online fraud

Online Fraud and Your Checking Account – How to Minimize Credit Card Fraud

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Prior to the 2016 Christmas holiday, I received a notification from my credit card company that they were tracking some suspicious card activity on my account. I immediately logged into my account and found over $500 in unauthorized charges being made for everything from household decorations to shoes. I contacted the online fraud department and confirmed their suspicions. They immediately closed down the account and issued me a new card, then credited back the unauthorized charges. I had just become a victim of online credit card fraud.

If credit card fraud is a concern for you, here are a couple of tips on how to minimize credit card fraud.

 

 

Online Fraud and Your Checking Account - How to Minimize Credit Card Fraud

 

 

Don’t Use Your Check Card for Online Purchases

As online fraud becomes more and more prevalent it’s important you take whatever measures you can to be sure your accounts are safe. One of the practices I developed many years ago was that I never make online purchases with my bank card – checking or savings. My perspective is simple.  I don’t want anyone other than me having access to my bank accounts.  

In addition, when credit card fraud takes place, it could take days for your financial institution to investigate the fraudulent activity. During that time period, the money that was withdrawn from your account may not be available for use. Obviously, credit card fraud can take place with any credit or debit card, but why expose your checking or savings account any more than you have to.

As discussed in Filling The Pig – In 4 Steps, I recommend simplifying the number of credit cards you have down to one, for emergencies. However, you could also leverage this credit card to pay for any online purchases.  A single credit card will not only allow you to diligently keep track of your online purchases, but it also keeps your checking and savings account safe.

 

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Set Up an Alert on Your Credit Card

Some credit card companies will allow you to set up a transaction alert.  A transaction alert is a dollar amount threshold you specify to receive an email or text notification when charges made to your card are greater than the threshold.  For example, if you set a threshold of $10, then you will receive an email/text notification each time a charge is made greater than $10.  The transaction threshold for my credit card was automatically set up for $500.  This is why I never received notification for the individual fraud transactions which were less than $500.  Transaction alerts are another way of minimizing the potential impact of credit card fraud. Check with your credit card company to see if they provide transaction alerts and if they do find out what the current threshold limit is.

 

I have no doubt that as more and more individuals purchase products online, credit card fraud will only continue to become more prevalent. Use these two tips to protect your checking account and minimize credit card fraud.

 

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Online Fraud and Your Checking Account - How to Minimize Credit Card Fraud

Kevin is the owner of FTP and an author of the personal finance book series Filling The Pig. He uses his own past successes with debt, saving cash, investing and running his own home based businesses to teach others about Creating a Lifestyle of Opportunities.

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