• Summer Credit Card Scams

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    My second tip is how to avoid being a victim of “skimming,” when crooks use a concealed spy camera or an electronic device to record your card number and secret PIN code, then drain your checking account. Be smart. Avoid sketchy stand-alone ATMs in favor of those inside banks, and play it safe by covering your hand as you enter your pin. Of course, always get a receipt and be sure your session has ended before you walk away from the machine.

    Last week, Consumer Reports stated that 19.5 million consumers had charges placed on a credit card by an unauthorized person.

    And that’s just from old-school credit card crime. Technology is advancing at such a fast pace and scammers are keeping pace. It was recently reported there is a free android app that can be used to read credit card information from a nearby card even if it’s not visible.  That means all a thief needs is a smartphone to read credit information from a contactless card, such as a card number, expiry date and cardholder name simply by holding the phone over a credit or debit card—even through wallets, pockets and purses.

    What is a “contactless card”?

    Contactless cards have an embedded radio chip, and that radio frequency identification, or RFID, allows cardholders to simply hold their credit or debit cards within an inch or two of a card reader to complete a purchase transaction. No signature is required on purchases less than $25. No more swiping the card through a reader. No more handing your card to the sales clerk. No more contact.

    Although the technology hasn’t received as enthusiastic a reception in the U.S. as in Europe and Asia, contactless cards are far more common than they might seem: According to the Smart Card Association, about 100 million of the RFID-enabled cards are in circulation. In fact, you may have a contactless card and not even realize it. Take out your credit card and turn it over. Look for one of the “contactless” RFID logos: Chase Bank coined the term Blink, Visa calls its technology payWave, MasterCard dubs it PayPass, Discover brands it Zip, and American Express calls it ExpressPay. Or look for the universal “wireless” symbol: that triangle of nested arcs.

    How do you suggest our listeners protect themselves?

    Well, it remains to be seen if the new technology will actually increase fraud. If you’re really not comfortable having a contactless card, you could nuke it, but I wouldn’t advise that route: Three seconds kills the chip, five seconds starts a house fire. Just ask your card issuer for a card without the chip.

    And as always, the easiest way to protect yourself is to monitor your account activity online regularly and contact the issuer immediately if you see any charges you didn’t make.  Most credit card companies will reimburse you for fraudulent charges. If the charge was on credit, you’re probably liable for up to only $50. (That limit doesn’t apply to debit charges.) If you take appropriate precautions, you’ll hopefully have a safe and prosperous summer!

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