Did you know: March is Fraud Prevention Month in Canada? Despite awareness efforts, banking and credit card fraud remain prevalent. The first step to avoid being a victim of fraud is to recognize when you're being targeted. Here are six credit card scams to watch out for, provided by Barry Choi of Moneywehave.com. Credit card scams have been around for some time but criminals are always coming up with new ways to obtain our information. It’s easy to fall victim if you’re not paying attention so here’s a list of common credit card scams to be aware of.
Skimming is one of the oldest credit card scams and anyone can be a victim since it’s hard to detect. Thieves tamper with ATMs and collect your credit card data so they can clone it later. They also install a secret camera to capture your PIN as you enter it. Without your PIN, cloning your credit card is useless so make sure you cover the keypad when entering your PIN.
This scam has become quite popular in Canada in the last few years. The scam works like this: You receive a call saying you won a vacation or prize and all you need to do is answer a few questions to make claim your prize. After answering the questions you’re then told you’ll need to pay a small admin fee and taxes by credit to process the prize. Once your card has been charged, you won’t hear from the company again. If you receive an automated phone call saying you’ve won a trip or prize and to call back, don’t bother as this is most likely a scam.
Giving back means a lot to people and thieves will try to capitalize on your goodwill. Be suspicious of any unsolicited phone calls from charities asking for a donation via credit card. If you’re unsure if the charity is legit simply ask them for their website so you can do your due diligence. Never give out your credit card information over the phone to anyone you don’t trust.
Phishing is when thieves send you an e-mail posing as a bank or some other legit organization in an attempt to get your username, password and possibly your credit card information. They’ll go to great lengths to make the e-mails look real so you’ll click a fraudulent link that’ll give them access to your sensitive information. To prevent phishing most organizations don’t communicate with their clients via e-mail; all contact is now done through their own websites. If you think you’ve been a victim of phishing, contact the organization immediately and change your passwords.
This scam targets people who have trouble getting loans from traditional lenders. The bogus lender advertises loans with low interest rates as long as the borrower can come up with an advance-fee. Some will claim that they’ll apply for a loan on your behalf but that’s just another scam to get your personal information which they’ll use later. If you have a poor credit rating getting a loan from a bank will be tough. There are secondary lenders that will loan you the money but they’ll expect a higher interest rate since they are taking a risk on you.
Credit Repair Services
There are many ads out there that advertise that they’ll increase your credit rating for a fee. Sounds like a good idea if you’ve had a bad history with credit but you’ll just end up in more trouble once the company takes your money and disappears. The only way you can repair your bad credit is to simply pay off your debts. If you’re struggling to make your payments, consider talking to your bank about consolidating your loans or filing for a consumer proposal.
One of the best ways to protect yourself from credit card fraud is to monitor your bills regularly and to report any suspicious transactions right away. It’s also a good idea to get a credit report from Equifax or TransUnion every year just so you can review your credit history.