Credit cards (and the way we use them) are undergoing a transformation. By now, any cards you have should have been replaced by a new card with “chip and PIN” technology. You’ll notice a little square chip on the front side of the card:
In the future, that chip will always be used instead of the magnetic strip on the back to transfer your card information to the merchant. You insert the card into the bottom of the card reader and hold it there, and the card reader takes your info from the chip. This is significantly more secure than the old swipe the magnetic strip method. And eventually, the old procedure of signing for purchase will be replaced by the entering of a PIN number.
And while the card providers have done a good job of issuing the new cards to move toward this technology, the merchants are slow to catch up. Most places I shop are still using the old swipe and sign method. And those merchants who do have the new “dip the chip” technology in place (so far I’ve only found it at Wal-Mart and Target) are still using signature rather than PIN….and that isn’t expected to change any time soon. If you happen to travel to Europe, however, make sure you know the PIN for your credit card. They’ve been using chip and PIN for years.
The U.S. is a bit slow to catch on to this technology, but in the future it should be helpful in reducing fraudulent card use. And this ultimately protects you. Change is hard. But most times it is worth it.
It seems like just yesterday that I had to have a new credit card issued because of the Home Depot data breach. And now my new replacement card has been compromised as well. Only a month after I finished changing all of my auto-billed payments to the new card, I have to do it all over again. In the greater scheme of things, I really can’t complain. I’m still a little stunned by the number of things that went right in my recent credit card fiasco.
The first thing that went right is that I was using a credit card rather than a debit card. Credit cards offer greater protection against fraud than debit cards. If this had been a debit card, the money in my checking account could have been tied up while the issue is being resolved. Because it was a credit card, I can’t be held liable for more than $50 in fraudulent charges. And I’m extra fortunate because my credit card provider is refunding all of the fraudulent charges.
The second thing that went right is that my credit card provider recognized that an unusual charge had been made and contacted me right away. Wednesday night I received a text message from Chase asking if I had made a charge for $50 at a grocery store in New Jersey. I had not. I called Chase and we went through all of the recent charges, and found (thankfully) a total of only two charges, $108 combined, that were fraudulent. Chase then shut down that card immediately so no further charges could be made on that account.
The third thing that went right is that I’m very aware of my credit card activity and I monitor it online almost daily. I had looked through my charges the morning before the fraud occurred, which saved a lot of time on the phone with Chase. I was able to just say, “Everything through yesterday was my activity,” and we only had to review one day’s charges.
The fourth thing that went right is that I have other credit cards. I use my Chase card instead of cash most of the time in favor of reaping the reward points. I like the convenience of using plastic instead of cash. And when my card was shut down, that could have left me at a loss for a couple of days until my new card arrived. Luckily, I have another rewards card that I generally only use at stores that don’t accept Visa. I was able to just use that until my new Chase Visa was delivered. A backup plan is a very good thing. I also have another card that I do not keep in my wallet…just in case my wallet is ever stolen. I always want to be prepared.
I don’t know exactly how my card info was stolen. My card itself is still in my possession. I figure it must have been either a skimmer that I didn’t notice when I swiped my card (though I always try to look for those), or it may have been a less than honest employee at a restaurant or convenience store who skimmed the card when it was out of my sight. Regardless, the result is the same. I feel somewhat violated because someone stole my credit card information. But I have experienced no financial loss…only a minor inconvenience. A lot of things went right for me in a situation that could have been much, much worse.
I really haven’t paid attention to the idea of scammers for a while. Phishing. Smishing. Phone scams. Everybody knows about that, right? Do we have to still think about it? Apparently the answer is yes.
I have elderly parents. And last week they received a phone call from someone claiming to be from Microsoft. The man on the phone said he knew that my folks had been having trouble with their computer and he wanted to help. My father, who always struggles with his computer (I blame Windows 8), was ready to listen. Luckily my father never gave out his credit card information (which is how this scam usually ends), but he did direct his computer to several websites. I haven’t been able to get to their house to examine the damage yet, but I’m fairly certain that viruses and malware have been released. I have my folks carefully checking their credit card activity every day to watch for fraudulent charges, as I know they have used their card for online purchases and that number is likely stored in their computer’s memory somewhere.
So fraud is out there. I guess it always will be. How do you protect yourself against it?
Here are some things you SHOULD do:
- Check your banking/credit card statements regularly to make sure every transaction is one you remember making.
- Check your credit report at least once a year (http://www.annualcreditreport.com).
- Change your online passwords regularly—to something complicated that includes letters, numbers, and symbols.
Here are some things you SHOULD NEVER do:
- Give your credit card number out on a telephone call that you did not initiate
- Click on a link in an email or text from someone you don’t know/trust
- Email sensitive information such as your Social Security number
- Call back the number of a missed call from someone you don’t know who did not leave a message identifying themselves
- Wire money to a stranger (yes….people still do this!!!)
I could probably go on and on. But instead I’ll leave you with this helpful information from the Federal Trade Commission.
Watch yourself! Scammers are still out there, and likely always will be.