April 30, 2006
Protecting Yourself against Credit Card Fraud
Credit card security is one issue both credit card companies and their customers are concerned about. Since their introduction, credit cards have changed the way we pay for goods and services. It is estimated that three out of every four adults use at least one credit card. In fact, on average, adult Canadians have four credit or charge cards. With so many cards in existence, misuse is a significant risk, and statistics show that credit card crime is growing.
Many credit card companies offer you protection in the event your card is lost or stolen and used fraudulently. The option for "limited liability" for unauthorized use of the card must usually be requested (unless you have a really heads-up salesperson), and the protection is only valid when a lost or stolen card is reported immediately. If you follow the rules, your liability is usually limited to a maximum of only $50. Take advantage of this limited liability protection, and remember to report lost or stolen cards immediately.
Don't leave your credit cards in high-risk theft areas such as your workplace, in the glove compartment of your car, sitting out in the open while on public transportation, or in health clubs and hospitals. If your card is lost or stolen, report it immediately. Since most lost or stolen cards are fraudulently used immediately after they are stolen, prompt reporting can make a big difference. The telephone number for reporting lost or stolen cards is usually provided on the back of your credit card statement.
Don't keep your PIN (personal identification number) with your credit cards. The "limited liability" protection mentioned earlier is not extended to cash advances — even those that are fraudulent. Protect yourself. No one should have access to your PIN but you.
Be very careful about giving out your credit card number over the telephone. Phony companies calling to solicit travel business or sell products may encourage you to give them your credit card number. Later, you may find that your account has been charged for products or services you neither requested nor received. While there are many legitimate telemarketing companies and survey companies, you should only give the number out when the organization is known to you and the product or service is one you have requested.
Whenever you use your card, keep your copy of the receipt so that you have an actual record of the transaction. Tear up your carbons so someone rustling through the garbage won't find your name, number and signature. Put some sort of identifying mark on your card. Sometimes cards get mixed up by busy sales clerks. If your card has a distinctive mark (borrow a sticker from one of your kids), you'll be able to instantly recognize it.
Take a photocopy of all your credit cards so you have a record of all the details of your cards if they are lost or stolen. Remember to keep those records in a safe place.
And finally, when your card expires and you get a replacement card in the mail, cut up your old card. Don't just cut it in half; cut it along the numbers, and chop it into small pieces. The likelihood of anyone finding all the pieces is much smaller that way.