5 things you should never do with your credit card

5 things you should never do with your credit card

Did you let your credit card out of your sight at a restaurant recently? That’s a no-no and one of five things we all do that can lead to credit card fraud.

Colin McConnell / Toronto Star

Robin Dwarka , a self employed video editor, was recently the victim of credit card fraud.

By: Madhavi Acharya-Tom Yew Business Reporter, Published on Sun Mar 27 2011

Robin Dwarka doesn’t let his credit card out of his sight when making a purchase at a store or paying a restaurant bill. Nor does the 40-year-old self-employed Toronto video editor share his PIN number.

But a few weeks ago, his bank called because it noted some unusual charges to his Visa card. Someone had been doing a little online gambling at 4 a.m. on a recent morning, spending $380 on his card to pay for it.

“(The bank) asked if it was me and I said: ‘No, it wasn’t,’” Dwarka said. “Needless to say, I wasn’t happy.”

Dwarka certainly isn’t alone. Fraudulent credit charges add up to about $400 million a year in Canada.

That’s a tiny fraction of all credit card purchases, but if the card that was compromised was yours, the whole experience probably left you looking over your shoulder. Maybe you let your card out of your sight in a store, restaurant, or gas station. Maybe you sent credit card information by email to book a holiday, or gave it out of the phone.

Dwarka’s story ends well, thanks to the bank’s vigilance. The Canadian Imperial Bank of Commerce reversed the unauthorized charge, cancelled Dwarka’s card immediately, and issued a new one which arrived within a week.

Dwarka has his suspicions, but can’t be sure how thieves got hold of his card and the PIN number.

“You try your hardest to keep you pin number hidden and you don’t lend your card, but still you get people scamming you,” he said.

Nearly one-in-four Canadians has been a victim of credit card fraud, according to a recent survey by Visa Canada. Credit card companies are quick to cover the losses – but in return ask consumers to take some basic steps to safeguard their cards and their personal information.

Here are five ways to safeguard your credit card:

• Don’t lend it to anyone. It may seem like an easy way to help out a family member or friend and in most cases it is, but it compromises your ability to keep your card safe. If that person racks up a big bill on your card, or holds on to the number and the three-digit security code after giving the card back to you, you may be on the hook for the charges.

Don’t share your PIN number. “As we move to chip and PIN technology, it’s critical that consumers protect their PIN at all times and not write it on a slip of paper in their purse of wallet,” said Gord Jamieson, head of payment system risk at Visa Canada. If you can’t remember your PIN go into your branch and choose a new one – just make sure it’s not too easy (no 7777s, please) and can’t be easily deduced from identification in your wallet, such as your birthday.

Never let the card out of your sight when making a purchase: This is a tricky one. At restaurants and the gas station, staff typically carry your card away so they can swipe it, then return with the receipt for your signature. But those few minutes may be all a thief needs to swipe your card through a skimming device that copies the information. The shift to chip and PIN technology means that more merchants are installing portable wireless terminals so you can input your PIN yourself.

Do not send card information by email or text: Most email and text isn’t secure and this information could be easily stripped out of your correspondence by hackers. If they glean your card number and expiry date, along with the security code on the back of the card, they’ve got what they need to go shopping online. Add to that your name and address and it’s a recipe for identity theft.

Do not give card information over the phone if you didn’t initiate the call. These typically appear to come from your bank or financial institution and tend to have some urgency around them, something like, ‘Your account has been breached or it will be cancelled, so please give us information to verify your account.’ Fraudsters have been known to ask for everything from your mother’s maiden name to credit card and banking information. “You name it, they’ll ask for it,” Jamieson said. Never respond to these requests. “The bank would never call and ask for those things. Ask where they’re calling from and then hang up and call back,” he said.

As for the dos, be sure to closely examine your monthly statements for irregular and unauthorized transactions and call promptly about items that you don’t recognize.

The same advice – never share or write down your PIN and check your monthly statements carefully – goes for debit cards. These are less susceptible to fraud, but unauthorized transactions on debit still reached $119 million in 2010, according to the Interac Association.

When you dispose of receipts and statements, shred the information to make sure that no one can steal it, Jamieson said. “People will go through your garbage and pull out information to perpetrate identity fraud.”

Ultimately the best thing for credit card customers to do is be vigilant, Jamieson said. “We ask our customers to watch what is happening. If something looks suspicious, be careful and report it.”

Also read:

Have a comment, or a credit-card fraud story? Send to macharya@thestar.ca