Six Credit Card Scams : How To Avoid Them?


As cash transactions decline, credit cards—particularly their use online—continue to grow. This tendency was exacerbated during the Covid-19 epidemic, as increased demand for electronic payment choices influenced buying and sales habits.

Credit card use has grown, which has increased credit card fraud. Scammers seek to exploit increased familiarity with remote payment methods, growth in the number of online purchases, and an increase in the number and diversity of individuals who use the Internet to conduct formerly in-person transactions. According to Orville L. Bennett of Bridge Payday Here are six classic scams and how to prevent becoming a victim.

1. Scams Based on Excessive Charges

The target receives an email, text message, or phone call alleging that their credit card has been overcharged for some goods or service. To get a legitimate reimbursement, the target is advised to take specific procedures, including disclosing personal information.

How It Operates

While the purported overcharge may seem to be related to a product or service the scammer has previously designated as a target, it is far more probable that the scam would imitate a more standard service—a popular streaming platform, such as Netflix or Spotify—that random targets are more likely to utilize.

If the claimed overcharge is for a product or service that the target never bought or used, this may be an additional cause to pursue a refund. The fraudster may directly request personal information to execute a refund supposedly. The victim may be directed to supply login credentials for a legitimate account, which may lead to credit card details.

How to Identify It

While it is critical to be exceedingly wary of any unexpected “cold call” requesting personal information, calls from firms that have never phoned before should be viewed with particular suspicion. Any assertion that the situation must be resolved soon to get a refund or that this is the “final opportunity” to receive a refund, regardless of the mode of communication, should also raise a red flag.

When it comes to emails, a brilliant place to start is by attentively examining the sender’s email address and comparing it to other employees at the same organization. A scam address may be virtually similar to a real business’s address except for a single character. It may also imitate a legal business’s speech by rearranging words or adding legitimate-sounding phrases such as “support” or “pay.”

Any misspellings, grammatical errors, or typefaces and graphics that vary from authentic email samples are other warning flags, such as email. All media (text, photos, and logos) are included in a single image file.

What Should Be Done

The safest course of action is to hang up on a questionable caller or email without accessing any links or attachments. Consulting one’s credit card statement, calling the credit card company to verify the claimed overcharge, or contacting the firm or service in question through their publicly available customer care channels are viable approaches for resolving the issue. Never access a website or log into your account through a link in a suspicious email—always open your browser independently and enter the correct URL.

2. Interest Rate Scams

In recent years, some of the most well-known over-the-phone hoaxes have emerged from “businesses” that promise to be able to lower their target’s credit card interest rate and save them hundreds of dollars in interest.

How It Operates

A call will declare or suggest that the “business” has a relationship with credit card issuers that enables them to negotiate reduced interest rates. As is the case with many hoaxes and legitimate business solicitations, the caller may indicate that the time for their offer is short of urging the target to respond fast. Without the consideration or skepticism, they would typically use. After connecting the victim to a live operator, the fraudster on the other end will request credit card details and maybe direct payment for the purported services.

How to Identify It

Due to the popularity of this fraud, the FTC recommends considering any pre-recorded solicitations for interest rate reductions with “extreme suspicion.” Legitimate third-party debt relief organizations may provide comparable services. Still, they are seldom solicited through a cold call, and they are not permitted to charge a fee before decreasing or settling debt, so any request for money up in advance may raise red flags. Phone numbers on the Do Not Call Registry should not get solicitations like these from law-abiding businesses—another red flag.

What Should Be Done

Those interested in negotiating a lower interest rate on their credit card may simply phone the card issuer’s customer care line—which is often located on the back of the card—and talk with the company directly. In actuality, even a respectable third-party firm has little real bargaining power with a credit card issuer when negotiating prices. The safest course of action is to disregard any phone solicitations for this sort of service and to seek it independently if required.

3. Scams Relating to Arrest Phone Calls

To those acquainted with recognizing phone frauds, they may seem to be the most implausible and ridiculous. However, they may be very painful to unwary targets—which, unfortunately, is how fraudsters make them work.

How It Operates

This scam attempts to intimidate the target into using a credit card to “pay off” bogus debts, penalties, tickets, or taxes, while also providing the scammer with the target’s credit card information. The caller pretends to be from a governmental agency such as the IRS, Social Security Administration, FBI, or another government institution with suggested ties to law enforcement. 

It may even show with a “spoofed” caller ID, making it seem legitimate when it is not. To compel the target into cooperating, the call warns that they will be arrested, that a warrant for their arrest has already been issued, that legal action will be taken against them, or that they will be penalized.

How to Identify It

Genuine police enforcement or government agencies would never approach citizens in this manner over the phone. Any phone call that threatens to charge you with a criminal or to jail you immediately for failing to pay money over the phone is a scam. Additionally, it is improbable that a credible government entity would request critical information over the phone, much less during an unannounced contact. 

