Protecting yourself against credit card hackers — criminals that engage in credit card fraud and identity theft — is a vital part of using your credit card responsibly. Understanding how credit card hacking works and the many ways thieves can gain access to your personal financial information can help you protect both your physical credit card and your digital credit card account information.
Read on to learn how to protect your credit card from hackers, as well as what to do if your credit card is hacked.
What It Means for a Credit Card To Be Hacked
A credit card hack occurs anytime your credit card or credit card account number falls into the wrong hands. That information is then used fraudulently to make purchases and/or to engage in identity theft.
Credit card theft can entail everything from stealing your wallet to hacking into large databases holding hundreds of thousands of credit card numbers.
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Ways Credit Cards Can Be Hacked
Thieves use a variety of ways to get their hands on your credit card information. The biggest money scams in the U.S. are now done digitally through email, text messages, or fake websites. But there are still plenty of old-fashioned scammers who use snail mail, phone calls, and in-person ruses.
Here are some of the most common forms of both types of fraud:
• Lost or stolen wallet containing credit cards. An old but still common trick for credit card thieves is to steal the physical card, then use it and the information it contains to make fraudulent purchases. In addition, if other personal information is included in your stolen wallet, such as your address and even your Social Security number, thieves can use your identifying information to set up other fraudulent credit accounts.
• Phishing. Another common credit card hacking method is for a thief to attempt to get ahold of your credit card information through a phone call, text message, or email in which they impersonate a legitimate institution. For instance, a phishing email that appears as if it’s from your banking institution may entice you to click a link that takes you to a page where you’re then asked to enter your account information.
• Dumpster diving. Criminals search through trash to find discarded statements, receipts, and other documents that contain your credit card number and identifying information such as your name and address. They then use that information to make fraudulent purchases or engage in identity theft.
• Data breaches. Professional hackers can break into large retail, bank, financial, healthcare, social media, and other websites and steal reams of personal information that often include credit card and other personal financial information from thousands of users. The usual aim is to resell that data on the dark web. From there, criminal buyers use the data to commit credit card fraud and identity theft. If your data is on file at a breached site, you’re at risk.
• Credit card skimmers. Thieves also can use gadgets that can extract your credit card information when you swipe it to pay or to withdraw money from an ATM. These most commonly are found at gas stations or on outside ATMs, though they’re becoming less common with the introduction of chip technology.
• Inside jobs. Unscrupulous wait staff, store clerks, health-care billing workers, and others with access to credit card data may take a photo or otherwise copy your card information and use it to make fraudulent purchases. On a larger scale, sometimes these workers are part of a criminal ring that helps access financial data from thousands of individuals that’s then sold on the dark web.
• Public Wi-Fi networks. Your credit card also may be vulnerable to a credit card hack if you use a public internet connection, which is why it’s important to follow cybersecurity tips. If someone is monitoring the network and you enter any sensitive information, such as your account information, a thief may be able to swipe it.
Protecting Your Physical Card
Although digital credit card theft is more common than ever, plenty of old-fashioned thieves are still out there and would like to get their hands on your physical card. So, it makes sense to stay diligent. Taking these steps can help:
• Don’t reveal your physical card. Avoid giving your physical card to anyone, and never post photos on social media with your credit card showing.
• Black out the security code on the back of your card. Instead, you can file it in your password manager or another safe place. If your card is stolen, it’s harder for thieves to use the account information for online purchases if they don’t have your security code.
• Don’t sign your card. You can limit fraudulent in-person purchases if your stolen card is unsigned. You can write “See ID” in the blank area, then show your ID to store clerks in lieu of a signature. When a thief is asked for ID, they won’t be able to provide it, potentially preventing the transaction from going through.
• Use a protective sleeve or wallet. These can protect your card from being read by a technical device.
• Report lost or stolen cards immediately. If your card is compromised, make sure to alert your credit card issuer immediately. They will then close your card and issue a new one immediately. This is also a good idea if you’re notified that you’ve been part of a data breach.
Protecting Your Credit Card Account Information
In addition to your physical card, you need to protect your credit card data as well. Big credit card data hacks can mean your personal financial details and credit card account information are vulnerable. But there are steps you can take to protect yourself:
• Only use reputable shopping sites. Often, fraudulent sites are set up as a ruse to collect credit card information. When you shop online, always buy from trusted merchants.
• Avoid using your credit card when you’re on public WiFi. It can be easy for criminals to pick up your data when you’re using public internet networks. As such, you’ll want to avoid entering any personal or sensitive information while you’re using these networks, even if you’re on your own personal device.
• Check your account frequently. Don’t just wait for your statement to arrive in your email every month. Get in the habit of regularly monitoring your credit card activity online, especially if you find your credit card keeps getting hacked. If you find a suspicious charge, report it immediately.
