TEENY, TINY CHARGES
How it works
Thieves get hold of your credit- or debit-card number and make very small charges of 20 cents to $10. The charges appear on your bill with an innocuous-sounding corporate name, and a toll-free number may appear next to the charge. But when you call the number, it's either disconnected or you're instructed to leave a message and your call is never returned.
How it works
Thieves get hold of your credit- or debit-card number and make very small charges of 20 cents to $10. The charges appear on your bill with an innocuous-sounding corporate name, and a toll-free number may appear next to the charge. But when you call the number, it's either disconnected or you're instructed to leave a message and your call is never returned.
That was precisely the scam that the Federal Trade Commission broke up in June, according to spokesman Frank Dorman. "We don't know where the thieves got the card numbers, but we're looking into that," he says. The scam was successful because most consumers either didn't notice the charges or didn't bother to correct them because the amounts were so small. In all, the crime ring racked up more than $10 million in bogus charges, the FTC estimates.
Prevent it
Scrutinize every item on your bill every month, and question those you don't recognize. (Some charges, but not all, will list a phone number.) If you think a charge is fraudulent, notify your card company as soon as possible but no later than 60 days after the charge appears. By law, the card company must remove the disputed amount from your account while it investigates. Worst case, by law you're liable for only the first $50 on a credit card. (In most cases, Visa and MasterCard will cover the full amount.) Debit cards offer fewer protections: You must report the problem two days after you notice it. If you don't, you could be liable for the first $500 in fraudulent charges. If you wait more than 60 days after your statement is mailed, you could lose all the money in your account.
Scrutinize every item on your bill every month, and question those you don't recognize. (Some charges, but not all, will list a phone number.) If you think a charge is fraudulent, notify your card company as soon as possible but no later than 60 days after the charge appears. By law, the card company must remove the disputed amount from your account while it investigates. Worst case, by law you're liable for only the first $50 on a credit card. (In most cases, Visa and MasterCard will cover the full amount.) Debit cards offer fewer protections: You must report the problem two days after you notice it. If you don't, you could be liable for the first $500 in fraudulent charges. If you wait more than 60 days after your statement is mailed, you could lose all the money in your account.
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SKIMMERS
How they work
Skimmers, devices that thieves attach to ATMs or gas pumps to steal your debit account number and password, have been around for years -- and they're not going away. They're getting even more sophisticated.
How they work
Skimmers, devices that thieves attach to ATMs or gas pumps to steal your debit account number and password, have been around for years -- and they're not going away. They're getting even more sophisticated.
The devices are placed at the mouth of the card-acceptance slot and record the data off of the magnetic strip on the back of your ATM card when you slide it into the machine. Crooks will usually plant a second device, such as a hidden camera or a transparent plastic PIN pad overlay, that's used to record your PIN when you type it in. In the early days of skimming, the thief had to return to the ATM or gas pump to retrieve the apparatus. But now, Krebs says, wireless technology enables the devices to be rigged to send account information via text message to the thief's cell phone. "The thief can be down the street in a coffee house or halfway around the world," he says. "As long as he's got a working phone signal, he can get the information sent to him right away and start using it."
Prevent it
Use credit cards and avoid using non-bank ATMs. Those machines are generally located in areas that are less secure, making it easier for thieves to tamper with them. And check the card slot: If there's a plastic strip or plastic film sticking out, or anything glued to the card reader, go elsewhere. If your card is stuck inside the card slot, do not leave the machine. Use your cell phone to call your bank branch or the 24-hour service number to report the problem.
Use credit cards and avoid using non-bank ATMs. Those machines are generally located in areas that are less secure, making it easier for thieves to tamper with them. And check the card slot: If there's a plastic strip or plastic film sticking out, or anything glued to the card reader, go elsewhere. If your card is stuck inside the card slot, do not leave the machine. Use your cell phone to call your bank branch or the 24-hour service number to report the problem.
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