Experts Warn Against Credit Card Theft

Credit industry specialists are telling cardholders to be extra cautious when using their credit cards especially with some states reporting an increase in suspected card fraud incidents. The prevalence of plastic and the bad economy is generating suitable conditions for scam artists to defraud millions of Americans billions of dollars each year, experts say.

Card companies have also reported mounting losses due to credit card frauds. Analysts say that if criminal activities like these continue, consumers can end up having unauthorized purchases worth thousands of dollars charged to their cards. If left untended, incidents of card fraud and theft can adversely affect credit scores and ratings. This can then result in consumers being denied access to other financial options like loans and extended credit.

Experts say that the first and best line of defense against card theft is the cardholder himself. They recommend checking monthly card statements regularly and methodically to determine if there are suspicious entries like items or services consumers may not remember buying or paying for. These are often telltale signs of credit card fraud. Federal Trade Commission Attorney Nur al Haq explains that cardholders should be on the lookout for irregular activities recorded in their monthly statements.

Consumers should immediately contact their card companies as well as the three credit bureaus once they suspect possible credit card fraud. Cardholders should also contact their card issuers if they believe that their credit card information have been compromised. Analysts say that most scam artists report lost credit cards and use the real cardholders’ personal information to get replacement cards. They add that keeping personal data safe is essential to avoid becoming victims of fraud and theft.

Once cardholders report suspected fraud to the credit agencies, the consumers’ credit reports are then “frozen” for 90 days. This means that no one can use the victims’ credit cards without their permission or prior consent.

Americans also do not have to worry about asking the credit bureaus for their credit reports. Reporting a suspected fraud case entitles cardholders to a free credit report in addition to the three yearly reports mandated by law.

Experts also say that consumers need not be worried about being held liable for stolen credit cards or card information. Cardholders will not be held liable for any purchases made using their cards if they report the theft immediately. At most, consumers will only be held liable for $50 once their stolen or compromised cards are used.