I was shocked by the phone call I received. It was my bank calling to ask if I tried to make two large purchases at stores in California. Given that I was in Minnesota that same day, I knew it wasn’t possible. Luckily my bank had declined the charge attempts.
So, how was my card stolen even though I still had it in my possession?
I had been to California the week before. I only used my card a few times while I was there. However, the card had left my sight after one purchase. A waiter took my card into a back room to run a dinner charge through. It seemed to take too long, and I didn’t feel right about it at the time. I thought back to that incident and realized that I was the victim of identity theft. But, how did the waiter do this? And how was someone now walking into retail stores without my card and still able to make charges on it? I asked my bank how this happened, but they weren’t sure. After canceling my card, I decided I needed to figure out how this process worked…
As we’re all becoming more tech savvy, it seems that criminals are getting more high tech, too. Credit card “skimmers,” that read and store credit card information, have been around for quite a while. But in the past few years, they have become much smaller and are now able to work wirelessly, (allowing a restaurant server the opportunity to carry the device in a pocket). This picture on Flickr shows how small they can be. One small skimmer can store data from hundreds of cards. Typically, the waiter/waitress will sell the credit card information they obtain to another party, who then produces plastic cards that can be used in retail outlets. Besides restaurants, other places to watch for skimmers include retail stores and gas pumps.
So, how can you protect yourself from credit-card theft? The following are tips I picked up, based on my research:
- The most obvious way is to pay with cash at restaurants. Or, if you must use your credit card, follow the restaurant employee to the cash register, and watch them run the charge through.
- Don’t let your credit card leave your sight (this includes the times when the retail clerk needs to use a different machine because the one near the cash register isn’t working).
- Check your accounts for any strange activity on a regular basis. If you notice abuse, report it to your financial institution right away. Federal law protects individuals from any fraudulent credit card liability above $50, providing you report the illegal activity.
- Use credit cards instead of debit cards for two reasons: Credit card charges are easier to dispute, and the $50 federal liability limitation is only good on credit cards, but doesn’t extend to debit cards. Check your credit report. Identity theft can take a while to spot, but it typically will show up first on your credit report. Watch your credit report for inquiries that you weren’t aware of, as well as new credit accounts that are not yours.Use credit cards instead of debit cards for two reasons: Credit card charges are easier to dispute, and the$50 federal liability limitation is only good on credit cards, but doesn’t extend to debit cards.
- Check your credit report. Identity theft can take a while to spot, but it typically will show up first on your credit report. Watch your credit report for inquiries that you weren’t aware of, as well as new credit accounts that are not yours. Federal law allows you one free credit report per year.
- Even though they have gotten high tech, thieves will still go through garbage cans. Shred your trash (including those pesky credit card offers you get in the mail) and don’t throw store receipts in public garbage cans.
- Only give personal information to secure online websites. A secure website should have “https” in the prefix of the web address, not just “http.” Additionally, it should have a lock icon in the status bar of your web browser, and you should be able to click on that icon to check the security information about the website.
I was lucky because my bank caught my stolen credit card before the thieves could do any damage. Hopefully, the above tips will give you a little more than luck when it comes to preventing identity theft.