How to Stop Repeat Credit Card Fraud

This article tells what to do to if you're experiencing repeated credit card fraud, even when you've obtained a new card number. The usual steps, which should be followed and will be reviewed here, may not be enough to prevent your new number from being immediately frauded, possibly before you've even validated the new card!

Credit card scams have reached new levels of sophistication that make it very tough for cardholders to protect their information, their credit rating, and even their identity. How your credit card company handles your account after you report to them makes all the difference.

Do the steps usually recommended for handling credit card fraud, and then go the next necessary step to untangle the web of fraud and prevent it from recurring.

Difficulty: Challenging

Instructions

Things You'll Need:

• One central paper (hard copy) file for documentation.
• Internet connection and printer for downloading forms.
• Patience, determination.
• Optional: a hands-free phone headset comes in very handy for those long, long waits to speak to the right company or agency representative.

1. Contact your credit card company or bank immediately. Report the loss of the physical card or the use of your credit card number to their Fraud Department. Ask for the name of the representative you deal with. They will close/cancel that account while you're on the phone. Work with your issuing company to resolve any on-line charges that are unauthorized. If you still have your physical card, cut it up small or, better still, shred it. A new card will be mailed to you. If this is your only card, there will be a few card-free days to deal with while you wait for the new card in the mail, so dig out your checkbook or prepare to carry cash. Actually, until you're relatively sure how your card number was accessed, you may prefer to play it safe and refrain from using any other cards for a few days.

2. Ask your company to issue you an entirely new series of numbers, or, at least to change the last 7 numbers. Not all card company fraud representatives are aware of the kinds of repeater scams discussed here. The rep you reach may not be authorized to do more than issue a change in the last four numbers. If this is the case, ask to speak to a supervisor.

3. Monitor your new number on-line, even if you have not yet received your new plastic card. Check the account several times a day. Some companies have software for alerting you by email for all charges or for charges over an amount you determine, and for daily balances. If this is available, use it and set the alerts at the maximum level: you'll want daily balance alerts and an alert each time the card is used. Input the minimum amount the software allows (usually $1.00). It may be annoying to get so many emails, but better safe than sorry. You can discontinue this alert system once your new account seems secure...in a couple of months, usually.

4. Start a paper file. Begin with a hard-copy letter to your issuing company reiterating your complaint and the steps you've taken with them by phone. Never fail to record and file anything you do regarding this theft and its resolution.

5. Begin eliminating avenues for future fraud. This means cancelling any automatic monthly charges to your account and finding a new way of dealing with those services and providers(debit or checking account authorization, etc.)...including doing without them for a time, if necessary.

6. At this point, you may be deciding to skip all these dealings with your old company and start from scratch. If your card has already been frauded more than once (and these can happen sequentially and in rapid succession), you might be ready to take this step. Sometimes, this is the only way to stop the thievery. If you have succeeded in getting an extensive change in your account number, however, it may not be necessary to start over with a new credit card company.

7. The generally recommended steps are included here; they are necessary but not adequate to prevent repeat credit card fraud. Do them in addition to the steps above: 1) Change your account password and the passwords for any accounts you plan to use your new number with. 2) Place a fraud alert on all three major credit reporting websites (Experian, Equifax, and Transunion). Ask for a hard copy of your report and follow up to each with a letter re-stating your request. Just search on the three big names to get phone numbers and mailing addresses. 3) Contact the Federal Trade Commission [phone]. After filing your report, download a copy of their Fraud Affidavit, complete it and mail it. Keep a copy for your file. 4) File a report with your local police department. Get a copy of their report for your file.

8. Once you've done all this, monitor your account daily. Do not be naive about the lengths thieves will go to with credit card fraud and identity theft. They've got all the time in the world to figure out how to cheat you and, apparently, it pays.

Tips & Warnings

• While this may all seem like an excess of caution, I know from experience that it is possible to have your new card numbers frauded five times within as many months by the type of scam described here. The scam that victimized me began with a number theft during a vacation. It was eventually traced to links in California and Bangladesh.
• Randomizing four numbers is easy given enough time and enough computers; scammers are willing to go to the trouble. This type of scam is rampant currently.
• Be scrupulously polite and patient with folks on the phone; they are trying to help and they'll be much more helpful if you're kind and grateful.
• Don't try to trace these people down yourself. Don't try to contact them. If you discover anything, add it to your local police report.
• Don't alert the "test" merchant (the one used to try out the card number for a smaller amount) by calling them yourself. Leave that to the FTC. Don't make their job harder by trying to do it for them.

Resources

• FTC's Identity Theft Site