It has happened to me before, it will surely happen to me again. No matter how vigilant I am in protecting my credit card information, someone, somewhere, will somehow gain access to my credit card information and run up charges on my account. It is another form of identity theft. They are
pretending to be me as they enjoy the fruits of my credit history (as meager as that might be) and adding to my debt load.
To be certain, depending on the card, I won’t be held responsible for fraudulent charges. The legal limit is $50 if I regularly review my credit card statement and notify the credit card company of anything I did not authorize within 60 days of the statement. However, most card issuers waive the $50 if I promptly notify them.
Now there is a slight difference between someone gaining access to my credit card information and having possession of my actual card. If they have my card, I am obligated to inform the issuer as soon as I notice. If I don’t notice the missing card, but then notice fraudulent charges, I must notify within 60 days to avoid liability for those charges. If they have access to my information, but I have possession of my card, then I am liable for nothing, even if I don’t notice the problem in the 60 day period. In that situation, if the merchant obtained an actual signature, the credit card issuer is on the hook. If it was a phone or online charge, the merchant who took the information without verifying is liable.
Regardless of my liability or lack thereof, it is still incumbent upon me to monitor my credit card. This is where the instantaneous wonder of the Internet comes to my rescue. Most, credit card issuers make your credit card statement and current charges available online. It take nothing more than a few mouse clicks, a few identity verification questions, and you can see what charges are showing up on your credit card account.
The last time I had this happen, I was in Miami on business, but took my wife to celebrate our 12th wedding anniversary. One day, while I was in seemingly endless meetings, my wife went downtown to an outdoor café for lunch. The only time she used my credit card. The bill came and the waiter left with my credit card and promptly returned with my card and the bill for her signature. She thought nothing more about it. After returning home later that week, I logged in to check my balance and was surprised to see several charges for pizza and gasoline. My card was in my possession, so it was easy to surmise that the waiter had skimmed the information and created a fake card. My suspicions were confirmed when I immediately called the credit card issuer and they informed me that the charges were made either by swiping the card at the pump or ordering the pizza over the phone - there was not a person viewing the card or verifying "my" identity. Of course, the charges were removed from my account, the number immediately cancelled, and a new card was issued. No pain, no fuss; but, you have to be proactive in watching for unauthorized charges.
I have also learned to keep an eye on my credit card. Don’t let it out of your sight. One thing that has long irritated me is the failure of US merchants, particularly the restaurant industry, to adopt the “table top” mobile card readers used across Europe. In Europe, the waiter comes to your table and swipes your card in front of you and prints out the receipt. The card never leaves your presence! Avoid letting your credit card out of your sight even for a few seconds – that’s all it takes to have an illicit card reader pull the information from your card and hijack your account.
Till next time – be aware and stay safe!