This is a friendly PSA from someone who’s had his fair share of credit card fraud over the last several years. As a lifelong saver, there was a time I could tell you the balance in my checking and savings accounts right down to the penny. However, in the last year or so, I’ve become lazy — just eye-balling the various balances and think that “seems right.” My lackadaisical approach has largely been driven by the various alerts set on my accounts. I was lulled into thinking I was safe. I was not.
By chance, I reviewed one of my accounts closely this week and noticed numerous small charges I did not recognize. Initially, I started racking my brain, thinking, “Did I make that charge?”
My saving grace were the transactions for Lyft rides. I have never used Lyft. That’s when I knew my debit card had been compromised. All of those questionable charges now became clear: Someone was using my card for small purchases — all under $20.
The common belief is that the thief will use your credit/debit card quickly and for large purchases, before the alarm bells go off and the account is closed. For me, the card was compromised starting over the summer for a small purchase here and there.
Nothing too big and not more than one or two in a day — even weeks between charges. (In total, the fraudulent charges totaled more than $300 in four months. My balance never dropped significantly, so I was never shocked into taking any action.)
In talking with the credit card company’s fraud department, the representative told me that this was starting to be the trend for thieves — many small purchases over time that would easily be overlooked. (If I had used Lyft with any regularity, the fraudulent charges would have easily blended in with true transactions. There’s a good chance I would not have second-guessed any of the charges.) It seems many people do not go through their monthly statement with an eagle-eye and thieves are counting on it.
After several cases of credit card fraud, I set notifications on all of my accounts. I believed I was finally safe and could quickly shut down any account — after receiving a text about “my purchase” of $300 at a gas station in Orlando, Florida. (One of my accounts was drained of nearly $3,000 because of this example. The card was used for several large gas station purchases in different cities within hours. It was a nightmare resolving the case. In the end, I never received all of my money back, after months of paperwork and phone calls.)
As a result, I have became less obsessed with reviewing my credit card statements, trusting the security system in place would save me from more fraud. The problem is that all of my alerts are set for a fairly high amount (at least, for my budget) of $50. None of the fraudulent charges from the last several months met that threshold, so I never received any notifications.
There’s a good chance these charges could have continued for months or years because there were so inconsequential. I’m just perplexed because the card has never left my possession and no one has access to it. I can only assume my account was accessed through an online purchase or somehow taken when I swiped it at the store.
If it hasn’t happened to you, I hope it doesn’t — it’s very frustrating, time-consuming and, on some level, just creepy that someone has your financial information. It makes you wonder what other personal information they may have.
It’s even more troublesome because many businesses often appear under a different name on a billing statement, making it difficult to decipher fraudulent activity. Because they’re small charges, you’re likely to assume you must have made the transaction for “ABC Company.” After all, who’s going to use a stolen credit card for a $5 purchase, right?
If you haven’t sat down and reviewed your credit card statement lately, you may want to do so. Any small charges you don’t recall making just might open Pandora’s Box.
Have you ever experienced credit card fraud? (My guess is YES!) Do you have any tips or suggestions for dealing with it?
I look forward to our next chat. Remember, there’s always a discount. You just need to look for it. :-)
Stop using your debit card! Everyone! You are putting your money at risk. Always use a credit card even for small purchases. That way you are using the card issuers money. Yes, I know about debit protections but think about it. Remove your risk place it on them. In a dispute they have no incentive to help you recover your money. Thier money … you watch how fast and hard they work to get it back. Debit cards are a scam to put the risk back on the consumer.
One protection is using credit cards (responsibly) rather than debit: rather than fighting for your money back and needing to get by without it in the meantime, disputing credit transactions freezes responsibility.
> I can only assume my account was accessed through an online purchase or somehow taken when I swiped it at the store
Some of the biggest issues over the last 5 years have been breached point-of-sale systems. That is, customers buying in-store at Target or Home Depot swipe their cards at the register, and one of the computers in the network that makes the magic happen was running malware, stealing MILLIONS of card numbers.
Cerainly use credit cards instead of debit cards. But also save your receipts and balance your monthly statement. I have found a fraud and errors on my credit card many times by this method. Don’t be too lazy to check your receipts against the statement. You’re not regret the small amount of time this takes.
Sorry you ran into issues, appreciate the warning for everyone!! I never use debit card unless I withdraw cash at an ATM. I always use credit card even for small purchases–and budget to pay off at end of month so never any charges. If I make a large purchase (furniture, kitchen appliance, etc.) I’ll charge, and may need to pay off in two months time, but never carry balance longer if possible. No debit cards for reasons cited above by others!
Ditto advice from Jeremy and Steve. DON’T use debit cards. They do NOT have the guaranteed protections Federally that credit cards do. Now, most banks will try to cover the losses, BUT, they are in no way REQUIRED to! Thus, your struggle to get your money back. Stay with the credit cards. Until equal protections are in place Federally and State-wise, don’t use debit cards.
And ALWAYS check your statements (bank, cards, etc.) with a fine toothed comb. Small charges are the norm now for theft, either just ongoing small, inconspicuous charges OR small charges to check if you notice, THEN the big hits!
One way to lower point of sale theft of card info somewhat – buy gift cards and use THEM. Every time Kings offers 4X points, I try to buy not only cards for gifts, but for stores I shop regularly. THAT way, when a massive credit card breach happens at the store where you use the gift card, you haven’t contributed your credit card info to the store’s computer data and it won’t be compromised. TRUE, if Kings suffers a breach, my credit card will be there, BUT, it reduces the number of places all my card info resides, thus reducing my risk. And I can check for troubles at just one place (Kings) more easily than checking every store.
Besides, I get a LOT more fuel points at the same time!
There is no way these days to be completely covered, no matter how many freezes or alerts you set in place. The ONLY way to protect yourself is to constantly keep eagle-eyed track of all your finances (and medical records!) and catch trouble as fast as possible. Credit/ identity theft is impossible to truly prevent these days – you can only minimalize the damage and stop it as quickly as possible. Sad truth of today’s reality. Even a “cash-only” life is not total protection. Your social security number is still easily compromised (it’s everywhere and institutions are NOT effectively protecting it) and your identity is thus at risk. Vigilance is a must.
Not fair, but alas, true.
My husband and I write every credit card transaction in our checkbook immediately after purchases and subtract the amount just as if it were any withdrawal from our checking account. (We use a red pen for credit card purchases.) Our check register is kept up to date in Quicken, so we can tell immediately how much money is owed at any time on credit cards. The best benefit is that when the credit card statement comes due, the money is already subtracted from checking! Then all I have to do is send the payment via Bill Pay. I also check on-line statements every day for fraudulent charges so they can be stopped immediately.
Lynda – I do the exact same thing! It ensures I can always pay my bill in full, avoiding any interest or fees. Plus, I make sure my credit cards are earning rewards. If you’re not paying your bill in full every month, any rewards earned are really not rewards at all. More than likely, you’re paying more in interest than what the rewards are worth. Way to go, Lynda! -BKC