How To Prevent Credit Card Fraud: 10 Essential Steps

Can You Stop Scammers From Using Your Credit Card?

Credit card fraud — or just “card fraud” — includes any unauthorized use of a credit or debit card to fraudulently obtain money or property. It was the most common type of identity theft reported to the Federal Trade Commission (FTC) last year[*].

Even if your physical card hasn't been stolen, you could still be at risk as scammers can often find leaked stolen credit card numbers on the Dark Web.

In this guide, we'll explain how you can protect yourself against credit card fraud and what to do if you've been a victim.

10 Ways To Prevent Credit Card Fraud

1. Understand when your card is at risk
2. Protect your physical credit card
3. Only transact on websites using SSL
4. Shop with reputable online retailers
5. Be cautious of phishing emails, texts, and calls
6. Look for the warning signs of a scam website
7. Keep your devices safe
8. Protect your mail and shred sensitive documents
9. Keep a list of your credit card accounts
10. Use your credit card (not debit card)‍

1. Understand when your card is at risk

Criminals have more ways than ever to get access to your physical credit card or credit card numbers.

Whereas your Social Security number (SSN) might be easier to protect, credit card numbers are more easily accessible. Thieves can steal your credit card numbers from unsecure websites, using phishing attacks, or other deceptive credit card scams.

Once they have your numbers, they can accumulate debt, open new accounts or request new cards, or commit loan fraud. Even worse, you could spend years and thousands of dollars trying to repair your credit and restore your identity.

The best course of action is to stop fraud before it happens. Here are some ways to detect credit card fraud:

• Physical theft: Criminals will often steal your physical credit card from your wallet or purse. A stolen card gives them everything they need to make online purchases or “clone” a new card.
• Mail theft or “dumpster diving”: Thieves will look for documents that display card details, such as credit card statements or new card offers. If your mail goes missing or stops arriving, you could be the victim of mail theft or a change-of-address scam.
• Phishing attacks: Scammers will send phishing emails, text messages, or phone calls impersonating your bank or lender and dupe you into disclosing financial information.
• Malware, spyware, and other viruses: Some phishing and other cyber attacks include links or attachments that infect your devices with malware. These viruses scan your device for your financial information or use a keylogger to record your key strokes.
• Skimming and shimming at ATMs: Credit card “skimmers” are small devices that are installed on ATMs. When you use your card, it records your numbers and PIN and sends them to the fraudster. These devices are commonly found at gas stations and other places where pin pads are out in the open.
• Intercepting Wi-Fi: Public Wi-Fi networks are notoriously easy to hack. A scammer can use a man-in-the-middle attack to intercept your account numbers and passwords when you log in.
• Data breaches and other hacks: Millions of credit card numbers and personal information have been leaked in recent data breaches. In some cases, these end up for sale on the Dark Web for as little as $17 [*].
• Shoulder surfing: Anytime you use your credit card in public — such as at ATMs, restaurants, or on the phone — a scammer could surveil you and write down your numbers.

📚 Related: Did Scammers Use Your Credit Card Numbers Online? Do This →

2. Protect your physical credit card

While criminals have found advanced ways of committing credit card fraud, physical card theft is still pervasive.

With your physical card, a thief can make fraudulent purchases, “clone” the card into a new one, or use the numbers for other types of scams and fraud.

To keep your credit card safe, remember to:

• Use a chip reader. Whenever possible, use a chip reader, as they’re more secure. Modern credit cards use EMV chips to stop scammers from being able to “skim” your card’s magnetic strip.
• Protect your wallet or purse. Keep an eye on your wallet or purse and never leave either unattended. If you carry your wallet in your back pocket or your purse behind you, you might want to consider moving them in front of you to avoid getting pickpocketed.
• Carry fewer cards with you. Having too many credit cards means you’re less likely to notice when one goes missing. Minimize the number of cards you carry on your person.
• Ensure transactions happen within your view. Don’t let servers at restaurant or store employees take your card. It’s too easy for credit card fraud to happen when you’re not around.
• Don’t read out your credit card numbers in public. Wait until you’re in private before giving out your numbers on the phone. Anyone can listen in and write them down.

3. Only transact on websites using SSL

According to data released in March 2022, credit cards and mobile wallets were the most popular payment methods for e-commerce transactions [*]. That makes e-commerce websites a huge target for scammers.

Digital payments aren’t always fraud-free, but you can protect yourself by only sharing personally identifiable information (PII) on “secure” websites. Such sites use encryption to stop scammers from hacking them and getting your credit card numbers.

How can you tell if a site is secure?

