Seven ways to avoid credit card scams


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Your credit card isn't just useful to you, it can also be highly valued by crooks. But a few simple steps can protect you against scams.

It's great to learn that credit card fraud has fallen dramatically in recent years. Data from the Australian Payments Network shows that in the 12 months ending  June 30, 2020 fraud dropped 15%, reflecting industry efforts to make cards safer.

Even so, there's no room for complacency, and fraud is something we all need to take seriously. Here are seven simple ways to avoid becoming a victim of card scams.

has my credit card been scammed

1. Keep your card safe

Credit cards are increasingly becoming contactless, making it critical to store your card in a safe place. If your card falls into the wrong hands, it's easy to rack up plenty of purchases below $100 - possibly before you've even noticed the card is missing.

Regularly check you have your credit card on you, especially while you're out and about.

2. Be mindful of mailbox security

Thieves can - and do - raid letterboxes, looking for new or replacement cards sent through the mail. It makes sense to secure your mailbox with a padlock and empty it regularly, especially if the bank has notified you that a card is on the way.

3. Shred paper statements

As crazy as it may sound, crooks have been known to go bin-diving for discarded credit card statements. Armed with your account details, they can make purchases where a signature isn't required - either over the phone or online.

Opting to receive digital card statements can eliminate this problem. If you print statements, shred the paperwork before sending it to the recycle bin.

4. Don't respond to random requests for card details

Always be suspicious of unsolicited emails, phone calls or text messages. Never click on links within emails, especially if it's from an unknown source, and don't be tricked into handing out your card details to strangers.

5. Stick with trusted websites

When you're shopping online, stick to websites you know and trust. Only provide card details on secure sites - those that display a closed padlock or key icon next to the website address.

If you're unsure about a website, check out a few Google reviews. They could show if you're dealing with a shonky site.

6. Don't hand your card over

Card skimming has declined markedly in recent years, but it still accounts for $14 million in losses annually. Skimming occurs when your card is read by an illegal device that looks similar to a legitimate card reader, or if you use your card at an ATM that crooks have tampered with. By skimming the card, crims can download your account details and use these to rack up purchases in your name.

Protect yourself by only handling the card yourself, or at least keep it in sight when paying for purchases. Stick to ATMs in busy, well-lit locations where thieves are less likely to tamper with the machine.

7. Check your card activity regularly

Make a point of checking your card transactions regularly, and review statements thoroughly.

"Card not present" (CNP) fraud, which happens when your card details are stolen and used to make online purchases, accounts for 88% of all card fraud. But you may only become aware of these transactions by checking your account activity.

If you come across any suspicious transactions, contact your card issuer immediately.

Consumers who have taken steps to protect their card are not liable for fraudulent transactions. In cases where fraud has occurred, the card issuer will reimburse you for the transaction, cancel your card and issue a new one. It may mean the inconvenience of being without your card for a week or two, but it prevents a minor fraud becoming a major hassle.

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A former Chartered Accountant, Nicola Field has been a regular contributor to Money for 20 years, and writes on personal finance issues for some of Australia's largest financial institutions. She is the author of Investing in Your Child's Future and Baby or Bust, and has collaborated with Paul Clitheroe on a variety of projects including radio scripts, newspaper columns, and several books.
Mary Fernando
May 27, 2021 5.57pm

Why is it companies appearing online offering services but regularly fail to provide anything. But many times I found it was more of free subscription to their bank account. The trader continues to take money out of my Credit Card despite not agreeing to further use of their services. One example when I contacted a site offering to locate a phone number in the UK. I failed to provide the info but the site repeatedly took out money form my Credit Card. When I looked closely later at their site it states that money will continue to bt taken until such time I put a stop. I did not sign up to donate monthly to their account. Then I have go through the process of going to my Bank and lodge a Dispute. I have had 3 occasions this happened. How can this be allowed? On checking reviews most stated the site was a Scam.