You've just finished up a long day of shopping, rushing through numerous stores to get all your errands complete. After you've unloaded your packages and tucked away your receipts, you notice your credit card is gone. Worse, you can't recall what store you were in last and, aside from that, it's been hours since you last used it.
Credit card fraud has long been a problem and it's one that continues to grow. If you fall into the unfortunate position where your credit card has been lost or stolen it is important to take quick action as soon as you notice the card has gone missing.
Ways Card Information is Stolen
A lot of the time it is difficult to trace where a card theft occurred. It could be the vendor was hacked, a card was skimmed, a point-of-sale machine was compromised, a third party breach or an online merchant was exploited, to name a few. Being victims often never find out where their plastic was compromised, it is important to focus on being vigilant.
In the event your plastic was stolen, you can be sure unlawful use will likely be attempted or your card information will be sold on the black market. Even if the card is truly lost and no one intentionally stole your card, you still want to protect yourself and assume the information on your card will be used unlawfully for illicit purposes if your plastic fell into the hands of a dishonest person.
If it does happen, be proactive. Taking immediate action is key because you can significantly reduce any potential damage and minimize the risks associated with credit card loss.
Call Your Creditor/Bank
As soon as you notice your credit card is missing and/or something looks amiss on your account, call your creditor to inform them of what has happened. It's advisable to do this immediately upon discovery because the longer the delay, the worse the situation can become. As long as the card is reported missing, any charges made after that documentation has been made are not the responsibility of the cardholder. In the United States, the card owner is only liable for $50 of unauthorized use of their plastic. If the credit card hasn't been reported lost or stolen, any charges made may be the responsibility of the cardholder. If you live outside the United States, check with your local laws to see what you may or may not be responsible to pay for in the event a theft occurs.
Inform Credit Reporting Agencies
The next step is to call the three major credit reporting agencies, Equifax, TransUnion, and Experian, to let them know about the loss or theft. When you call, ask each agency to place a Fraud Alert on the credit cards that were stolen or lost.
This way there will be an immediate notification that will show up if an illegal attempt is made with the credit card. In addition by contacting these agencies rapidly, this helps keep the integrity of your credit scores and credit history intact.
Retrace Your Steps
Retracing your steps is important, but it is more important the first two steps be taken first. If you backtrack where you've been it is possible your credit card will be found or someone turned it in, however this may not mean that someone hasn't made an imprint or copied the number down. You'll have the security in knowing you have your credit card back, but it's still a good idea to request the creditor to issue a new account number and credit card - just to be on the safe side.
Send Documentation of Loss or Theft in Writing
After you've done the reporting to the proper banks and credit agencies, follow up this report with documentation in writing so all is in order and there are no questions if any future issues arise due to the loss or theft of the credit card.
Even if you've had a helpful conversation, always back up the reported theft or loss with a letter which includes all relevant information, who you spoke with and the details of that conversation. Paper trails are always important because they may be needed at a future date if any subsequent troubles arise.
Examine Credit Statements
It is a good practice to always carefully examine credit card statements and on your online account, however, it is even more important after a card goes missing. This way you can monitor any unusual or strange activity that may be showing up on your account. If something seems amiss, you can immediately report the activity once you see it showing up on your statement or online account. If you do find charges made that you did not make, be sure and report them immediately and follow up in writing including the date you reported the card as lost or stolen.
Other Important Steps to Take
It is important to be proactive before your card is lost or stolen. Keep a running list of all active accounts in a safe place this way you always have your card information available in case one goes missing. Be sure and note down all account numbers and expiration dates. It is also a wise idea to maintain a photocopy of each credit card as well because it is much easier to report a loss if you have all the relevant information on hand when you file the loss report.
Credit Card Fraud is Big Business
According to statistics, approximately 31.8 million consumers in the United States alone had their cards breached in 2014. This figure more than tripled when compared with the numbers from 2013. 3 Card fraud is a global problem and, while most of the world's credit-related fraud occurs in the United States, it has a ripple effect on other countries because thieves tend to use the cards across borders.
The higher percentage of card theft in the United States is attributed to creditors not using EMV chip technology (most of the world has long adopted this technology) It wasn't adopted early on in the U.S. due to the strong protective "real-time" measures in place). In 2015, EMV technology had started to be adopted in the U.S., but transition has been slow. 4
It is anticipated EMV adoption will continue throughout 2016 and 2017 as banks and merchants make the change (penalties and shift of responsibility will occur if merchants do not comply and upgrade their machinery to be able to read the EMV chips). The EMV chips make it more difficult for thieves to use the information they've stolen. However, experts predict credit card fraud will still be a global problem for years to come.
Experiencing credit card loss can be nerve-wracking, but being proactive, establishing defensive measures and complete documentation will help safeguard both your financial and credit health.
[ Related Reading: Missing Valuables to Consider if Your Wallet is Stolen ]