Credit card fraud protection can be broadly broken into protections designed to prevent fraud, and steps that can be taken to identify fraud early so that it can be addressed as quickly as possible. There are an array of options people can use to protect their credit cards from fraud. It is important to be aware that along with legitimate methods of addressing fraud, there are also scams that claim to offer fraud protection. Consumers can get information about scams from organizations like the Federal Trade Commission (FTC) and Consumer Reports in the United States.
In terms of options designed to prevent fraud, credit card fraud protection is a multi-pronged process involving the card issuer, stores that accept cards, and the cardholder. Credit card companies must encrypt data on their cards, while people who accept cards are responsible for securing the information they collect. People can protect themselves from fraud by keeping their cards in a safe place, using paperless statements to keep their personal information secure, and having mail related to financial accounts delivered to a post office box for additional security.
Even the best fraud prevention can fall short. Credit card fraud protection tactics to address fraud after the fact primarily revolve around identifying it as soon as possible. Many credit card companies and banks monitor transactions and will take action if a transaction appears unusual, calling the card holder or putting a freeze on the card until the issue can be resolved. Fraud monitoring is usually a free service, although some banks and credit card companies offer premium packages with additional monitoring options.
Consumers can protect themselves from fraud by reviewing their statements frequently and closely and periodically ordering copies of their credit reports to look for unusual activities. If fraud is identified, notices can be filed with the major credit bureaus to put a fraud alert on a customer's account. This form of credit card fraud protection is designed to prevent additional fraud from occurring while a problem is addressed. While the alert is in place, anyone who requests a copy of a person's credit report will be warned that the person's identity has been used fraudulently.
Numerous companies offer credit card fraud protection services, claiming to protect consumers from fraud and identity theft for a fee. Such services should be evaluated closely. Some only duplicate the services always offered by banks and credit card issuers. In the case of companies that offer “loss protection” that guarantees that customers will not have to pay for fraudulent activity, consumers are paying for the privilege of a service already offered. Banks and credit card companies will remove fraudulent activity from a customer's statements once proof of fraud is presented.
