The 5 Most Common Types of Credit Card Fraud and How To Prevent Them
If you’re like most people, you probably have at least one credit card. And if you’re like most people, you may not know very much about credit card fraud at all. Credit card fraud can take many different forms, but some of the most common types are described below. Knowing how to prevent these types of fraud can help protect you and your finances.
1: Credit card skimming
Skimming is a type of credit card fraud that involves stealing information from your credit card’s magnetic stripe. This information can then be used to create counterfeit cards or to make fraudulent purchases online. To protect yourself from skimming, always keep an eye on your credit card when it’s being used and never let it out of your sight. If you notice anything suspicious, such as someone fiddling with the credit card machine, don’t hesitate to speak up.
2: Credit card cloning
Credit card cloning is a type of fraud that involves copying information from a credit card’s magnetic stripe in order to create a counterfeit card. This type of fraud is often used to make fraudulent purchases online or to withdraw money from ATMs. To protect yourself from credit card cloning, always keep your credit card in a safe place and never let it out of your sight. Also, be sure to check your credit card statement for any unauthorized charges.
3: Credit card phishing
Phishing is a type of fraud that involves sending fraudulent emails or text messages in order to steal personal information, such as your credit card number and password. These emails and text messages often look like they’re from legitimate companies, such as your bank or credit card issuer. To protect yourself from phishing scams, never respond to any unsolicited emails or text messages, and never provide any personal information, such as your credit card number or password. Also, be sure to check the legitimacy of any email or text message by contacting the company it claims to be from.
4: Chargeback fraud
This type of fraud commonly targets businesses, rather than consumers. It occurs when a criminal charges items to a business’s credit card and then requests a chargeback, or refund, for those items. This can be a difficult type of fraud for businesses to detect, as criminals often use fake or stolen identities.
To protect your business from chargeback fraud, always verify the legitimacy of any credit card charges and be sure to contact the credit card issuer if you suspect any fraudulent activity. Additionally, consider using a merchant fraud protection service to help protect your business from this type of fraud. For example, Ethoca chargeback services are a good option for many.
5: Credit card application fraud
This type of fraud occurs when someone uses false information to apply for a credit card. This type of fraud can be difficult to detect, as criminals often use fake or stolen identities. To protect yourself from credit card application fraud, always be sure to review your credit report for any unauthorized accounts or inquiries.