How to Guard Against Credit and Charge Card Fraud

Guard against cerdit and charge card fraud.

Dealing with credit card fraud is frustrating. According to the Federal Trade Commission (FTC) as of 2009, nearly 9 million Americans have dealt with some form of identity theft. Reviewing your credit card statements carefully, requesting a credit report annually and disputing questionable items quickly can help you guard against credit card fraud.

Instructions

1. Review your statements regularly. Often, thieves will try small charges, as small as a couple dollars, to make sure your account works. After succeeding with these small charges, the flood gates open. They continue to make charges until the card no longer works.

2. Report unauthorized credit card charges. If you notice suspicious charges, contact your credit card company immediately. They can close your account and issue you a new card quickly. Charges that weren't authorized can be investigated. After the investigation is complete, which usually requires signing documentation that you didn't make the charges, the funds are typically credited back to your account.

3. Review your credit report every 12 months. You are entitled to a free credit report annually (See References). Review the credit report line by line. If you find a fraudulent credit card account--opened without your permission--file a police report. Send a dispute letter to the credit bureau, including your legal name, address and explanation of the issue. Attach a copy of the police report. Credit bureaus typically respond within 30 days. Once your dispute is approved, the information will be removed from your credit report.

4. Consider putting a fraud alert on your account. According to the Federal Trade Commission, a fraud alert stays on your credit report for 90 days. It will make it very difficult for others to use your credit cards or open new cards in your name. An alert needs to be placed with each credit bureau (Equifax, Experian and TransUnion). This can be accomplished by calling each company.

Tips & Warnings

• Protect your credit card information. If you plan on buying something from a new company, check them out. The Better Business Bureau is a great resource for learning if a company is reputable.

• Don't wait too long to report charges. Depending on your creditor's terms of agreement, if you wait longer then 60 days to report charges, they may deny your claim. Also, if they've determined that you acted neglectfully, such as throwing your card in a trash bin on purpose, the creditor may deny your claim.

References

• Federal Trade Commission: Recover from Identity Theft
• Federal Trade Commission: How to Dispute Credit Report Errors
• Annual Credit Report