Protecting Yourself Against Credit Card Fraud (Part 1)

Credit cards are a big reason why Singaporeans have so much purchasing power. After all, most credit card companies give you a credit limit that’s 3X to 4X your monthly income – and some, like the American Express Platinum card – have no pre-set spending limit at all.

Now multiply that credit limit by the number of credit cards you have right now – depending on what kind of plastic you’re carrying, you’re easily walking around with $20,000+ to $60,000+ in your wallet!

Now just imagine for a minute what could happen if someone got a hold your credit card(s) or your credit card account information – that person would have $20,000+ to $60,000+ from your credit line to spend!

That’s what credit card fraud is – it’s when someone uses your card or card information to make unauthorized transaction, and it’s a growing problem not just in Singapore, but all over the world.

Fortunately, there are measures you can take to prevent that from happening.


Credit Card Fraud Prevention Do’s

The only way to prevent credit card fraud is to be vigilant – there’s no way around it. Keeping a close eye on your cards (physically) and on your credit card activity is the easiest way to ensure that any financial funny business doesn’t go unnoticed.

After all, the last thing you want is to be lining up at the grocery store or at your favourite retail shop to pay for your purchase only to find out your credit card was declined because *shock* you went over your credit limit.

Except that it wasn’t “you” that went over your credit limit – but a fraudster using your card!

Here are the credit card fraud prevention do’s you must be aware of:


Go Paperless with Your Credit Card Statement(s)

Do you still receive paper statements from your credit card issuer? Well, aside from the fact that you’re probably being charged a fee for receiving a paper statement – you’re also putting yourself at greater risk for credit card fraud.

It doesn’t matter whether a fraudster gets a hold of your statement(s) by stealing your mail or going through the trash. What matters is how fraudsters will use your statement(s) – to dig up enough of your credit card details to make unauthorized purchases.

Instead, take the paperless route by requesting that your statement be delivered electronically. That way, you can eliminate the possibility of someone rummaging through your garbage or mailbox.


Monitor Your Credit Card Statement(s) Closely

If you file away your credit card statements without reading them, throw them away (hopefully after shredding them) or check your online credit card account once every month or two – there’s a greater chance that you won’t catch credit card

Ideally, you’ll want to hold onto every receipt you make with your credit card and match it up against the transactions appearing on your statement to ensure that: A) no one’s making unauthorised purchases with your credit card(s) and, B) you’re not being overcharged by retailers.

By checking your credit card statements regularly, you can  any suspicious charges made with your card so you can notify your credit card issuer to immediately dispute them.


Make Use of Credit Card Account “Alerts”

Do you ever sit at your work desk wishing you could be somewhere else? We all do that. But when your credit card happens to be used in China or the United states and you’re still sitting around in Singapore – it’s a big hint that your credit card has been compromised.

Remember, credit card fraud is an international crime that can be committed from anywhere.

Thankfully, many credit cards offer “alarms” that send you an SMS or email whenever a charge over a certain amount is made (or an overseas purchase is made). Some credit cards even provide alerts that send you an SMS/email alert for every charge made on your card.

Alerts are great because they give you time to call up the credit card issuer and dispute any suspicious charges made to your card.


Monitor All Physical Credit Card Transactions

Any time you give your credit card to someone to pay for your meals, drinks or any other purchases really – make sure you monitor exactly what that person does with your card.

The reality is that there are plenty of ways to become a victim of fraud once you hand over your credit card, but the worst is through skimming. That’s because skimming basically allows fraudsters to “steal” your credit card – without physically needing to steal it!

With a skimming machine, all a fraudster needs to do is swipe your card on the device’s card reader to obtain your credit card information. And once they have that, all a fraudster needs to do is reprint a counterfeit card using your card’s data to make unauthorized purchases.

This type of credit card fraud is especially common at bars and restaurants. That’s because it’s easier for an employee to inconspicuously skim your card’s data while you’re still engaged with company.

Be especially wary of credit card fraud when travelling abroad as credit card scams (especially credit card “skimming”) are becoming increasingly common. And remember, keep an eye on whether your card is being swiped twice, because that first or second machine might actually be a skimmer!


Contact Your Credit Card Issuer if Your Card Goes Missing (or is Stolen)

Keeping an eye on your credit cards, both physically and by monitoring the transaction activity on your statements or online accounts, is the easiest way to know whether your card is lost or stolen. After all, if you look at the tips above, a fraudster doesn’t need to physically “steal” your cards to make unauthorised purchases with them!

But the easiest way to become LIABLE for someone else’s fraudulent purchases is to ignore your credit card activity! Unauthorised purchases don’t need to be in the thousands. Some fraudsters intentionally make smaller purchases on credit cards with large credit limits so that it’s easier to “slip by” inattentive card users.

So make sure you actively scrutinise credit card transactions on your account and if you notice your card is “stolen” or missing – inform your credit card issuer immediately!

If your card is stolen or missing, the most you’re liable for is $100 – of course, that’s only if the credit card issuer determines that you didn’t act fraudulently, were “grossly” negligent or failed to inform it in a timely manner (the time limit varies by credit card issuer).