1. Look for a padlock symbol by the URL. You will see a padlock on the left side of your browser's address bar on safe websites. If there's no padlock, you're on an unsafe web page. Criminals can easily view or intercept any communication on these web pages, putting you and your personal information at greater risk.
2. Check for “HTTPS” (not “HTTP”). In this case, the extra “S” stands for secure. Secure websites use what is called “Secure Sockets Layer (SSL)” — a security protocol that uses “tokenization” to scramble your data. This means that even if the site is compromised, your credit card information won’t be at risk.

Unfortunately, scammers have started to use “secure” sites that mimc legitimate websites. One study found that over 80% of all phishing websites are protected by SSL [*].

4. Shop with reputable online retailers

It is estimated that online retail fraud losses would have reached $380 million in 2022 [*].

Even the most secure sites can fall victim to hacks or fraudulent activity. But reputable businesses like Walmart, Amazon, and Apple, usually have stronger security than smaller brands.

If you want to use your credit card to buy from an unknown retailer, start by searching for them on the Better Business Bureau (BBB) website. This will alert you to any reported fraud from this company and if they’re “trusted” by the BBB.

But the BBB isn’t the only resource to check for retailer legitimacy:

• Obtain a physical address. An authentic organization wants customers to discover and enter its physical and online stores. Conversely, criminals won't risk listing a legitimate location. If you find a postal address, validate that information with the U.S. Postal Service.    
• Check if the contact number is working. You can expect to find a working phone number on most business websites. With the rise of multi-factor authentication (MFA), a phone is now a standard identity verification tool. If the number returns an error message or no dial tone, you might be dealing with a bogus page.
• Look for an active email address. Most bonafide companies have email addresses for customer support. If you do find an email address, send out an initial query. A reputable store will be happy to provide email verification of its authenticity.
• Do a Google search for “Company name + scam/fraud”. See if anyone has written reviews, social media posts, or blogs about being scammed by this company. If someone has already been the victim of credit card fraud, you should find out.
• Beware of account signups without ID verification. Most companies will combat any potential fraudulent activity by asking customers to sign up for an account before they can make purchases. If you’re able to proceed without first creating an account, this lax in security may be the sign of a scam web page.  
• Look for third-party reviews. Find reviews from previous customers on sites like Amazon, as well as on industry news sites and third-party sources that monitor websites for internet safety. Unfortunately, not all reviews are genuine.

If you think you have encountered suspicious activity on a business page, report it to the BBB to help prevent further instances of fraud.

5. Be cautious of phishing emails, texts, and calls

Phishing scams are among the most common ways criminals try to steal your identity. Fraudulent messages or emails can trick victims into clicking on links or unwittingly sending their credit information to the wrong people.

In February 2022, criminals crafted a series of “exclusive rewards” for Costco and T-Mobile customers [*]. The messages included official logos and branding to entice customers with free $100 gift cards.

Because the emails spoofed legitimate brands, victims were more likely to be trusting.

If you receive an unsolicited email that includes a link or asks for your financial information, look for the signs that point to a scammer.

• Incorrect “From” email addresses. Click or hover on the sender’s name to see their email address. If this doesn’t match the company name, it’s a scam. (Also look for similar domain names like “Walmrat” instead of “Walmart”).
• Using an unofficial email account (like Gmail or Yahoo). Check to see if the sender is using a free email address. Real newsletters or offers won’t use a Gmail or Yahoo account.
• Poor spelling, grammar, and layout. Phishing scams often include strange spelling errors and grammar. This is a major red flag that you’re dealing with a fraudster.
• Includes links, attachments, or QR codes. Never click on links or download attachments in unsolicited emails or texts. This is one of the ways that scammers get you to visit phishing sites or infect your device with malware.
• Uses threatening or emotional language. Fraudsters will threaten or present you with time-bound offers in order to have you quickly give up your card details. Emotional language is one of the hallmarks of a social engineering attack. Take a moment and check the email for these giveaways before you take action.

📚 Related: Can Someone Hack Your Phone With Just Your Number? →

6. Look for the warning signs of a scam website

Established e-commerce vendors want to provide enjoyable experiences for their customers. So the design on most modern retail sites focuses on easy navigation.

By comparison, many scammers use nebulous websites, flashy ads, too-good-to-be-true offers, and aggressive popups to con people into sharing their credit card data.

Some scam sites will also include an excess of hyperlinks designed to lure victims to unsafe parts of the internet. Others will impose a mirror website over the top of a legitimate site, which can install malware on your computer.

Don’t hand over credit card numbers or any sensitive information on websites that show these red flags.

7. Keep your devices safe

Even if you use a secure webpage to make online purchases, that doesn't shield all transactions. Hackers can intercept electronic transfers as they transmit to a safe business server.

On top of not using public Wi-Fi, consider:

• Using a Virtual Private Network (VPN). VPNs extend a private network across public systems, offering more privacy and security features. It will protect your IP address and also encrypt electronic information transfers.
• Sign up for a password manager. By doing this, you will have strong unique passwords for any important online account. It also saves you the hassle of remembering multiple passwords across websites.

