Credit card fraud is a growing concern in Australia, but there are steps you can take to stop yourself from becoming a statistic.
Scroll on to learn about the tactics fraudsters use to steal your credit card details, the anti-fraud protection offered by your credit card, and additional measures you can take to protect yourself. And if you suspect someone has been using your credit card fraudulently, find out what you can do about it.
Coming up next
Key takeaways
- Payments fraud has been on the rise.
- You can take steps to protect yourself from credit card fraud, including checking your credit report and reading your statements.
- Credit cards have built-in fraud protection that can block fraudulent transactions.
- If you suspect you've been a victim of credit card fraud, take immediate action.
Common types of credit card fraud
There are several types of credit card fraud that can occur, including application fraud, card not received fraud, counterfeit card fraud, and card not present fraud.
Credit card application fraud
- What it is. Application fraud occurs when someone uses your personal information to apply for a credit card in your name.
- Example. After acquiring your name, address, etc., a fraudster impersonates your and applies for a credit card without your knowledge or consent. If approved, they may intercept the card before you notice.
Credit card intercepted fraud
- What it is. A fraudster intercepts a new credit card in the mail. They can skim it and then deliver it, hoping you do not notice any tampering. Alternatively, they can attempt to activate it and use it.
- Example. Your bank issues a replacement card since your existing card is about to expire. Alternatively, you apply for a new credit card. The fraudster intercepts the credit card before it is delivered to your address.
Counterfeit credit card fraud
- What it is. Counterfeit card fraud occurs when someone creates a fake credit card with your information and then attempts to use it to purchase something.
- Example. Having skimmed or acquired a credit card, the fraudster creates a fake credit card with your name and information and then uses it to make unauthorised purchases.
Card-not-present fraud
- What it is. Card-not-present fraud is when someone uses your credit card details to make purchases without physically possessing the card.
- Example. After skimming or acquiring a credit card online, a fraudster attempts to make online purchases. They will typically attempt several small transactions at first, hoping you do not notice until it's too late.
How fraudsters get your card details
There are many ways that fraudsters can get your credit card details. The most common methods include phishing, skimming, hacking, and acquiring a credit card on the dark web. Understanding how these methods work and how you can protect yourself is important in preventing credit card fraud.
Phishing
- What it is. Phishing is a type of scam where fraudsters impersonate a trusted source to trick you into revealing your personal information.
- How to protect yourself. Don't click on links or download attachments from unknown or suspicious sources, or share credit card details with anyone you don't know, download.
Skimming
- What it is. Skimming refers to the practice of stealing credit card details using a device that can read your card's magnetic strip. Once captured, the details can be used to make unauthorised purchases, typically online.
- How to protect yourself. Be cautious when using an ATM or payment terminal. Keep your card in sight when making purchases, cover the keypad when entering your pin, and inspect the card reader for any signs of tampering.
Hacking
- What it is. Hacking refers to unauthorised access to a computer or electronic system such as your personal computer, the computer system of a retailer where you shopped, or the bank that issued your credit card. Sensitive information that can be stolen includes credit card numbers, expiration dates, names of cardholders, and addresses.
- How to protect yourself. Use a strong password and change it regularly. Use two-factor authentication where available. Keep your operating system and anti-virus software up to date. Be cautious when clicking on links in emails or messages, even from people you don't know.
Dark web acquisition
- What it is. The dark web is a part of the internet that is not accessible without specialised software. It is used by criminals to buy and sell stolen credit cards.
- How to protect yourself. Use a unique and strong password for every online account. Keep your software up to date (operating system, browser, etc.) and use a VPN to secure your internet connection. Be cautious when clicking on links in emails or on websites you are suspicious of.
Built-in credit card fraud protection
Most credit cards in Australia have built-in protection against fraud, meaning that if someone steals your card details and tries to make a transaction, your card issuer will likely detect this and prevent it from happening.
- ANZ. ANZ's fraud protection service is called ANZ Falcon, a range of credit card protection measures, including real-time fraud monitoring and SMS alerts to notify you of suspicious activity on your account.
- Commonwealth Bank. Commonwealth Bank's credit cards are equipped with advanced fraud protection systems, including 24/7 monitoring and the ability to block suspicious transactions quickly.
- NAB. NAB offers a fraud protection guarantee for its credit cardholders, promising to cover any unauthorised transactions made on your account. In addition, NAB uses sophisticated fraud detection systems to monitor real-time transactions.
- Westpac. Westpac offers fraud protection for its credit cardholders, including real-time monitoring of transactions and SMS alerts to notify you of any suspicious activity on your account.
General credit card fraud protection tips
In addition to the built-in protection offered by your card issuer, there are several steps you can take to protect yourself from credit card fraud.
- Monitor your credit report. Regularly check your credit report for suspicious activity, such as credit applications in your name that you did not submit. You can do this for free. Checking your report does not affect your credit score.
- Use a VPN to secure your internet browsing. A virtual private network (VPN) encrypts your internet connection, making it more difficult for hackers to intercept. Particularly useful when on a public network such as those available at cafes and hotels.
- Keep your software up-to-date. Keep your operating system and browser updated with the latest security patches to prevent hackers from exploiting vulnerabilities in outdated software.
- Don't use the same password more than once. Using the same password across multiple accounts makes it easier for hackers to steal your identity if they crack one password. Use unique, strong passwords for each of your accounts. A password manager makes this much easier to manage.
- Secure your mailbox. Don't make it easy for thieves to steal your mail.
- Don't lose your card. Keep your credit card safe, and if you lose it, report it to your card issuer as soon as possible.
- Keep your card in sight when paying. When making a payment in person, for example, at a restaurant, keep your card in sight so it can't be easily skimmed.
- Be careful when using an ATM. Cover your hand as you enter your PIN so a "shoulder surfer" can't record and steal it.
- Read your credit card statements. Check your credit card statement for unauthorised transactions, and query anything that looks odd with your card issuer.
- Properly destroy paperwork. Shred documents such as credit card statements or otherwise destroy them completely.
- Keep your account contact details up-to-date. Make sure your card issuer has your correct contact details so they can quickly reach you in case of suspicious activity on your account.
What to do if you suspect fraud
If you suspect your credit card has been used fraudulently, it is important to take action quickly to minimise the damage. Here's what you need to do.
- Notify your credit card issuer immediately. Your issuer will then investigate the matter and take appropriate action, which may include cancelling the card and issuing a new one.
- Change PIN. If your card is not being replaced, consider changing its PIN to add an extra layer of security.
- Change passwords. If you suspect the fraudster got your details online, change passwords for services you use, especially your email and any other accounts that use the same password.
- Get a copy of your credit report. Check for any suspicious activity, such as applications you did not make. Dispute them if there are any.
- Phishing victims should cease contact immediately. If you were the victim of a phishing scam, immediately cease all communication with the scammer. Do not provide any further information or send any money. Keep the email thread as evidence.
- File a police report. If you have lost money due to fraud, file a police report so that the authorities are aware and can begin their investigation. You may need a case number to file an insurance claim.
FAQs
How do fraudsters steal credit card details?
Fraudsters use phishing, skimming, hacking, dark web acquisition, theft, and mail interception to steal credit card details.
Does credit card purchase protection protect against fraud?
No. Credit card purchase protection insurance covers the theft, loss, and unintentional damage of new items purchased with your credit card.
