According to the Nilson Report, credit card fraud losses soared to a significant $28.63 billion in 2022, indicating that perpetrators are extracting more funds from credit card users than ever. In today’s digital era, heightened awareness and proactive measures are imperative to shield oneself from credit card scams.
Scammers always find new ways to trick people. But the most common tricks involve unexpected phone calls, emails, or texts. They might pretend to be from your bank or credit card company. Or they might try to scare you by saying your account is in danger, hoping you’ll give them your personal information.
Regardless of the method they employ, scammers aim for one thing: obtaining your credit card details. With this information, they can make unauthorized purchases or even commit identity theft.
Let’s talk about some of the most usual tricks scammers use with credit cards, and tips on how to stay safe from them.
Scams related to Jury Duty and Law Enforcement
Scammers might contact you through phone calls, emails, or text messages, pretending to be from a nearby court or police station. They could allege that you’ve missed jury duty or owe fines, claiming that a warrant has been issued for your arrest. They’ll insist that the only way to resolve the matter or pay the fines is by providing them with your credit card details.
Courts and police departments have a policy of never contacting individuals to demand payment via phone, email, or text. Should you receive any communication of this nature, it’s crucial not to disclose any personal information or make any payments. Instead, take prompt action by notifying your local Clerk of Court’s office without delay. They can investigate and advise you on the appropriate steps to take in response to such suspicious communications.
Scams involving programs that claim to help reduce debt
This scam involves offering individuals immediate relief from their credit card debt or lower interest rates by the scammer, who requests an upfront fee in return.
The Federal Trade Commission (FTC) has identified instances of scams related to debt relief services aimed at individuals facing significant credit card debt. Scammers may assert that they’ll negotiate with creditors to settle or diminish your debt, yet have no intention of following through. These fraudulent operations typically demand substantial upfront fees from financially struggling consumers but fail to deliver any meaningful service. The FTC has taken numerous law enforcement measures against such deceptive credit-related services.
Skimming Fraud
Skimming scams happen when crooks put sneaky devices on gas pumps and ATMs to steal card numbers. For example, in San Diego in 2022, three guys got sent to jail for a big $1 million skimming scam all over the country. They stuck these devices on gas pumps and ATMs to swipe personal info from people’s accounts. Then, they made fake debit and credit cards with the stolen info to take money out of people’s accounts or buy money orders from the post office.
Departmental Fraudulent Activities
Fraud department scams happen when tricksters reach out to you, pretending that your card has been hacked. They then steal your info when you confirm the numbers and personal details. For instance, some folks have gotten calls from scammers pretending to be from their bank, asking for confirmation, which resulted in unauthorized transactions.
Another way scammers do this is by pretending to be from the IRS. They send emails that try to fool taxpayers into giving away personal and money details. These emails look like they’re from the real IRS, but they’re not. They have links to a fake website that seems real but isn’t.
Always be careful if you get unexpected calls or emails asking for your financial info, and don’t click on links in emails that seem fishy. If you think you might have been tricked, change your IRS e-file details right away.
Credit Card Repair Scams
In the credit card cleaning scam, scammers claim to clean the magnetic strip on your card for better readability. However, they actually skim it to steal your account details. Victims think their card is safe, but discover unauthorized transactions afterward.
Prize Fraud Schemes
Lottery and prize scams happen when dishonest people tell others they’ve won a big prize, like a lottery or a sweepstakes. They’ll then ask for money or personal information, like your bank details, to supposedly claim the prize. But in reality, there’s no prize, and they’re just trying to trick you into giving them your money or sensitive information.
Overdue Utility Payment Deceptions
Late utility bill scams are very convincing. Scammers pretend to be your utility provider and demand immediate payment, threatening to cut off your services if you don’t comply. They usually request payment using methods such as wire transfer, reloadable debit cards, gift cards, or cryptocurrencies, which are hard to trace and nearly impossible to get back.
Technical Support Fraud
Tech support scammers often pretend to be from well-known computer companies such as Microsoft. They’ll say they’ve found a virus on your computer and offer to remove it if you pay them upfront with a credit card. Sometimes, they’ll call you directly and even make it look like the call is coming from a genuine tech support number.
The Federal Trade Commission(FTC) provides comprehensive guidance on recognizing, preventing, and reporting tech support scams. For additional details, you can visit the official FTC webpage dedicated to tech support scams.
IRS ScamsÂ
In this scheme, impostors pretend to be IRS officials asserting that you owe unpaid taxes, which can be settled via credit card, or that your tax refund can be loaded onto a debit card. This fraudulent activity has increased, particularly during tax season, with numerous individuals receiving calls from fake ‘IRS agents’ demanding prompt payment. It’s important to note that the IRS will never request your credit card details over the phone.
Scams involving charitable organizations
Scammers impersonate charities to request donations, especially during times of natural disasters, exploiting the public’s generosity.
Protect Yourself & Stay Informed
Credit card fraud can have serious consequences, but you can take measures to safeguard yourself. Remaining updated on current scams and understanding how to react can lower the chances of falling prey. Here are some important points to keep in mind:
- Exercise caution regarding unexpected phone calls, emails, and text messages. If something appears suspicious, disregard it.
- Avoid sharing your credit card details over the phone or through email. If uncertain about the authenticity of a call or email, reach out directly to the company using verified contact information.
- Ensure that the websites where you input your credit card details are trustworthy and reputable.
- Regularly check your credit card statements to promptly detect any unauthorized transactions.
If you believe you’ve been targeted by a credit card scam, get in touch with your credit card issuer without delay. They can assist you in canceling your card and challenging any unauthorized transactions.