What to do if your credit card has been compromised

Think about how often you use your credit card or debit card on a day-to-day basis. From online shopping to purchasing your groceries, you probably use this convenient form of payment at least once a day. And, while using credit cards to pay for your expenses is convenient, it comes with its own set of risks. Despite how careful you may be, it’s incredibly easy to fall victim to credit card fraud.

Credit card fraud is on the rise

According to data from the New Zealand police, in the two year period from July 2007 to June 2009, just over 37,000 credit cards were stolen or lost. These cards racked up an estimated total of $8,296,698. That was over a decade ago, and with the technological advancements that have occurred from then to now, credit card theft and fraud has only increased. Criminals can employ a variety of tactics like outright stealing your physical credit card, skimming your card’s numbers electronically or hacking into stores’ payment systems to steal credit card information. As such, finding out your credit card has been compromised is, unfortunately, a common occurrence for New Zealanders and people across the globe.

Card theft can be daunting

Despite the commonality of credit card theft, when it happens to you, it can definitely be frightening. The first step you must take if you suspect your card has been compromised is to take action. Yes, it is unfortunate and inconvenient if a criminal steals your credit card information. However, you can’t dwell on it. You need to get up and face the problem, as brushing it off will only leave you more vulnerable to financial criminals.

Protect yourself and your financial health by taking these steps below if you suspect your credit card has been compromised.

Review your account and contact the Bank/Issuer

Some companies employ a theft detection service to help snuff out fraudulent use of your card, but you can’t rely on that service alone. That’s why it’s good practice to get into the habit of checking your account statements daily or weekly. This allows you to easily identify when a fraudulent charge or charges are made. If you notice any suspicious activity, it’s imperative that you contact your bank or card issuer immediately.

Report all the facts you know about the charge so that they can flag your account, which typically involves freezing the current card. In some extreme cases, banks or card issuers may freeze your account. Your bank or issuer will now know to decline any other charges from the suspended card. They will send you a new card to use. If you have your current card (i.e., it wasn’t physically stolen or lost), make sure to dispose of it safely. This first step relies on your diligence and the speed of which you report suspicious charges. In many cases, quick reporting can keep the situation under control.

Update your personal account information

Regardless of how a criminal got your credit card information, you need to take the time to update your personal account information. With the technological advances we’ve experienced in recent years, your information may have been compromised through a cyber attack. These attacks allow criminals to potentially access (and change) your account information.

Once you’ve noticed suspicious card activity and you’ve contacted your bank, you should log in to your account. Verify your contact information is correct. This is particularly important, as your bank will be sending you a new card and you want to make sure it goes to the right address. You should also change your password just in case that was compromised, too. When you’re choosing a new password for your credit card account, you want to make sure that it is not the same password you use for anything else. It should be between 8-16 characters long, include both uppercase and lowercase letters, numbers and special characters (provided the site allows you to do this). Choose something that’s unique and not easy to guess. This means that you should avoid using any part of your name, a birthday or address.

Update your recurring payments

After you’ve received your new card, it’s important to update any billing information appropriately. While you’re waiting for your new card to arrive, catalogue the bills or recurring payments that you used the inactivated card for. That way, when the new card comes it’s easier to go into each account and enter the new card digits. This is a very important step to take to preserve your overall financial wellness. Failing to do this could result in late or missed billing payments, which can result in late charges or credit hits.

Don’t let the reaches of credit card theft impact your life more than it has to. Credit card theft can be managed and reversed, missing payments due to getting a new card cannot. And, if you have any payments that you know will come up between when you alerted your card issuer or bank to the credit card theft and when you will be getting a new card, call the company and make a payment with a different card or account. You can also try explaining to them that you were the victim of credit fraud and are in the midst of getting a new card to see if they’ll give you an extension on payment.

Stay on top of your account

Keep checking your account statements to ensure that the fraudulent charges are removed from your account. Moreover, you’ll want to make sure that no new fraudulent charges are allowed to get posted to your account. By monitoring your account and checking it regularly, you can stay abreast of changes and improve your financial health.

Summary:

Credit card theft is unnerving. While you hope that it never happens to you, in today’s tumultuous world, you can expect that it will happen to you at some point in your life so you need to know what to do when it happens. Talk to your card issuer or bank to find out more about any fraud protection services they may offer.