Who Is Liable for Credit Card Fraud?  

Credit card fraud is a common type of identity theft involving using a person’s credentials to buy goods and services illegally. Although financial institutions and credit card issuers have adopted measures to curb this menace, fraudsters continue adopting new ways to scam their victims. Fortunately, there are regulations formed to assist credit card victims in sorting out their losses. Besides, knowing what to do when your personal details are violated is crucial.

What are the Punishments for Credit Card Fraud?

Typically, credit card fraud punishments depend on the offense’s extent and the facts of the crime. For instance, if your credit card is not used after being stolen, the case may be treated as a felony or misdemeanor. However, sophisticated cases such as the use of counterfeit cards are usually felonies that attract long prison terms.

Credit card fraud involving the theft of a credit card number or the card usually attracts a sentence of one to five years. However, this is quite different from identity theft since the crime attracts a sentence of ten to twenty years. Additionally, the fraudster may receive additional prison time if found with their trade tools. You can also consider clicking on this article for more information about jail terms.

What should Credit Card Fraud Victims do?

Suppose your credit card is stolen in the U.S. In that case, the cardholder’s liability limitation is $50, irrespective of the charges levied on the card by the unsanctioned user, according to federal law. Since electronic fraud is quite common nowadays, the cardholder usually has no liability to the credit card company if the card is stolen and you report the case before any charges. This is according to federal law.

Moreover, implementing zero liability policies by many companies also protects their customers from fraudulent charges. This is usually stipulated in your card’s terms and conditions. It is crucial to immediately report to your credit card company if your card is stolen or goes missing. This early notification is usually important in various ways, including:

  • Verifying the occurrence and location of the fraud
  • Closing the account to avert impending fraudulent charges
  • Getting rid of the unsanctioned charges from the credit card account
  • Issuing a new account number and a card

Lastly, contacting the three main credit reporting agencies is essential to get a credit card report. This helps ascertain that no other fraudulent transactions were made.

Ways of Preventing Credit Card Fraud

Since many people prefer using plastic money nowadays, the number and extent of credit fraud cases have significantly increased. Unfortunately, many individuals need to pay more attention to basic tips to help avoid these cases. The following are basic ways that can be helpful:

Enhancing your Card’s Safety

Keeping your cards in a place that others cannot access is usually the main step in avoiding credit fraud cases. As you get issued with your credit card, ensure its envelope or credit card kit is untampered. Since you will have to move around with it in many places, consider keeping it in a tiny wallet to secure the card from pickpockets or snatchers. It is also crucial to remember to put away the card immediately after every purchase, since fraudsters may store their digital imprint by taking snapshots using smartphones.

Avoid Making Credit Card Details Public

You should always be aware of potential phishing threats and scammers. The credit card number and other important details linked to the card should never be sent through text messages or the phone. Typically, credit card scammers pretend to be lucrative business officers or new service providers as they trick unsuspecting victims into providing private details about their cards.

Since you may accidentally leak your credit card details, one way to mitigate this fraudulent trick is to memorize and change your PIN frequently. Fortunately, many credit card issuers and financial institutions allow their clients to change their PINs online from the comfort of their homes.

Use Strong Passwords

Nowadays, credit card issuers usually store their numbers to enhance one-click purchases and ease of access. You can strengthen your credit card password by combining lower and upper case characters with numbers. Avoid using passwords that someone can easily guess, such as your date of birth or the current year.

Moreover, it is essential to memorize it since writing it down on paper can be risky since it can fall into the wrong hands. Other ways of avoiding credit card fraud include being cautious while shopping online and reporting your stolen or lost card immediately.

Apart from credit card owners, other parties also have a role in preventing credit card fraud. For instance, the roles of credit card companies include:

  • Providing automated data control
  • Installing fraud prevention and detection software
  • Implementing strong authentication measures
  • Sharing evolving threat vectors and known fraudsters

On the other hand, banks and financial institutions should also play their part. Their roles in preventing credit card fraud include:

  • Enhancing the protection of their clients as they undertake self-service activities
  • Installing protective gadgets like CCTV systems
  • Protecting the cards and banking assets from unauthorized persons

Many people prefer using plastic money instead of cash. Although credit cards have many benefits, they are also subject to fraud. It is essential to remain vigilant to avoid becoming a credit card fraud victim.

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