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CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Credit Card Fraud
An Educational Partnership of Consumer Action and Chase
©2009
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Overview of Topics
•Recognizing types of Credit Card Fraud•Protecting yourself from fraud•Steps to take when fraud strikes•Resources & referrals
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Credit Card Fraud
• Unauthorized charges to your credit card
• Counterfeit cards
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Credit card fraud can occur when
• cards are lost or stolen• mail is diverted by criminals• employees of a business steal
customer information
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Why does credit card fraud matter?
• The Federal Trade Commission estimates that 10 million people are victimized by credit card theft each year
• Credit card companies lose close to $50 billion dollars per year because of fraud
• These costs “trickle down” in higher interest rates and fees for all consumers
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
The bottom line...
• All cardholders pay for credit card fraud losses– Victims spend time and money to
repair the damage– Credit card issuers charge higher
fees and interest rates to cover their losses
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
ID Theft
• Identity theft is the use of someone’s personal information, such as their Social Security number or date of birth, to commit financial fraud
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
ID thieves harmvictims by:
• using their names and other personal information to open new credit accounts
• accessing existing credit and bank accounts to make unauthorized purchases
• Victims of ID theft are not held liable for losses, but it takes time and effort for victims to prove fraud and clean up the chaos
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Forms of Fraud
• Dumpster Diving– Stealing credit card information
from discarded receipts or account statements in people’s trash
– Shred unwanted documents that contain Social Security numbers, bank and credit card information and other sensitive financial information
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Skimming
• When dishonest employees make illegal copies of credit or debit cards using a “skimmer” device that captures credit card numbers and other account information– The stolen credit information is
used to make purchases by phone and internet, or to make counterfeit cards
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Phishing
• Phishing is a financial crime that starts with massive numbers of deceptive spam e-mails– These e-mails look like they come
from your bank– But they are just a trick to get
account numbers and passwords
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Security Codes
• Credit card companies use security codes to help prevent unauthorized or fraudulent use by phone and online – These numbers help ensure that
you have the card — not just the account number
• Merchants are prohibited from keeping or storing any security codes after transactions are completed
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Security Codes
• Security codes for Visa, MasterCard and Discover cards are the 3 digits located on the back of the card in the signature box.
• Security codes for American Express are 4 digits long, printed on the front of the card above the right side of the main credit card number.
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
New Cards
• For added protection, credit card issuers ask you to call from home to activate new credit cards
• As soon as you receive your new card, sign the back of it with a permanent black ink pen
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Should you write “Ask for ID”?
• Writing “Ask for ID” in the signature space may not be a good idea as your transactions might not go through if the card isn’t signed
• Consider signing your card and also writing “Ask for ID”
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
In case your card is lost or stolen
• Record all your account numbers and company contact information and keep the record in a secure place
• That way you can easily find whom to call to report the loss
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Protect your PIN
• Never write down your personal identification number (PIN)
• Never give your PIN to anyone
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Protect your account numbers
• Never write your credit card number on post cards or on the outside of envelopes
• Never provide your card number on the phone, unless you know it’s a legitimate, reputable business
• Never give your account number to anyone who calls you on the phone or sends you an e-mail
• If you let others use your card, you are responsible for charges
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Billing Statements
• Review credit card statements closely on the day they arrive– Report any questionable charges to
your card issuer immediately• A missing credit card statement may
indicate stolen mail– Contact your card issuer right away
if your bill doesn’t arrive around the usual date
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Online account access
• If you have a computer, consider signing up for online account access
• This way you can track your account activity between statements
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Liability
• Fraud victims are not generally required to pay for unauthorized charges
• Victims may be liable for up to $50 of the loss, depending on the circumstances
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Protect your wallet or purse
• Keep a close eye on your belongings• Never carry all your credit cards• Bring only the 1 or 2 cards you might
need• Carry your credit cards separate from
your wallet• If your wallet or purse is lost or
stolen, call your credit card issuers immediately
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Watch your credit card
• Watch closely when store or restaurant employees handle your card to make sure they are not copying or “Skimming” your credit card number
• After you make a purchase and your card is handed back to you, make sure the card is yours.
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Take precautions
• Notify your credit card company if you are going to be traveling away from home to prevent any inconvenience if your issuer should block your account from being used in a different city
• Notify your credit card company if you are going to make any unusually large purchases so that your account is not flagged for possible fraud
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Safeguard your mail
• Notify the post office and your credit card company immediately if you change your address
• Lock your mailbox. Never leave mail in an unlocked mail box or apartment building lobby
• Put your return address on out-going mail
• Shred unwanted credit card solicitations before discarding
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Internet Safeguards
• If you bank online, don’t use “automatic sign on” for bank or credit card sites
• Avoid providing your credit card number to websites offering “free access”
• Install a firewall in your computer to prevent unauthorized access from hackers
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Reporting creditcard fraud
• To report credit card fraud– Call your card company
immediately about• Lost or stolen cards or PIN numbers• Unauthorized charges on your
statement
– Request a fraud affidavit– Get a police report if necessary
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
The Fair Credit Billing Act
• is a federal law that gives you the right to resolve billing errors, including unauthorized charges– If something goes wrong, you have the
right to dispute the charge– To dispute billing errors on your
statement, contact your card issuer within 60 days from the statement date or you lose your right to file a dispute
• Note: There is no time limit for reporting fraudulent charges.
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Disputing charges
• Always dispute billing errors in writing. You can call your card company and follow up with a letter.– Describe the dispute in a few
sentences– Send it to the correct address for
billing disputes – Do not include your dispute letter
with your bill payment
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Free Credit Reports
• Online:www.annualcreditreport.com
• Phone:1-877-322-8228
• By mail:Annual Credit ReportP.O. Box 105281 Atlanta, GA 30348-5281
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Federal Trade Commission (FTC)
• The FTC offers free publications on credit cards, billing rights and how to avoid credit card fraud
www.ftc.gov/consumer
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
The National Fraud Information Center
• The National Fraud Information Center, a project of the National Consumers League, offers advice and prevention tips
www.fraud.org1-800-867-7060
CONSUMER ACTION - Credit Card Fraud Trainingwww.consumer-action.org
Your State Attorney General’s Office
• The National Association of Attorney General web sitewww.naag.org
• Check the phone directory to find your state office
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