Beware Credit Crime

Beware Credit Crime

Newcastle Herald
3 July 2000
Paul Clitheroe Making Money

DID you know that each year thieves are getting away with about $17million worth of credit card fraud in this country?

If you think that's stiff, in the United States it costs an estimated $US1billion annually.

And if the inconvenience of losing your card isn't enough, at the end of the day we all pay for credit card crime through increased borrowing costs and charges.

Remember the good ol' days when you thought your signature was a pretty good safeguard for your credit card.

And we all wrote really fancy signatures thinking it'd stump the crims?

Well, it seems these days that our signatures are no longer enough to safeguard us from the bad guys, and anyone with a credit card is a potential victim.

To make matters worse, credit card fraud is on the rise.

This should come as no surprise as we're using our credit cards more than ever, particularly as we turn to the Internet for more of our transactions.

The latest trend for credit card crooks, particularly popular in the US but now on our shores too, is a scam called `skimming`.

Mostly, you'll find it occurring in restaurants.

It all takes place when the (crooked) waiter disappears with your credit card.

He or she runs it through an illegal device known as a `skimmer', which captures the data contained on the magnetic strip of your card.

This information is then downloaded onto a blank card, which effectively becomes a fully functional replica of yours, all set for someone to go out and have fun with.

The first you know about it is either when you go to use your card only to find it's been blown out to the limit, or when your statement turns up and you can't remember taking that holiday in Tahiti nor making all those hefty cash advances.

There is no sure fire way to prevent credit card fraud (other than by not having a credit card), but there are some simple steps you can take towards reducing the chances of it happening to you.

* Credit cards should be signed in ink as soon as you receive them. Record the numbers and expiry date of each card and keep these details in a safe place.

* Periodically check that you have all your cards, and destroy any cards that you don't use or have expired.

* This may be stating the obvious, but keep your receipts and compare them with your statement. Attach receipts to the statement on which they appear so that you'll know if you've been double billed for anything.

* During face-to-face transactions, try not to let your credit card out of your sight.

* Don't give your credit card details over the phone, unless you're absolutely confident the people you are dealing with are reputable.

The Internet is a great tool for consumers, but crims love it too. Make sure any online order is secure. This means your personal details are encrypted and a good site will advise you of this.

And finally, bear in mind that once you report the loss or theft of a credit card, you aren't responsible for unauthorised charges.

And if your card is used without authorisation before you notice it's missing, the most you're up for is fifty dollars.

Paul Clitheroe is a director of Ipac Securities, a leading financial planning firm. You can contact Ipac in Newcastle on 4952 1921.

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