Don’t let this credit card fraud nightmare happen to you

Credit card fraud has been increasing in recent years.

The Federal Trade Commission’s most recent database indicates that 416,582 cases of credit card fraud were reported in 2024, making it one of the most common forms of identity theft. You know you’ve been a victim of this scam when you notice unauthorized transactions on your credit card account.

These transactions are usually under $100 to avoid detection. However, they can sometimes exceed $1,000. One such incident occurred with Martin from Martinsville, Virginia, when he was randomly charged $1,095 in Hong Kong.

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“Hello, I recently received a Fraud alert From my credit card company saying they are charging $1,095 to my credit card in Hong Kong. I use my iPad and Safari browser to shop online. Could you please explain how this could happen? By the way, my credit card company canceled my credit card and will send me a new mastercard in the mail, and I am not responsible for my credit card charges. What can I do in the future to prevent this from happening again? “

Sorry to hear about the fraudulent charge on your credit card, Martin. The good thing is that your credit card company handles it and you are not responsible for the charges. For future reference I will discuss how this could have happened and how to stay safe.

How credit card fraud happens

Credit card fraud can happen in several ways, often without you even realizing it. One common method is when fraudsters obtain your card information data breach In online shops or banks, which means your details are leaked without your knowledge.

Another low-key tactic is phishingwhere fraudsters trick you into giving out card details by posing as legitimate companies via e-mail or fake websites.

There is also the risk of “skimming“where machines at ATMs or gas stations secretly record card details when you swipe it. In some cases, fraudsters can also take advantage of weak security public wi-fi networks or compromised apps to access your data while shopping online.

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Credit card fraud is all too common

A report from security.org reveals this 52 million Americans will experience credit card fraud in 2023a figure even higher than that reported by the FTC. With four out of five American adults owning at least one credit card, the report found that three out of five cardholders have faced unauthorized charges – about 128 million victims. What’s more, 75% of those victims reported having their credit card information stolen more than once.

A typical unauthorized transaction is around $100, which amounts to approximately $5 billion in criminal purchases each year. Interestingly, the majority of unauthorized transactions involve credit cards that have not been physically lost or stolen, highlighting the growing risks of online fraud and data breaches.

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The need for identity theft protection

Data breaches are one of the main ways credit card fraud occurs. Hackers often become unauthorized Access to sensitive information stored by companies or institutions. When a retailer, financial institution or online store experiences a data breach, hackers typically go after the payment systems that store the customer’s credit card details.

If these systems aren’t properly secured, hackers can grab things like credit card numbers, expiration dates, and sometimes even security codes. Once they have that information, they can either use it themselves or sell it to others.

But it’s not just credit card information. Data breach It can also expose personal information such as names, e-mail addresses and phone numbers. Fraudsters can then use this stolen data to launch phishing attacks, pretending to be trusted companies and tricking you into providing more sensitive information.

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This is why identity theft monitoring is so important. Phishing companies can monitor personal information like your Social Security number, phone number, and email address and alert you if it’s being sold on the Dark Web or used to open an account. They can also help you freeze bank accounts and credit cards to prevent further unauthorized use by criminals.

One of the best parts about some identity theft protection services is that they have identity theft insurance up to $1 million to cover losses and legal fees and a white-glove fraud resolution team, where a US case manager helps you recover any losses. Check out my tips and top picks to protect yourself from identity theft.

How to fight back against debit card hackers who are after your money

10 ways to protect yourself from credit card fraud

1. Notify your credit card issuer immediately: If you notice fraudulent charges on your credit card, start by calling the number on the back of your credit card. From there you should get more detailed information on what to do next.

2. Monitor your statements regularly: One of the best ways to catch credit card fraud early is to keep an eye on your statements. Review your transactions regularly to spot any unknown charges. The sooner you notice something suspicious, the sooner you can report it to your credit card company and prevent further damage.

3. Check your credit report regularly: In addition to monitoring credit card statements, periodically review your credit report to catch unauthorized accounts opened in your name.

4. Use strong, unique passwords: Always use strong, unique passwords for your online accounts, especially those that store payment details. Avoid using information that is easy to guess and consider using a password manager for storing and generating secure passwords. This reduces the chances of fraudsters accessing your accounts.

5. Use credit card alerts: Set up alerts about transactions with your credit card company. This way, you will receive a notification via email or text for every transaction made with your card. If you receive an alert for a purchase you didn’t make, you can take immediate action to report it and prevent further charges.

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6. Be careful with public Wi-Fi: Avoid making purchases or entering sensitive information when connected public wi-fi Networks because they are often not secure. If you need to make online purchases while on the go, consider using a VPN (virtual private network) to encrypt your connection and keep your credit card information safe from hackers. For the best VPN software, see my expert review of the best VPNs for private browsing on your Windows, Mac, Android, and iOS devices

7. Do not store credit card information on browsers and websites: Saving your credit card information on browsers or websites may make it convenient, but it also puts you at greater risk of fraud. If your browser or website security becomes compromised, hackers could access your saved card details. To stay safe, avoid saving your credit card information and enter it manually every time you make a purchase. If a website offers to save your details for future use, think twice before accepting. It’s better to take the extra step of entering your information each time, ensuring your information stays safe.

8. Use EMV Chip Technology: Always use a chip reader instead of swiping a card when making a personal purchase. CHIP technology provides an additional layer of security against fraud.

9. Be wary of unsolicited emails, texts or phone calls asking for your credit card information. Legitimate companies typically do not request sensitive data through these channels. The best way to protect yourself from malicious links that install malware, potentially accessing private data, is to install antivirus software on all your devices. This protection can also alert you to phishing emails and ransomware scams, keeping your personal information and digital assets safe. Get my picks for the best antivirus protection 2025 winners for your Windows, Mac, Android and iOS devices.

10. Keep the card in sight: When using your card in restaurants or shops, try to keep it in the frame. This reduces the risk of someone copying your card details.

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Kurt’s key step

It’s clear that credit card fraud is more prevalent than ever, affecting millions of Americans each year. The good news is that there are effective steps you can take to protect yourself from becoming a victim. By being vigilant and using best practices – like monitoring your statements and using strong passwords – you can significantly reduce your risk. Remember, awareness and proactive measures are your best defense against credit card fraud.

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