Credit card scams to watch out for in 2019
Imagine logging in to your online banking account to check if your credit card payment is already reflected in your profile. You are looking forward to affirming yourself for being a responsible adult and paying your bills on time. To your surprise, instead of seeing a zero in your total amount due, the page says you have reached your credit limit. Scrolling further down, the page reveals a long list of transactions you don’t even remember availing.
You probably would turn red in rage, head straight to the bank and ask for an explanation. This is what credit card owners might have felt in 2016 when around 80,000 fraudulent credit card transactions have been recorded yet not reported to the police. A bank executive disclosed that approximately P507 million were lost in the said transactions on that year.
If you own a credit card or plan to take hold of one, do not fear. The Bangko Sentral ng Pilipinas (BSP) issued a guide for credit card owners to avoid being victims of such scams.
Let us take a look at how credit card fraud is committed and how you can protect yourself from such an act.
1. Theft of the card
The credit card itself is stolen from the owner’s bag or pocket. It is then used as payment mode to buy goods and services in stores accepting credit card transactions. Some are done online in transactions requiring only the credit card number and the card verification value (CVV) written at the back of the card.
In May 2017, the police’s Anti Cybercrime Group arrested a 38-year old man for using a stolen credit card to pay for a mobile phone worth P45,590. Fortunately, the store manager verified the credit card information with the bank. This is their standard operating procedure when the purchase is worth P30,000 and above.
TIP: Call the bank immediately once you notice that your card is stolen so it can block the account right away. According to the Credit Card Association, the credit card owner will still have to pay for the unauthorized purchases made by the perpetrator before the card was reported lost. However, you can still make payment negotiations with your bank. Most banks give leeway once the situation is explained.
2. Information and identity theft
This involves frauds usually representing themselves as a bank representative to obtain vital information such as the owner’s complete name, home address, birthdate and mother’s maiden name. This is done using phone calls.
Sometimes, they introduce themselves as sales representatives offering products which are not easily found in regular stores. They entice the client with a meager price, but the credit card details have to be provided first before they process the transaction.
TIP: It is unsuspecting for a bank representative to ask your personal information in the guise of verifying your account. Unless you initiated the call, do not just give out what is proposed. Check the back of your credit card for the bank’s hotline. Dial the number and ask if the bank has called you. They have call logs in their computers.
Credit card holders fall prey to skimming the way Automated Teller Machine (ATM) card owners do. Wise crooks can place deceiving skimming device in ATMs to capture the data stored in a card’s magnetic stripe. This contains the credit card owner’s name, credit card number and the card’s expiration date. The device can also be placed in other credit card readers.
A small camera is also placed in the booth to record the owner’s PIN. This way, skimmers are able to manufacture fake cards and use the PIN to avail of the cash advance feature of credit cards.
TIP: Wiggle the essential parts of the ATM such as the card reader and keypad. ATMs are built solidly which means if you deliberately shake the abovementioned parts, it should remain in one piece. Also, it helps to wiggle the card while it is being inserted into the machine to avoid skimmers from reading the card. Skimmers require one single motion to study the magnetic stripe. An ATM’s real reader is usually inside the machine.
In the copy paste age, a letter from a bank is easily photoshopped and sent to the credit card owner for criminal intentions. Credit card owners sometimes receive emails believing it is from their bank because the bank’s name appears in the sender column. The bank’s letterhead is also used to make it appear credible. The email asks to verify information such as CVV, online banking username and password.
Aside from emails, BSP said this is also presented via the following:
a. Text messages
b. Chat rooms
c. Fake banner ads
d. Message boards and mailing lists
e. Fake job search sites and job offers
f. Fake browser toolbars
TIP: Look for safety features on the website. A secured site usually has “https://” in the URL bar or a padlock sign found on the right corner of the screen. Check if the company’s spelling is correctly spelt.
Also, make sure that your account’s one-time password (OTP) is enabled. This adds another layer to your security because the banks send a code to your registered mobile number for you to put in before changes or transactions are made in your account.
5. Card replacement scam
Similar to the information and identity theft modus, fraudsters also present themselves here as bank personnel. But instead of achieving this via phone call, that person will ask the credit card holder to physically surrender that latter’s card to be able to avail of an account upgrade. It is, of course, tempting to have a higher credit limit and lifetime freedom from annual fee.
TIP: Shred your old or expired credit cards. The Bangko Sentral ng Pilipinas confirmed that banks would never ask credit card owners to surrender their old credit cards.
The good news is credit cards are now equipped with more secured features to protect you from being a victim of credit card fraud. The signature panel behind your credit card helps the cashier compare your signature to that of an imposter trying to copy your signature. The Europay MasterCard Visa (EMV) chip creates a unique transaction code for every payment, making it hard for fraudsters to duplicate your card.
Banks are also covered by the rules and regulations issued by the BSP to protect clients from fraudulent transactions.
If you are in doubt in what credit card to get because of the thoughts of being scammed, we are here to help you compare and decide which credit card will make you feel most secure.