These scams often employ automated, pre-recorded messages that seem unusually succinct, strange in their terminology, or amateurish. They may make ambiguous allusions to “the local police” that do not suit the sort of language used by legitimate law enforcement.

What Should Be Done

While it is never a good idea to provide critical information to a cold caller, do not be swayed by calls purporting to be from an authorized figure. If you have unpaid fines, recent criminal behavior, or the like, be aware that legitimate authorities would never contact you by phone to demand payment through a credit card. Any issue may be resolved by immediately hanging up and getting the appropriate organization.

4. Scams Relating to Donations

One of the most simple yet most efficient credit card frauds, this one dupes the victim into happily providing their credit card information over the phone.

How It Operates

Through a phone call, the victim often gets a contact from a fraudster posing as a representative of an organization or cause asking for charitable contributions. Scammers have been practicing this scam for an extended time. They have established tactics on which impersonations and circumstances increase the likelihood of deciding to give. They’ll request credit card details to transmit, and the rest is history—the history of how your money was never seen again.

How to Identify It

While legitimate causes and organizations seek contributions through cold calls — and do so successfully via effective phone methods — the hair on the back of the neck should still stand up in response to any unexpected request for financial information over the phone. Scammers may leverage current events, such as a genuine natural catastrophe, to beg “humanitarian help” or something similar with an air of validity and urgency. They may pose as representatives of legitimate non-profit organizations such as the Red Cross or other institutions such as fire departments.

Naturally, fraudsters will attempt to appeal to their victims’ emotions and are well aware of the persuasive power of sure tales or storylines. While emotional manipulation is not exclusive to fraudsters, it is a helpful tactic that should trigger caution.

What Should Be Done

If you want to donate to the cause the caller claims to speak, take down any information provided by the caller and the phone number from which they call, and hang up without giving any financial information. Google the phone number (enclosed in quotation marks for a precise match) to discover whether it has been associated with fraud before. 

The IRS’s Tax Exempt Organization Search and may be used to verify the legitimacy of a charity mentioned by a caller. We highly advise that if you are acquainted with a cause or organization, you seek to find a means to give other than via the solicitation caller—using the organization’s website is an excellent way to accomplish this.

5. Scanning

This fraud, a typical example of credit card information theft, has continued despite the advent of EVM cards (“chip cards”).

How It Operates

Scammers target highly trafficked yet unattended payment terminals at transaction locations such as shops, ATMs, and petrol stations. They put an electrical device called a skimmer on or near the actual card reader that silently collects credit or debit card information during the processing of a genuine transaction. Apart from recognizing the device’s existence, the victim has no means of knowing their card information has been stolen until fraudulent activity begins. At this time, it may be too late to stop.

How to Identify It

Skimmers are often disguised as genuine card reader components to evade detection, including the card input slot and keypad. Proceed with care if anything about the payment terminal seems to be tampered with, strange, or “off”. 

Visual indicators of tampering include misaligned graphics, colors on one part of the machine that does not match nearly identical colors elsewhere, components that appear larger or extend outward farther than expected, loose or crooked components, or any elements that seem to differ between one similar payment terminal and another nearby. Another possible indicator is a keypad that feels cheap, excessively thick, or strange to the touch.

What Should Be Done

Utilize additional care while using your card in laundromats, vending machines, or outdoor settings where prevention may be more difficult, or machine monitoring may be less direct. Skimming has traditionally been prevalent in tourist areas with a significant frequency of non-repeat clients. Apart from detection, one approach to mitigate risk is to use a mobile wallet in locations where it is accepted.

6. Scams Based on Phishing

As with overpayment scams, phishing scams impersonate a reputable firm or service and give fake instructions or links to get personal information. Several more hazardous ones aim to get direct access to financial information by masquerading as a genuine credit card firm or another legitimate institution that could need fair access to card or account information.

How It Operates

Phishing schemes may be delivered by phone or email and use various techniques to earn a target’s confidence. A classic phishing scam may state that credit card account information must be updated, that an account has been hacked and must be retrieved, or that a security check is required for some other reason. 

The fraudster may inquire about the target’s security questions, posing as though they already know the answers and only check them. The target may be requested to transmit such information over the phone, or an email may send them to an impostor website that looks just like the legitimate website of an established firm and enables the fraudster to gather information.

What Should Be Done

Never offer security questions in response to an unwanted call. This contains pre-determined personal questions, such as one’s mother’s maiden name or the street on which they grew up, but it also includes one’s date of birth, Social Security number, and the three-digit code on the back of a credit card. 

While legitimate worries about time constraints may exist, a heightened feeling of urgency or a specified, limited period in which instructions must be fulfilled could be another red sign. Additionally, declarations that the supposed firm “had been unable to contact you until now” or that “this is the last time you will be contacted” are phone hoax trademarks.


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