Credit Card Fraud Terms

Credit card fraud is not something people want to deal with, but understanding the different types of fraud and fraud terms can help if issues do arise.

This guide explains some of the fundamental elements of credit card frauds so that you have a better awareness of the risks and can handle any problems with a cool head if they do arise.

Clone Card

A clone or dummy card is a credit card that has been created by frauds using information from an actual credit card.

Usually these are created through skimming or identity theft processes and can cause havoc for a long time before either you or your bank pick up on unknown transactions.

Identity Theft

Identity theft occurs when someone gains enough personal information to use another person’s identity as his or her own. In credit card this can happen in two ways:

1. Application fraud – where they have obtained a credit card application and details either through documents from you or your trash.
2. 2Account takeover – where they gain partial or full control of your credit card account through a stolen card or a cloned card

Suspected or proven identity theft should be reported to your credit card provider as soon as possible.

Phishing

Phishing refers to online scams, usually conducted via emails that appear to be legitimate organisations in order to gain personal details.

These emails may look very similar to the real thing and may be accompanied by an official-looking website, however, slight changes could give it away as a phishing scam.

The best way to be sure is to contact your bank or credit card provider if you receive an email claiming to be from them and requesting account details.

Most financial organisations will have a policy against requesting information via email as well, which should be a good indicator of a scam.

Phone Scam

Like phishing, a phone scam will be set up to seem like a legitimate request for your account details. In this case the scammer will actually call and pretend to be from the bank, however, so it could be harder to tell right away how great the risk of fraud actually is.

The best way to be sure is to tell them you will call them back, then phone your bank’s official number and explain the situation.

That way, if it is legitimate you will still be able to confirm your details, and if not you have just saved yourself a lot of time, hassle and possibly money.

Skimming

Skimming is a method of recording credit card details via devices attached to ATMs and EFTPOS machines.

Once the card has been swiped and the PIN entered, the data will be transmitted or collected by fraudsters and used for phone or online transactions or to create a clone card.

With a better understanding of these terms it is easier to be protected against fraud and prepared for it if it is ever an issue.