There has been a lot of talk on social media lately about credit card accounts being compromised. Many of my friends have had fraud occur on their credit accounts, and the statistics are showing a sharp uptick in fraudulent activity in the last few months. Lots of people are asking themselves, “Why has my credit card been hacked?” What’s behind this? Somewhat surprisingly, it seems that one cause is the introduction of tougher security measures.
The United States is progressing through the transition to credit cards with higher security chip technology. The “deadline” was allegedly last October, but there are still many customers without chip cards and many retailers without chip readers. Criminals are seeing the end of the opportunity to do “simple” fraud, and they’re stepping up the pace to make as much money as possible before the new technology makes fraud harder. The result: an increase in fraud being seen by the entire banking sector.
Financial industry analysts predict that credit card fraud will be up 12.5% in 2016 and then decrease sharply as the last of the magnetic strip cards are replaced with chip cards.
Results of chip technology look promising so far: Visa reports that in January 2016, chip-enabled merchants had a 26% decrease in fraud from the same time last year.
While it is good to understand WHY this increase in fraud is happening, it doesn’t make it any more fun when you’re the victim. To make things even worse, banks and credit unions are scrambling to the higher fraud rates, which can leave customers feeling frustrated. A little preparation can make the process easier if you are ever the victim of credit card fraud.
First, be sure that you know what credit cards you own, who issues them, and the important card details. Keep a list of the phone numbers to call in case your cards are compromised.
Most of my readers are USAA members. For information on how to report fraud to USAA, read here: USAA Report Fraud.
Many of my readers also use Navy Federal Credit Union. For information on how to report fraud to Navy Federal Credit Union, read here: NFCU Report Fraud.
Also popular with my readers is Pentagon Federal Credit Union. For information on how to report fraud to PenFed, read here: PenFed Credit Card Security Center.
Second, check your accounts regularly. The faster you report questionable activity, the sooner it can be stopped and resolved.
As always, be sure you are keeping your card information safe by being smart and using good credit card practices.
The move to chip-enabled credit cards should significantly decrease fraud in the long run, but it’s a little painful right now as thieves scramble to use the information they have for the largest gain before time runs out.