Part II: Credit Card Fraud & Security
Credit card fraud now costs UK credit card provider millions of pounds each year. The problem is huge and growing. As such, credit card companies are now taking steps to combat the level of fraud that is taking place. The following is a look at some of the primary ways in which the fraud is being committed and also a look at how the credit card providers are fighting back against credit card fraud.
Personal Identity Theft
Last year alone fraud cost the UK credit card business over £1billion – and it is estimated that identity theft accounted for approximately 10% of that sum! While you may well not be held responsible by your credit card provider for fraudulent transactions made on your card, if the credit card provider is of the opinion that you contributed in any way to the theft of your personal information. As such, to ensure that you are not held accountable for any theft of your personal information, you should ensure that:
- when you use your credit card you never let the card out of your sight
- if the outlet where you use your card uses the old carbon-copy paper system, take the carbon-copy with you and destroy it at a later date in a safe place
- never use your credit card on an unsecured website
- never use your credit card to withdraw money at an ATM that you have not previously used
- never throw your rubbish out if you have not shredded all of the information so that it cannot be read in any useful way
- treat all mail as confidential – and if you do not receive mail you are expecting, such as a credit card statement, inform your credit card company immediately that you think something may be amiss.
Fraud Prevention Tactics
In addition, fighting back against credit card fraud, UK credit card providers have started to incorporate some (if not all) of the following credit card fraud preventive measures:
- identification photos on your credit cards;
- fingerprints on your credit cards
- chip and Pin systems whereby the card has an encrypted chip containing details about the card and a PIN that ensures the card is being used by the genuine user
- Insurance
A great number of UK credit card providers now offer their cardholders the chance to insure themselves against any potential fraudulent use free of charge, or at a percentage of the then outstanding balance. Given the level of credit card fraud currently taking place in the UK, it is highly recommended that you consider taking your credit card provider up on this offer if you think there is even a remote chance you may be faced with a bill for any fraudulent transaction made on your credit card. To determine the chances of this happening, you need to review the terms and conditions of the issue of your UK credit card carefully.
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