Jelani Smith
Credit cards have greatly changed the way we deal with our personal finances. Many people use credit cards only for purchases for the two main benefits: rewards, and keeping track of your budget.
On the other end, there have been incidents of credit card frauds. This is where your credit card information is stolen, in order for the thefts to make unauthorized purchases. Fraudsters typically ‘skim’ credit cards at merchants. In other words; they would obtain credit card information, and sometimes even sell it to third parties.
Signs of Credit Card Fraud
Lower Credit Score
If you check your credit score regularly, you may notice an unusual change. Higher balances on your credit cards, or loans taken out under your name would negatively affect your utilization ratio and downgrade your credit score.
Higher than average balance
Typically, you should have a rough idea of what your monthly balance should be. If you notice it’s significantly higher than your estimated spending, this is a red flag. I highly recommend to set some time aside, and go through your credit card statement, rather than just paying your balance. Depending on your financial institution, the unauthorized transaction must be reported within a certain number of days.
Suspicious Transactions
Sometimes you may end up making a purchase at a ‘sketchy’ merchant that is not reputable. It’s recommended to purchase from reputable merchants. If you feel that something has been sketchy – just continue to monitor your credit card statements and your credit score. However, to avoid any possible frauds, you can also call your credit card company and request for a replacement card (with a new number).
Fraudulent Emails
We all have received those ‘spammy’ emails. Those emails that prompt us to enter our personal information, such as bank accounts, credit cards, etc. The email may be something along the line of “your bank account has been hacked, click here to change your password.” Never click the link in these types of emails. The only place you should ever be giving personal finance information is when you’re making purchases at reputable merchants, and when signing in on online banking.
If you have opened the link/provided your personal information before on one of these emails, I highly recommend you to check your credit score/report, and to check your credit card statements, to ensure that there has been no unauthorized transactions. In this case, you should also call your credit card company and request for a new card number as well.
Bottom Line
In case of a credit card scam, report to your credit card company and a major credit bureau as soon as possible. Inform them about the unauthorized transaction, and do it as soon as possible, so your credit score doesn’t take a huge hit. I highly recommend setting up mobile alerts on your profile – this a feature that many financial institutions offer. That way, you would be able to keep an eye out for any unusual transactions, and stay on top of your finances.
