CREDIT CARD HELP: The basic fundamentals of credit cards
All you need to know to be a smart credit cardholder
By Lisa Rogak
Identity theft is often in the news, but there are a lot of misconceptions swirling around about how to best protect yourself.
While some identity thieves focus on getting your credit cards and maxing them out before you even realize your cards are missing, an increasing number are using other pieces of information about you — such as online shopping account or email login credentials — in order to steal your entire identity.
A 2017 study by Javelin Strategy & Research found that there were a record 15.4 million identity-theft victims were reported in 2016, up 16 percent from 2015. While losses from fraud increased by a relatively modest $700 million, card-not-present fraud increased 40 percent and account takeover fraud jumped 60 percent.
No one is immune to identity theft, but armed with a little knowledge about how identity thieves operate — and a little common sense — you can stay one step ahead of them.
1. Thieves don’t need your credit card number in order to steal it.
Conversely, thieves don’t need your credit card in order to steal your identity. Identity thieves are crafty; sometimes all they need is one piece of information about you and they can easily gain access to the rest.
As a result, says Heather Wells, a former recovery manager at ID Experts, an identity protection company, it’s crucial to lock up important documents at home.
“Secure birth certificates, Social Security cards, passports, in a safe deposit box or in a safe hidden at home,” she says. “And that includes credit cards when not in use.”
For example, never list your full birthdate on Facebook or any other social-networking websites. And don’t list your home address or telephone number on any website you use for personal or business reasons, including job-search sites.
3. Be careful with your snail mail.
“Follow your billing cycles closely,” says Lucy Duni, vice president of consumer education at TrueCredit.com. “If a credit card or other bill hasn’t arrived, it may mean that an identity thief has gotten hold of your account and changed your billing address.”
Al Marcella, professor at Webster University’s School of Business and Technology in St. Louis, and an expert on identity theft, suggests when you order new checks, you pick them up at the bank instead of shipping them to your home.
“Stolen checks can be altered and cashed by fraudsters,” says Duni.
And never place outgoing mail in your post office box or door slot for a carrier to pick up. Anyone can grab it and get your credit card numbers and other financial information. Bring it to the post office yourself.
4. Review all bank and credit card statements each month, preferably once a week.
Watch for charges for less than a dollar or two from unfamiliar companies or individuals. Thieves who are planning to purchase a block of stolen credit card numbers often first test to check that the accounts haven’t been canceled by aware customers by sending a small charge through, sometimes for only a few pennies.
If the first charge succeeds, they’ll buy the stolen data and make a much larger charge or purchase. They’re guessing — often correctly — that most cardholders won’t notice such a tiny charge.
In addition, many of the fraud alerts you can set on your accounts aren’t triggered by small dollar amounts.
Reviewing your credit report on a regular basis is also a good idea, but usually by the time a fraudulent transaction reaches your credit report, it’s too late.
5. If an ATM or store terminal looks funny, don’t use it.
“Make sure there is no device attached to any ATM card slot you use,” says Wells. “As a general rule, the mouth of a card receptacle on an ATM machine should be flush with the machine or have only a very slight lip.”
If it looks or feels different when you swipe your card, or has an extra piece of plastic sticking out from the card slot, it may be a skimmer, an electronic device placed there by thieves that captures your credit card information when you swipe it.
Check your accounts regularly for suspicious or fraudulent charges.
6. Identity thieves love travelers and tourists.
Scott Stevenson, founder and CEO of Eliminate ID Theft, an ID theft protection company, cautions travelers to be alert to strangers hovering around whenever you use a credit card at an ATM or phone, and to avoid public wireless Internet connections unless your laptop or smartphone has beefed-up security protection.*
“Sign your credit card with a Sharpie so your signature can’t be erased and written over,” suggests Echo Montgomery Garrett, a writer in Marietta, Georgia.
Consultant Sarah Browne of Carmel, California, had all but one credit card stolen from a hotel room. The card that was spared still had the “Please Activate” sticker on it. Though Browne had activated the card, she forgot to remove the sticker.
“The thieves must have known that you have to activate a new card from the phone number listed with the credit card company, so they didn’t bother with it,” she said, and since then, she leaves the activation stickers on all of her cards.
Indeed, when a thief struck a second time at a public function, Browne’s stickered cards were again left untouched.
8. Pay attention at the checkout line.
If a cashier or salesperson takes your card and either turns away from you or takes too long to conduct what is usually a normal transaction, she may be scanning your card into a handheld skimming terminal to harvest the information.
But they don’t need a handheld scanner to capture your information. According to Mark Cravens, the Anti-Scam Doctor and author of “The Ten Commandments of Investing,” they can take a picture of the front and back of your card with a cellphone or merely swap out cards.
“Look at your card when they hand it back and make sure it’s yours, and not another gold, silver or blue card that looks like yours,” he says. “You may not notice they swapped your card for days.”
9. Go paperless in as many ways as possible.
Sandy Shore, training manager with Novadebt, a nonprofit, New Jersey-based credit-counseling agency, suggests clients cut back on the mail they receive from banks and financial institutions by discontinuing paper bills and statements.
“Access your financial statements at the issuer’s website instead,” she says. This strategy has the added bonus of an environmental benefit.
Similarly, Vaclav Vincalek, president of Pacific Coast Information Systems, an IT security firm, recommends that whatever paper receipts and financial statements you do receive go through the shredder instead of into the wastebasket.
“Never throw away a credit card slip,” he says. “Instead, shred anything that has any number, name, address on it.”
10. If you suspect you’ve fallen victim to identity theft, file a 90-day fraud alert.
If you are worried that your personal information — credit card or otherwise — may have been compromised, contact one of the major credit bureaus (Equifax, TransUnion and Experian) and request an initial 90-day fraud alert for your credit report files with each bureau.
The alert grants you a free credit report from each bureau and instructs potential creditors to contact you directly before opening any new lines of credit in your name, decreasing the risk of unauthorized credit activity.
Then, if after reviewing your credit reports you discover fraudulent activity, consider taking the alert a step further and freeze your credit while you dispute the illegitimacies. However, unlike a free fraud alert, a credit freeze costs about $30 and locks your credit report, preventing all access to new lines of credit.
See related: How to spot and prevent medical identity theft, Infographic: Identity theft take an expensive, emotional toll
CREDIT CARD HELP: The basic fundamentals of credit cards