Two Minute Money: How to beat credit card fraud

Turner Cowles
Turner Cowles

Welcome to Two Minute Money, Yahoo Finance’s new personal finance series offering quick explanations for some of the most important questions involving your money.

If you see charges on your credit card statement that you don’t remember making, you may have fallen victim to credit card fraud, and you’re not alone. Americans accounted for more than a third of all the credit card fraud in the world—worth a whopping $8.45 billion—in 2015.

Don’t worry, there are ways to protect yourself. When you notice unusual charges, the first thing you should do is call your credit card company. It will review your recent transactions, and you can confirm which charges you actually made.

Most credit card companies will text or call you if they suspect fraud. In fact, fraud detection alerts were up 15% in 2016. But don’t wait for the credit card companies to notice. The sooner you catch fraudulent charges, the better chance you have of getting them refunded. The good news is you’re only liable for $50 in fraudulent charges if they happen before you report the card missing.

Next, file a police report. It may not lead to criminal charges, but having a report can help you deal with creditors and also alert police to a possible identity theft ring. You should also notify your bank even if your credit card isn’t directly linked to your checking account. Informing your bank allows it to keep a watchful eye on your account for additional fraud.

Identity theft is a crime. In addition to contacting your credit card company and bank, report fraud to the police and authorities.

Call one of the three credit agencies — Equifax, Experian or Transunion to let them know you’ve been hit with credit card fraud. You only need to tell one because they’re required by law to let the other two know. While you’re at it, request a copy of your credit report, and make sure you recognize all the accounts listed.

After getting a new credit card to replace the old one, there are some ways to protect yourself from getting hit again. Update your passwords, and don’t use the same one for every website or service. If you have your credit card information stored with an online retailer, delete it.

Always keep an eye on your account so you can spot fraudulent charges early. If you’ve been a victim of fraud, and it’s had a negative impact on your credit, the Federal Trade Commission has a website with tips to help you repair the damage.

Forty-six percent of Americans have experienced credit card fraud in the past five years, but it doesn’t have to happen to you. Outsmart thieves by following these simple steps, and stop fraud from ruining your life.

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