Credit card fraud: who foots the bill?

How difficult is it to get personal information from the owners of 5 million Philippine-issued credit cards currently out there? It just takes a name, a credit card number, the bank’s name, an ID with a signature and anyone can have a shopping spree charged to your sanity.

It’s not just the Internet that made this all too easy for anyone with a fraudster’s gene in his system. The urge to have everything at the snap of the finger has made a lot of us too lazy, too lax and too careless with our personal information. And don’t think that you’re free of high tech scammers just because we are in the backwaters of the Philippines. The best hackers were born here :-/

Sometimes, even those that are uber careful get victimized. I know a finance professional who almost fell off his seat when he got a call from his credit card company confirming several hundred thousands of purchases in SM Bicutan. He doesn’t even know how to get there. Good thing the credit card company flagged the transaction and called him immediately. The scammer in the gasoline station must have made an extra swipe and got all his credit card information, transferred them into a new credit card and presto – the gas boy’s wallet just got bigger.

Our personal finance story today says forewarned is forearmed. But what if the deed has been done. Who pays the bill now?

YOU. Especially if the identity theft was your fault. I know, I know. That’s a top of the line “ouch” so be extra careful.

Here’s a tip: you’ll increase your chances of a reversal of charges if you show that you were careful with your credit card information, that you reported it immediately, and that you were diligent in getting a police report pronto. Insist that the bank make a full investigation. It’s still possible to reverse charges.

This is why my personal bias is for a credit card company that has the capability to flag fraudulent transactions immediately. Be careful because not all credit card companies do that.

Since I’m online most of my waking hours, I also make it a habit to carefully check my credit card accounts to see if there are any transactions that look alien to me. It also follows therefore, that I keep all my charge slips so that I can compare them with the charges on my credit card bill.

I live with an information security expert and he says while there are anti-spam solutions and firewalls out there to protect people from identity theft, there is no better defense than the right attitude about guarding personal information. I mean, you can buttress your computer with all these programs and guard your credit card inside Alcatraz, but if someone calls pretending to be from Visa or Mastercard investigating credit card theft, and you give your credit card number – you won’t be able to blame anyone but yourself.

So be paranoid. And be safe.

Interesting moments: A man dressed as an ancient Chinese official drags a credit card “slave”, or a consumer in credit card debt, as they take part in a demonstration calling for the government to pass a law to help people oweing money to banks, 02 June 2007, in Taipei. The group claims there are more than 600,000 credit cards slaves in Taiwan, suffering from credit card high interest rates and high repayments.

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