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In 2008, credit and debit card fraud cost the banking industry £609.9 million – an increase of 14% from 2007, according to payments group Apacs.
How does credit card fraud happen?
Credit card fraud generally occurs when a card has either been stolen or copied. If credit cards are stolen and the bank’s not alerted, it’s possible for thieves to carry out card-not-present (CNP) fraud – making purchases over the phone, internet or from mail order companies.
It’s also possible to commit CNP fraud even if the card hasn’t been physically stolen. Cloning, or skimming, occurs when an employee of a shop, petrol station or restaurant puts the customer’s card into an electronic reading device and steals vital details.Something’s phishy
Fraud carried out on the internet is often done by a method called phishing. An email or instant message directs users to enter details at a fake website almost identical to the legitimate one.
Thieves can also acquire information by sifting through rubbish and extracting private information from receipts and statements – which is why it’s so important to securely shred personal documents before recycling.
What to do if you think you’re a victim of credit card fraud
If you suspect fraud has been committed, report your credit card loss to the bank immediately. Most credit card companies will have a 24-hour helpline. It’s worth keeping details of this number on your mobile phone.
All credit cards are regulated by the Consumer Credit Act 1974, which provides a number of protections and requirements. Both the merchant and credit company are liable for the sale. Most companies will refund any unauthorised purchases between £100 – £30,000, although some charge a maximum £50 excess.
Some credit card companies ask users to continue making repayments, including interest accrued, while an investigation is made. This amount is refunded if they reach a conclusion that fraud has been committed.
Top tips to prevent credit card fraud
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Top Tips to Prevent Credit Card Fraud – Credit Card 101
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