips away. Keep them to check against your statement and then shred them.
Card not present (CNP) fraud
This includes fraud via the Internet, telephone, fax, and mail order. If criminals obtain your card details they can use them to obtain goods without a PIN. This type of fraud was up by 37% last year, totalling £290.5 million and accounts for more than half of all credit card fraud losses.
Because the cardholder is not present it is harder to determine the physical security features of the card to see if the card and cardholder are genuine. Cardholders can’t guarantee that the information given on the CNP transaction is given by the real cardholder. This makes this type of fraud very lucrative for criminals. In this type of environment it is imperative that you keep your cards and details watertight.
Mail non-receipt fraud.
If your card is stolen in transit once it has been sent out, contact your card provider straight away. If you live in flats or halls of residence or anywhere that has communal letterboxes be aware that this can be a particular risk.
