6 Steps to Avoid Credit Card and Debit Card Scams

 

How often have you seen charges that ranges from $2-$30 and for a second you wondered what the charge was but ignored it.  Don’t!  This is a sign that you may have a victim of fraud.

The Federal Trade Commission (FTC) has been cracking down on debit card scams.  However, most of the charges are not disputed. In addition, some charges are not detected by bank antifraud software. Some customers do not bother to dispute fraudulent charges or unaware of them. Here are 6 ways to protect your personal and business credit and debit cards from fraud.

Follow Your Intuition

Go with your gut feeling. Don't doubt yourself. 

Avoid Giving Out Personal Information

Do not give out your checking account number, tax id, personal or credit card or debit number over the phone or via email unless you know the company and understand why the information is necessary.

Verify the Caller

If someone says they are taping your call, ask why. Don't be afraid to ask questions.

Verify the Company Policies

Companies do not ask for your bank account information unless you have expressly agreed to this payment method.

Do Business With Well Know Companies

Do business with reputable companies.  Be sure the company website has a physical address that is verifiable and a phone number that is answered by a live person.  Verify the company phone number in the Verizon online yellow pages or conduct an internet search on the phone number. 

Report Fraud Immediately

Report the fraud to the FTC at ftc.gov by filling out an identity theft complaint form. Also report the fraud to your bank or financial institution.

More Identity Theft Tips

Identity thieves are always thinking of new ways to steal your personal information. Some people become victims of identity theft even though their credit card and debit card is still in their possession. This happened to me twice. There are sites that let thieves buy hundreds of stolen credit card numbers at a time. Here are 16 tips to prevent becoming a victim of identity theft:

1. Buy a sleeve: Purchase a credit card sleeve that blocks RFID transmission (skimming) so there is a lesser chance of having your credit card read while walking down the street. Beware of people who stand close to you or who lean against you on the side where your wallet or purse is held.
2. Aluminum foil: Wrap your credit cards and debit cards in aluminum foil blocks RFID transmissions and it is less expensive than buying a credit card sleeve.
3. Safety: Don’t reveal your credit card in public which increases the risk for skimming. Take the credit card out of the credit card sleeve or remove the foil when making transactions. You can also put your credit card in your front pocket or sock instead of your wallet. Women can put money and credit cards in your bra or sock. Wrap the credit card in aluminum foil and put in a zip lock bag to prevent moisture from deactivating the magnetic strip. Beware of camera phones.
4. Don’t trust caller id. Computers can scramble telephones numbers to make them look legitimate. Skip giving out personal information over the phone unless it is someone you do business with. Ask for their direct number and call back to give your information to ensure it is a real company.
5. Virus Protection. Install virus protection on your computer and smartphone that you pay for. Some popular ones for pc’s are Symantec, Norton Utilities and McAfee. Popular ones for smartphones are Symantec, Kaspersky and F-secure. Also use email protection to minimize spoof emails such as Spam Assassin, Barracuda or Mailwasher.
6. Cash. Pay for items with cash and use credit cards for emergencies only.
7. Debt. Pay down debt and keep the balance at 20% or less of the credit limit. If you notice an unauthorized charge it is easier to detect if you have a few charges on your card. Keep track of your credit card balances at least weekly. Pay balances in full each month.
8. GPS. Reduce using GPS on your cell phone. If satellite can track your location so can thieves.
9. Online. Only shop at well-known website such as Amazon, eBay or Yahoo.com. Don’t purchase items from third party sellers. Shop online at secure websites that use https or shttp.
10. Smartphones. Don’t store personal information on your cell phone or make transactions because you don’t know if you information is secure.
11. Downloading. Avoid downloading from your smartphone and your computer. Download only from trusted websites. Avoid using free software or shareware.
12. Wallet. Skip carrying your SSN or birth certificate in your wallet. Carry only the credit card you know you will use on a specific day.
13. Mail. Leave mail and other personal papers at home and store in a safe place. Check your mailbox regularly, hold mail during vacations.
14. Trash. Shred personal information and mix in with other trash.
15. Bank. Don’t use an ATM in a secluded area. Create PINs that cannot easily be guessed. Verify all monthly statements with your receipts.
16. Credit. Order your credit report at least once a year and verify all information is correct.

Can the CARD Act Stop Creditor Tricks to Keep You in Debt

Credit card companies use hundreds of tricks and gimmicks to keep consumers in debt. According to R.K. Hammer, the credit card penalty fees revenue will reach $20.5 billion in. Credit cards generate more than $2.5 trillion a year. The credit card industry is one of the largest fraud industries in the country. Here are some common traps credit card companies use to keep consumers in debt.

1. The minimum payment trap keeps consumers in debt and in most cases is not enough to cover the interest and finance charges that accrue each month which is why when you send in a payment your balance either doesn't go down or only goes down by a few dollars.

2. No maximum interest rate for credit cards and is not government regulated. Interest rates are regulated by each state.

3. High late fees are charged either when payments are sent after the due date or sent on the due date although the payment was received on time.

4. Credit card monitoring and credit card insurance. There is no need to purchase credit card insurance because there are so many stipulations when signing up for the insurance that it is to your advantage live below your means to pay down debt.

5. Some credit card term change as the wind blows and makes it difficult for consumers to keep up with the changes.

6. The credit card agreement or disclosure is created using fine print to make it difficult for most consumers to read and those who try to read it get frustrated because of the fine print. However, this document is very important and should be read because it tells you all of the restrictions and guidelines for using the credit card.

7. The payment address or due date may change as a way to confuse consumers so their payment arrives late and they get charged a late fee.

The CARD Act of 2009 will eliminate many of these creditor tricks but the credit card companies will still find ways to work around the law to make money. It is best that you read everything you receive from your credit card company, ask questions and know your rights as a consumer. You can find information on the ftc.gov/credit site.