Lost or Stolen Credit Card

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Your Credit Card Is Missing – Here’s What’s Next

Sep, 23rd 2016

We’ve all had that moment. We go to reach for a credit card to conclude a transaction and – wait, it’s not there in its usual spot. You start frantically digging through pockets, wallets and purses, hoping that it’s simply in a different location. Then reality strikes, and you experience the helpless feeling that comes when you realize that something vital is missing.

In some cases, you left the card at home or forgot to take it back when you gave it to a merchant, and can retrieve the card with little trouble. In other instances, it’s either lost, stolen, left on a counter or sticking out of an ATM, and has vanished.

The bottom line in the latter case: she’s gone. And like Hall & Oates sang, you better to learn how to face it. Because what happens next goes a long way toward mitigating the damages that can arise from your misfortune.

Each year, 14 percent of card fraud comes from lost or stolen cards, according to federal trade statistics compiled by the U.S. government. The bulk of fraud comes when someone purloins your card number, either getting it through an online transaction (45 percent of fraud) or counterfeiting it through a skimmed number (37 percent). 

In all cases, that means billions of dollars in merchandise is stolen each year, and it’s a major headache for anyone affected by it, including you, the bank, the merchant, and the credit card network. While the implementation of EMV chips in your credit cards is expected to cut back on transaction fraud at the point of sale, it’s not protection for online and telephone fraud, and not even foolproof at the point of sale, where many businesses still require a swipe or input numbers manually.

Most credit card fraud activity takes place in the wee, small hours of the morning, typically between 2 a.m. and 6 a.m., when card holders are sleeping and not monitoring their spending activity. Christmas Eve and Christmas Day are major holidays for fraudsters, and mobile channels are more than susceptible to fraud than other charging vehicles. 

Most incidents of mobile fraud in 2014 were related to credit cards. In fact, credit cards were used in 53 percent of mobile commerce-related frauds.

PICK UP THE PHONE

Your best defense is fast action. When you discover that your card is missing, immediately call your credit card company and report your lost or stolen card. Most have 24-hour customer service and toll-free numbers to accommodate any and all situations. Federal law states that you are not liable for any unauthorized transfers that occur after you report your card missing within two days.

However, thieves act fast as well. Often your first sign of trouble is when you receive call from your credit card company flagging unusual activity, or you go to pay and discover a missing card. But, again, if you can squelch the credit card within two business days, your maximum liability is $50.

Unfortunately, if you’re highly distracted by work, family or other issues, and not paying attention to activity, the price of inattention rises. This is particularly true with debit card transactions, which are directly removed from your bank account. If you discover charges on a debit card that are odd, and it’s more than two business days after the transaction, you can be on the hook for as much as $500. It gets worse – on the 60th day after your statement is sent, all bets are off. All the money taken from your account, and even money in accounts linked to your account, can become your responsibility to fix.

Don’t assume that one phone call to the card issuer completes your duty. After reporting the card missing, send a follow-up email and certified letter with a return receipt request attesting to your hacking. Include such information as your account number, when you first noticed any issues, and when you contacted the company regarding the loss. It’s also a wise idea to go back through your card statements at this point and make sure there aren’t any odd transactions that you may have missed on the first go-round.

Keep in mind that you need to send your letter to the billing department, which may have a different address than the corporate headquarters. When in doubt, ask the card company.

Once your card has been reported, the card company will issue a new card number. Your credit will not usually be negatively affected, although if the card thief went wild with charges in a short span, it may take some work and letters from the credit card company to clear your good name with irate merchants. 

In some cases, homeowners or renter’s insurance may cover thefts related to credit card fraud. Check your policy, and it may be wise to add such coverage if you’re a frequent credit card user. However, don’t give out information to anyone who contacts you over the phone or e-mail offering such fraud protection, as there are well-known scams related to card fraud insurance. Instead, contact your insurer or broker directly to check if such coverage is available.  

SOME PRECAUTIONS

In a world filled with skimmers, scammers and out-and-out thieves, protecting your card number and the physical plastic is becoming increasingly challenging.  But keeping a close eye on your account activity and being cautious with your card number is the best way to prevent issues.

Here are a few tips:

  • Don’t give out your numbers to anyone that you did not contact yourself. Phone callers can sound convincing, but many are contacting you from boiler room operations with phony sound effects simulating a busy office.
  • Open your statements promptly and examine the charges. It’s a good idea to save receipts from any transactions and compare them to actual charges. A simple dollar difference here and there adds up.
  • Never write down your card number or personal identification number (PIN) on envelopes or other materials you’ll be discarding, and always cut up old cards into tiny pieces.
  • Don’t sign blank charge slips and draw a line on spaces for tips and other charges on receipts. It’s not a bad idea to initial the total charge.

Sensible use of your credit card means paying attention each time you use it and not giving out this vital information to anyone that is soliciting you. It’s just common sense, and a little caution and careful record-keeping can spare you a lot of financial grief.

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