Credit card fraud should be a concern for anyone who owns a credit card.
This useful guide provides handy tips and tricks to keep your cards and your personal information safe.
What is credit card fraud?
Credit card fraud is an umbrella term, which is used to describe fraudulent activity relating to the use of credit cards.
The most common types of fraud include stolen cards and identity theft.
As technology advances, threats evolve.
Modern-day consumers should be aware of the risks involved when using credit cards to make purchases both in-store and online.
In years gone by, the only worry was having your card pinched out of your pocket or your wallet swiped.
Today, we have to be wary of cybercrime and innovative, sophisticated techniques that are used to obtain sensitive data to make payments without necessarily having access to a physical card.
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Many of us will be familiar with the sinking feeling you get when you can’t find your wallet, or you go to pay for something and your card isn’t where it should be.
If you’ve retraced your steps, you’ve looked high and low and you still can’t find your credit card, there is a chance that it might have been stolen.
Missing cards can fall into the wrong hands, and this is why it’s crucial to take swift action.
If you suspect that your card has been stolen, contact the card issuer immediately.
You can cancel your card and arrange for a new one to be sent out to you.
Your card issuer will be able to tell you if the card has been used since you last knowingly had it in your possession.
If payments have been made, and you were not responsible for them, you can follow this up with your bank.
Financial organisations are clued up to threats and risks, and often, they will block payments that seem unusual, for example, transactions in a different country.
Identity theft is an evolving crime, which has proliferated due to the rise of the Internet and the popularity of online shopping.
With identity theft, thieves are looking to steal your personal information, rather than the physical card.
Details like your full name, your address, your date of birth and your SIN (social insurance number) can be incredibly valuable for people looking to make money through fraudulent means.
If you notice anything suspicious, or you’re worried that somebody might have got hold of your personal details, don’t hesitate to contact your card issuer.
You may find that you get a call from your bank if somebody has tried to use the card.
How common is credit card fraud in Canada?
Statistics suggest that around 90% of Canadian households have at least one credit card.
Research conducted by The Bank of Canada revealed that the average Canadian had two credit cards in 2017.
Credit card fraud is relatively uncommon in Canada, yet figures from the Canadian Bankers’ Association claim that criminal activity accounts for losses of over $800 million per year.
Statistics from CPA Canada show that 19% of Canadians know that they have been victims of credit card fraud.
Almost 40% of credit card owners are reluctant to use their cards in certain stores due to security worries.
Identity theft is becoming more commonplace in Canada.
The rate of identity theft crimes has risen from 7.12 per 100,000 residents in 2015 to 10.11 per 100,000 residents in 2018.
How to prevent credit card fraud
It may not always be possible to prevent credit card fraud, but there are several steps you can take to lower the risks.
- Keeping your card in a safe place: try and avoid leaving your credit cards lying around or walking around with your wallet in an easily accessible location, for example, an open bag or a back pocket. Take extra care when using public transport and visiting tourist hot spots. It’s best to keep your purse or wallet in a closed bag or to use a money belt;
- Keeping your SIN safe. Your SIN can be used by thieves, so avoid keeping it in your wallet. Store it in a safe place. You can use your driver’s license, a care card or a bank card to verify your identity in most cases, so leave your SIN at home;
- Checking your wallet: if you tend to go for days or weeks without using your credit card, keep checking your wallet to make sure that it is still there. If your card is stolen, it’s critical to report it missing as soon as possible;
- Shredding credit card statements and cutting up old cards that have expired;
- Signing new debit and credit cards;
- Choosing a PIN that is hard to guess. Many providers now prohibit users from selecting birthdays and number sequences like 1,2,3,4, for example. It’s best to think of a PIN that would be difficult for a thief to guess;
- Never give your credit card or personal details to anyone who asks for it over the telephone without verifying that they are who they say they are. If you’re paying for an order or a hotel room, for example, look for the contact details on the business website, make the call and ensure the line is secure. Take great care if you take a call and you are asked to provide your details. Look out for spam emails, text messages and calls. There are some very good copies out there that look like genuine messages from retailers and banks. Avoid responding to texts or clicking on links in emails. If you’re unsure whether to trust an email or a text, check with your bank first;
- Always ensure that your connection is secure when banking or buying products online. Try and avoid public networks and make sure the site is protected. You should be able to see a padlock in the top corner;
- Keeping an eye on your statements and checking your balance frequently. If you notice any payments that you haven’t made, contact your card issuer straight away.
Credit card fraud is not rife in Canada, but it is important to be aware of the risks and to seek advice if you lose your card or your card has been used by another person.
If you have any questions or concerns about credit cards, we’re here to help.