November 21, 2022
Credit card fraud is when a payment is made with a credit or debit card without authorization from the cardholder. Unauthorized users steal a payment card or its digital information to purchase goods or services. Criminals can also use this card information to transfer funds to their personal accounts.
Some forms of credit card fraud include:
Credit card fraud is a global concern. However, speaking more closely to home, millions of Americans become prey to financial criminals annually.
Credit card fraud not only costs a cardholder, but it also costs their issuing banks, credit card networks, and the federal economy billions of dollars every year.
On the plus side, many fraud cases can be disputed. Which means a cardholder would not be held responsible for unauthorized charges. However, someone must take on the liability.
Typically, it’s a financial loss for merchants, banks, and credit card companies. This causes a snowball effect, which can take a damaging toll on the economy as a whole.
According to a recent annual report, about half of all Americans have fallen victim to credit card fraud. Out of those 127 million Americans, ⅓ had also experienced fraudulent charges numerous times.
With how common credit card fraud is, it is best to know what you are up against and how to better protect yourself. The below statistics from researchers can better help you understand the severity of financial crime and how Americans are impacted.
The FBI has issued warnings of virtual kidnapping ransom scams. These scams occur when a phone call is issued to a victim stating their loved one is being held captive. They may even have someone screaming in the background to make the call seem more legitimate. This is usually a scam.
Next, the caller will request money to be wire transferred or credit card information to be sent as ransom. If the callee agrees to send the requested money, the caller may then demand additional payment claiming they never received the first transfer. This type of scam usually targets older generations who are least suspecting.
Hackers can attempt to steal your personal information and credit card data stored on your computer or smartphone. They will send emails with links or attachments that when opened, will download spyware.
Spyware is a virtual virus that can export stored information on your personal device to the hacker’s device. Always be vigilant and avoid clicking on unfamiliar links or attachments. And remember to equip your devices with antivirus software protection.
Public WiFi in areas like airports, stores, and hotels can easily be monitored. If a cardholder is shopping online, enters their credit card information, or opens private files, this data can be at risk of theft.
Installing a Virtual Private Network (VPN) can protect your information from public networks. VPNs encrypt online identities and data which makes it more difficult for cybercriminals to gain access to your information.