Suspect Credit Card Fraud? Here are 5 Steps to Immediately Take

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If your credit card has been lost or stolen, or you notice any unauthorized charges on your monthly statement, you’ll need to act fast as you may be the victim of credit card fraud. Once your account has been compromised, quickly gather as much of your personal information as you can – account numbers, social security number, bank logins, passwords, etc. – it’s time for damage control. If you find yourself in this stressful situation, as calmly and swiftly as possible, consider these 5 steps to take immediately after credit card fraud.

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Common Types of Credit Card Fraud

Credit card fraud can occur in several ways. Here are the four most common types:

Types Explained
Application fraud Application fraud is the obtaining of a credit card through fraudulent means. Criminals can steal information like your name, contact info, or Social Security Number to apply for a credit card using your details. Application fraud is more dangerous for your credit score than your wallet, as any fraudulently made charges are easily disputable.
Card not present (CNP) fraud Card not present fraud is one of the most common types of credit card fraud because your credit card doesn’t have to be physically present. Scammers often use phishing scams to trawl and hunt for personal information – including your credit card details. This information is then used to make online purchases using your account details.
Skimmers Credit card skimming involves the reading of your secure banking details using a device that steals information from the magnetic strip from the back of your card. These skimming devices are usually found on ATMs, at gas stations, or poorly-monitored sales kiosks and other locations.
Account takeover An account takeover occurs when a thief steals personal information (through skimmers or other methods) and then uses that information to update other critical account information (usually your PIN) and take over the account.

There are, however, more ways in which fraud can take place. If your card is lost or stolen, it can be misused by someone else, for example. They might use it until the card is reported missing, resulting in a negative impact to your credit score (and a hefty hit to your wallet, too). Friendly fraud is another type of credit card fraud, where the accountholder requests a chargeback for an item they purchased but later claimed was unauthorized. You are very unlikely to be a victim of your own fraud and immediately seek to fix it.

Steps to Take After Credit Card Fraud

If you suspect you are the victim of credit card fraud, here are five steps to follow immediately:

1. Contact Your Credit Card Issuer ASAP

Your first course of action should always be to contact your bank or credit card issuer. It cannot be stressed enough how important it is to call your credit card company once you realize that fraudulent charges have been made using your credit card. The phone number to contact your card issuer can normally be found on the back of your card, but since it’s lost or stolen, in this case, you can find that number on the issuer’s website. Once you inform your issuer of the situation, ask them to put a security freeze on your credit card account to prevent further damage until the new card they issued you arrives.

2. Issue Fraud Alerts and Report Identity Theft

After informing your credit card issuer about fraudulent activity on your credit card account, the next step to take is to contact one of the three major credit bureaus (Equifax, Experian, or TransUnion) and ask them to put a security freeze on your credit report as well. Also known as credit freezes, this prevents others from accessing your credit file and potentially sinking your credit score by opening multiple new accounts, performing numerous balance transfers, and making purchases in your name without permission.

You should also notify the Federal Trade Commission of what’s going on and ask them to file an Identity Theft Affidavit. Consumers can report identity theft at IdentityTheft.gov, the federal government’s one-stop resource to help people report and recover from identity theft. You should then contact your local law enforcement to file a police report, just in case – you can never be too safe.

3. Update Your Passwords and Verify Account Info Everywhere

Your credit accounts aren’t the only things that can be affected when you notice credit card fraud. There’s a good likelihood that your debit card may also be compromised, so after notifying the proper authorities, it’s time to update the logins to your pertinent financial accounts. Through your bank’s smartphone app or website, update your password if it hasn’t already been changed. Make sure you do not use the same password and do not use a password that you use elsewhere.

If you do either of those things and an unsavory character already has access to one of your accounts, they’ll have access to all of them. While logging into your bank account, check your credit statement to see if any unauthorized charges have been made that you’ve not noticed and immediately report any more suspicious activity.

This is also a good time to verify all of the personal information you have listed in your account profile and create alerts that will notify you via smartphone, email, or other means of any charges made using your debit cards or credit cards. It may seem overwhelming initially, but these notifications keep you keenly aware of everything going on with your accounts (based on parameters you set) and can help create awareness of your spending habits – a key component of household budget planning.

4. Update Recurring Payment Methods

Victims of identity theft may not think of it at first, but putting security freezes on compromised credit cards normally used to make recurring payments can disrupt their monthly payment cycles. If you know your card will be charged on the first of the month to cover a phone bill or utility payment, you wouldn’t want those services accidentally interrupted just because someone stole your credit card.

In changing the payment methods for these recurring charges, you may find a few subscription services you no longer use and can cancel to put a few bucks back in your pocket.

5. Monitor Everything

With your mind on your money and your money on your mind following credit card fraud, you should also take the time to improve your security habits.

As mentioned throughout the article, be sure to comb through your credit card and debit card statements, check your credit report, and update passwords for all your accounts. While you’re at it, run antivirus programs on all of your internet-enabled devices just to be sure.

Credit card fraud can affect you when you least suspect it, but acting fast and methodically by following some of the tips above can go a long way in helping you get back on your feet before you know it.

Conclusion

Anyone can be a victim of fraud – but no one needs to lose sleep over being a victim of it. There are practical steps you can follow to quickly and safely report fraud to the police, government agencies, and major credit reporting agencies. By staying calm and following best practices, you can ensure you remain safe from major financial and credit health threats. 

Related Article: Here’s How to Dispute Errors on a Credit Report

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About: Cory Santos
Cory Santos

Cory is the senior credit card editor at BestCards, specializing in everything credit card-related. He’s worked extensively with credit cards and other personal finance topics, including nearly five years at BestCards. Cory’s extensive knowledge is an essential part of the BestCards experience, helping readers to live their best financial lives with up-to-date insights and comprehensive coverage of all facets of the credit card space, including market trends, rewards guides, credit advice, and comprehensive credit card reviews.

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