And the Credit Fraud Continues 

In this day and age, it is hard to believe that things can still be shocking. However, one of the latest scams within the credit trade is truly appalling. Crafty criminals have found yet another way to take advantage of unprepared card holders. The latest rash of crime involves balance transfer fraud.

Understanding the Fraud

Balance transfer fraud occurs when thieves are able to convince your credit card company that they are the legitimate account holder, simply by knowing the answers to some age old questions, such as your mother’s maiden name, the town you were born in, and other information which is all too easily accessible on the internet. A criminal can gather enough information about you to be able to gain access to your account and simply request a balance transfer on your credit card account over the phone.

Even if the thief does not find your personal information online, experienced scam artists can often schmooze the information from an unsuspecting customer service representative who may not realize the situation or who may not have been trained properly. Either way, with just a few bits of knowledge and a thief, your credit is not safe.

Criminals can also prowl through mailboxes and trash to find balance transfer checks you received from your credit card issuer. The fraudster can simply write out the checks to anyone or use them to make deposits in to their own bank accounts. The amount of these checks go against your credit card balance, and in some cases can even max your credit limit out completely, incurring fees and charges that can get outrageous.

Prevent the Risk

This can be especially dangerous if you do not make a habit of carrying a credit card balance or you pay it off each month. Those who rarely feel they have a need to check monthly statements may not know for some time that they have become the target of fraud. It is crucial for your own financial well-being that you don’t simply toss aside unopened statements or just file them away without taking a close look at what transactions have occurred throughout the month.

What Else Can You Do?

It is also important that you speak to your credit card company about upgrading their security measures. This is a good idea even if you haven’t been victimized. Because of the availability of information about you, your credit card company should be willing to change security information to something not common knowledge. Remember that fraud can be committed by people you know as well as strangers.

Make sure that you shred all of the unwanted balance transfer checks or credit card applications that you receive, especially those from card issuers at which you do not have an account.

Remember, simply tearing up a credit card application or balance transfer checks and throwing them in the trash is not good enough to avoid being defrauded. You have to shred them to ensure safety from fraud.  You can also contact your card company and tell them you do not want checks mailed to you except upon your request. If you suspect checks or mail has been stolen from you, check all your statements and report any cases of fraud as soon as possible. Be sure to document the fraud report and all of the communication you had to deal with the issue.

Remaining proactive and in touch with your accounts can help reduce your likelihood of becoming an unsuspecting victim or at least, can hamper it from getting out of control.

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This entry was posted on Thursday, January 29th, 2009 at 9:08 am and is filed under Card Security, Tips & Advice. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.