Protecting yourself against financial scams and credit card fraud

Protecting Yourself Against Financial Scams

Personal security issues are at an all-time high across the globe with the figures on such criminal activities reaching new heights in the face of superior technological developments. Thanks to the internet, the days of simply keeping your PIN to yourself and being completely safe are long gone with people's personal identity able to be mimicked and stolen with relative ease.

The world of scamming is vast and hugely diverse with new schemes being tried and tested almost daily in a multitude of formats and programs, the majority of which are all internet-based. Currently operating as some of the more popular forms of online scamming techniques include:

Investment Scams - share promotions, superannuation scams, real estate scams, investment telemarketing, computer prediction software used for betting scams
Internet Scams - spam offers, online auction and shopping scams, domain name renewals, spyware, key logging systems and modem jacking
Lottery and Competition Scams
Mobile Phone Scams
Healthcare Scams - fraudulent online pharmacies and miracle cures
Money Transfer Scams - "Nigerian 419" scams, transferring money for others, up-front payment options
Identity Theft Scams
Banking and Online Account Scams - including credit card scams, phishing, false fraud alerts, skimming devices

It is these latter scams, identity theft, banking and online accounts scams, which are of a major issue today for many people due to the popularity of online transactions. When it comes to online financial and identity protection, there is a great deal of advice available, as there should be with the online shopping and economy sector being valued as a multi-billion dollar industry with thousands of transactions performed daily.

A recent report compiled and released by Consultants QPR detailing figures on credit card fraud in Australia found that $71,578,908 was charged on credit cards in 2008 through online transactions or similar where the credit card was not present. This is an increase of 33 per cent over 2007.

One area of card fraud that has become more prevalent is card skimming. ATM skim scams are becoming a regular occurrence in the news headlines with over 40 ATMs found to contain electronic skimming devices in the six months leading to May 2009. Experts say that this equates to a high figure, approximately tens of thousands of dollars that may have been potentially stolen from banks under identity fraud.

Established forms of credit cards scams and ATM scams are Phishing emails that ask you to visit a fake website via a link provided, or skimming a person's credit card through a secondary machine to steal the card details and the well publicised "Phone Scam" whereby individuals are contacted over the phone from people claiming to be from their financial institution or similar financial authority. The caller will then be asked to verify a particular transaction and their identity by reading out digits printed on the back of their card.

The latest skimming and scamming techniques being applied across Australia is constantly being updated with authorities recently releasing detailed information of some of the newest trends including false keypads that record a person's PIN during a transaction in conjunction with card skimmers and skimming technology that lies directly on existing parts of an ATM.

Does your bank normally email you? Many banks as a rule do not email you. Mostly they have a message system within their online system. If you receive an email purporting to be from your bank, this should set off your alarm. Just because the email has graphical images and logos that are identical to your bank and the links look like they are for your bank, does not mean it is true. Links in emails can be made to look real but can be engineered to redirect you to another website. Sometimes the link is legitimate but the website is not. Small changes to the website name can mean you are going to a fake site.

Measures you can take to help prevent Credit Card Fraud and Identity Theft

So what are measures people can take to protect themselves against such rising trends? For starters, becoming more actively involved in their financial and credit lives by checking into and becoming familiar with their own credit file.

A credit file contains information associated with a person's financial credit history including name, banking institution, limit details and spending habits. Credit files are designed as a form of identifying a person for official reasons while also providing back up identification for proof of personal details, business or financial history. It is important to note that credit card providers are not allowed access to a credit file without the specific permission of the files owner.
Whenever an application for a loan or credit card is made in your name, the lending institution will typically check your credit file. These checks on your credit file are then recorded on your credit file.
By being aware of any changes to your Credit File as they occur you are able to track any suspicious action.

Credit reference agencies such as Veda Advantage are custodians of credit-related information with Veda Advantage being the largest operator with over 13 million individuals and one million companies' files. Veda Advantage offers its My Veda Alert program, which assists individuals to protect themselves against identity theft and credit card fraud by staying alert to any changes to a credit file. This is performed through a simple email service by which Veda Advantage's monitor servicing system will send a confirmation email to the individual anytime their credit file has:

An application for credit or overdue account listing
A new address, a change of occupation or other personal details
Adverse information such as court judgements and Bankruptcy Act Information

Credit reference agencies will be able to provide you with a copy of your credit file within ten business days of your request at no charge. Alternatively for a small charge your credit file information can be sent to you by email within 1 working day from MyCreditFile.com.au.

Of course, there are well documented measures that people can take to protect themselves from falling victim to such practices including looking for signs of ATM tampering and keeping PIN details private but there has now been a surge in popularity for active protection with many individual now taking steps to protect their finances and identity from fraud or scams. Companies such as Secure Sentinel provide loss assistance and retrieval services on belongings ranging from credit cards to luggage to mobile phones to keys. Secure Sentinel operates by allowing individuals to immediately cancel or put on hold all registered credit cards and other financial cards in one action if items are lost or stolen.

This can prove to be a valuable service with figures showing that 1 in ten thousand credit cards payments were fraudulent and a total 446,713 fraudulent transactions in 2008 were recorded, according to the APCA (Australian Payments Clearing Association).

Protecting oneself against common financial scams is fast becoming the norm in Australia with most people no longer willing to risk their financial and personal identity being copied and used for fraudulent behaviour. Programs such as My Veda Alert and Secure Sentinel have been established to allow people to begin taking as more active role in their own security and protection, while remaining vigilant when completing transactions online and in public remains the highest recommendation.

Checklist of things to do to prevent credit card fraud

Don't let your card out of your sight. Portable skimming machines can steal your card details with a simple swipe.
Examine every ATM machine for skimming attachments. The skimming attachments are designed to blend with the rest of the machine so become familiar with ATMs you regularly use.
Don't give personal or card details to persons that initiate a call to you saying they are from a trusted source like your bank - tell them you will call them back and don't call them back on a number they give you.
Keep your mail box secure - thieves can target your mail to get new pin numbers or cards sent from your bank.
Destroy any pin numbers received in the mail before putting in the rubbish.
Always check your statements for any suspicious transactions.
Inform your credit card provider immediately if your card is stolen, lost or if you notice any peculiar happenings or unknown transactions on your account.
Sign your card immediately upon receiving it and keep your PIN secure.
Don't make your PIN something that can be guessed - eg: your date of birth.
Check your credit file on a regular basis to see if there are any credit checks that you didn't initiate - ie: fraudsters making loan applications in your name.
Ensure you have up to date protection on your computer to prevent malicious programs like key loggers - programs that record everything typed into your computer and then send this information via the web to the thief.
Make your passwords more secure. Generally the longer your password the more difficult it is to hack. Password hacking programs use enormous lists of real words to try to find passwords. To make it harder to crack your password, experts recommend not using real words. If possible, use upper and lower case letters, numbers and make it as long as possible.