Sooner or later, we are all likely going to be victims of credit card fraud. Yesterday, it was my turn. Someone used my card in the Midwest, but I don’t live there, and I had my card in my wallet. Fortunately, three things occurred. First, I got an alert from my credit card company on my phone that flagged the purchase. $86 at a grocery store. Nope, not me. Second, I called and they immediately froze the account so no further fraudulent charges would occur. Third, as has been the case for years, liability for fraudulent charges is typically zero.
I am mad of course; but since it wasn’t my primary card information that was stolen, I don’t have to memorize a new sequence of credit card digits (trust me, in comes in handy). I am mad because someone “physically” used my card at a grocery store and not online which would make more sense if my information had been stolen. I have one of the new chip and PIN cards (they look like this picture to the left), which is supposed to combat this type of thing. Perplexed, I did a little research on this topic and apparently it’s easy enough for thieves to “clone” your card. The following article from WFLA explains how credit card fraud can occur (probably provides too much info, to be honest) even when you haven’t lost your card. A lesson for us all.
Where does credit card fraud begin?
Now, you might ask, how did they get my card info? This is where the disturbing part comes in. Forget the typical hack job that has occurred all too frequently lately (Target, for example), there are a few different ways this information could have been stolen. One, the thief used a “skimmer,” which is a small device that can be attached to Point of Sale (POS) machines, such as gas pumps and ATMs. They can be very hard to see, though. Unbeknownst to the victim, they think they are using the machine like normal, but when they place their card in it, the skimmer is either taking a picture of the card or capturing the card information as the transaction is processed. Be on the look out for anything odd, especially on standalone ATM machines that are a huge ripoff anyway. Two, when I used my card at a restaurant the thief skimmed the information when I wasn’t looking. Three, they just copied the information down on paper, etc. and stole it that way. In Canada, and I am sure the case in other countries, too, I actually swiped my own card at a restaurant where I ate. That ensured my card was never out of my sight.
In the end, we are all paying for credit card fraud in the form of higher fees and other compromises. The key takeaway is to keep a close watch on all of your statements, use a service like Bill Guard (free), and report anything odd right away. $86 is nothing to sneeze at, but more than likely it was a test to see if the stolen card could be used fraudulently on much larger purchases. Nobody wants that.