Have you wondered how easy it is for hackers to get into your Wi-Fi network? In a social experiment, ethical hackers taught 86-year-old Alec Daniels how to set up a phishing email, hack a public Wi-Fi network, and intercept web traffic. It took him all of 17 minutes to successfully perform the hack [*].

8. Protect your mail and shred sensitive documents

While credit card skimmers and Wi-Fi hacking are legitimate dangers, many credit card criminals prefer time-tested scams like stealing your mail or scavenging your garbage.

Sometimes, scammers will even use a change-of-address scam to reroute your mail to their address. Then, they’ll order a replacement card purporting to be you.

Make sure you keep your mail and physical documents safe by:

• Going paperless with your account statements and bills.
• Reducing the number of documents you receive in the mail that contain your credit card information.
• Collecting your mail daily (or using a secure mailbox).
• Shredding all sensitive documents before throwing them away.

9. Keep a list of your credit card accounts

With credit card fraud prevention, speed matters. The quicker you discover a vulnerability (or compromise), the faster you can shut down scammers.

Aside from creating and storing strong passwords, a password manager can also store card information.

Having a complete list of account numbers ready will help your credit card company confirm your identity and quickly respond to a threat.

Also save your credit card issuer’s contact information. Many have secured methods of communication that can help you resolve any identity theft issues or credit card fraud. If you can, keep both an electronic and paper version of your account data.

10. Use your credit card (not debit card)

You might think this is an odd step to take when you want to prevent credit card fraud. But while it might be bad to have too many credit cards, it’s better than a surplus of debit cards. 

Credit cards have built-in compliance standards that protect all consumers. The chargeback process and point-of-sale systems deter instances of fraud and unauthorized charges. 

Also, all credit cards now include EMV chips — which stands for Europay, MasterCard, and Visa. These chip cards create unique codes for each transaction, making the cards (and their connected accounts) much more resilient to digital fraud than cards that only have magnetic strips.

Also, contactless payment methods like Apple Pay are considered to be safer than physical cards. Neither Apple nor your device will send merchants your credit card number when you make a payment.

Were You The Victim of Credit Card Fraud? Do This, ASAP

• Contact the fraud department of your credit card issuer. Close your accounts and get a new card. Point out which fraudulent transactions should be expunged from your account.
• Freeze your credit immediately. A credit freeze rejects all loan applications until unfrozen and can prevent criminals from doing serious damage to your credit score. To set up a credit freeze, contact each of the three credit bureaus — TransUnion, Equifax, or Experian. Or, use Aura’s one-click credit lock to instantly lock and unlock your Experian credit file.
• Review your credit report for fraudulent activity. Request a free credit report at AnnualCreditReport.com. Check to see if anyone has accessed other accounts or applied for credit under your name.
• Regularly check your credit report and bank statements. Scammers are almost always after your financial accounts. Check for the warning signs of identity theft — such as strange charges on your bank statement or accounts you don’t recognize. An identity theft protection service like Aura can monitor your credit and statements for you and alert you to any signs of fraud.
• Contact any company where the fraudulent card was used. Ask for their fraud department and tell them what happened. They’ll open a case and stop the criminal from making any more fraudulent charges.
• File an identity theft report with the FTC. Use the free tools at IdentityTheft.gov. This will provide you with documentation you may need later.
• Report the fraud to your local law enforcement. If your card was physically stolen, you should file a police report for identity theft immediately.
• Reset all your passwords and enable 2FA (but not over SMS). Update your online accounts with more secure passwords and set up a password manager. Make sure you also have two-factor authentication (2FA) on your bank accounts.
• Sign up for identity theft protection. Aura’s top-rated identity theft protection monitors all of your most sensitive personal information, online accounts, and finances for signs of fraud. If a scammer tries to access your accounts or finances, Aura can help you take action before it’s too late. Try Aura’s 14-day free trial for immediate protection while you’re most vulnerable.

Do you have to pay for fraudulent purchases?

The Fair Credit Billing Act protects consumers with zero liability in cases of credit card fraud. This federal law means you won’t have to pay for fraudulent purchases made on your credit card — as long as you inform your lender or bank within a reasonable amount of time. 

Unfortunately, while your bank might spare you the worst consequences, resolving identity theft and repairing your credit is still a time-consuming process. 

Be Proactive About Fraud Prevention With Aura

With these tips, you should have everything you need to help prevent credit card fraud. Unfortunately, even the safest shoppers can find themselves in the clutches of fraud. 

Protect your devices, data, and financial accounts with 24/7 credit monitoring and real-time fraud notifications. With Aura’s digital security solution working around the clock to keep you safe, you can browse and shop online with confidence. 

Ready for ironclad identity theft protection? Try Aura free for 14 days.