• Be wary of phishing scams. You may get an authentic-looking email, text or phone call asking for your credit card information. This may be a completely cold call or a data thief looking to fill in information they may not have for you, such as your expiration date or CVV security code. Never give your information to anyone asking for it. Banks, credit card companies, retailers, and other reputable places only take your information if you contact them.
• Use smart passwords. Use strong passwords that include lowercase and capital letters, numbers, and symbols. Change your passwords frequently and remember that if it’s easy for you to remember, it’s probably easy for a thief to figure out. Password manager software can help you generate and keep track of strong passwords.
• Sign up for two-factor authentication. With two-factor authentication, a one-time code is texted or voiced to your phone when you log into a financial account. This helps to ensure the account holder is the one logging on. Other types of secure authentication, such as face ID, are beginning to be used by some organizations.
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Steps to Take When Your Credit Card is Compromised
If you think you were a victim of credit card fraud and/or identity theft, it’s important to act fast. The Fair Credit Billing Act (FCBA) limits your financial responsibility for credit card fraud to up to $50, so you won’t be on the hook for more than that in the case of bogus credit card charges that have led you to request a credit card refund. Even better, many major credit card issuers offer zero-dollar liability protection.
But if the thieves go on to use your personal information to commit other types of financial fraud, you may be liable. Acting fast will also help minimize the onerous work involved in untangling identity theft.
Here’s what to do if what to do if your credit card is hacked, or you see suspicious charges on your statement or other signs of fraudulent activity:
Contact Your Credit Card Company
As soon as you spot anything, call your credit card company. Tell them you think your card and card information is vulnerable and request a new card with a new account number. Most credit card issuers will comply right away (unlike if you were falsely disputing a credit card charge). However, you may be without a credit card for a bit while you wait for the new one to arrive.
Sign Up for Fraud Alerts
If you’ve received a letter or other notification that your personal data may have been compromised, you can place a fraud alert at all three credit bureaus — Equifax, Experian, and TransUnion — that may be monitoring your account. This stops unauthorized individuals from accessing your account information for a year, at which point you can request for it to be renewed.
Freeze Your Credit
A stronger step than setting up a fraud alert is to freeze your credit. When you ask for a freeze, the three top credit reporting agencies will make sure no one can ask for your credit report without your approval. The downside: A freeze can make it more cumbersome for you to legitimately apply for new credit.
File a Police Report
If you’re a victim of credit card fraud, you may need to file a police report. You may need that documentation as you move through different steps to report identity theft and other fraud as you try to recoup your losses. Your credit card issuer can help you determine if a police report is necessary. You can also report the fraud to the Federal Trade Commission on its website.
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Credit Card Security and Fraud Protection
There are a number of steps that credit card companies can take to increase credit card security and curb credit card hacks. For instance, some credit cards have two-factor authentication to protect access to your account. At SoFi, for example, we use a device-based security layer in addition to password validation for our credit card. You have the option to receive a security code by text or through Google.
Credit card companies can also offer the option to freeze your card immediately. You often can do so through their website or via their mobile app if you notice suspicious charges or other activity.
And, as mentioned previously, some credit card issuers — including SoFi — offer a zero-liability policy. As long as you report unauthorized or erroneous card transactions no later than 60 days after the first statement on which the problem occurred, SoFi won’t hold you liable for any fraudulent charges.
Credit card hacks can be costly, onerous, and time-consuming. But you can take steps to avoid hacks by protecting both your physical card and your online credit card information.
Selecting a credit card with identity theft protection, like the SoFi credit card, also can help protect your personal information. And that’s not the only benefit of a SoFi credit card. You also can earn up to 2% cash back when you redeem to save, invest, or pay down an eligible SoFi loan. Find out more about the advantages and apply for a credit card with SoFi today.
The SoFi Credit Card offers unlimited 2% cash back on all eligible purchases. There are no spending categories or reward caps to worry about.1
How can I protect my credit card from being hacked?
You can take a number of steps to fight credit card hacking methods. This includes checking your account regularly for any suspicious charges, being mindful of potential phishing scams, shopping online with caution, and keeping your physical card and your digital card information safe. If anything were to happen, make sure to report any suspicious activity as soon as possible and to use credit freezes and fraud alerts when necessary.
Can a hacker steal my credit card information?
The answer is a definite yes. Credit card hacks include stealing your physical card or credit card information and making fraudulent purchases directly with your account. Or, thieves may use your stolen personal information to set up a new fraudulent account in your name. Credit card hacks also happen when thieves steal reams of credit card and other personal financial information from databases at large retailers, financial institutions, and other places.
Can hackers use a credit card without a CVV?
Yes, although it can be more difficult for hackers to use a credit card without a CVV. The CVV number is often requested in transactions that don’t occur in-person as an additional layer of security to ensure that the person actually has the physical card.
Photo credit: iStock/Talaj
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1Members earn 2 rewards points for every dollar spent on purchases. No points will be earned with respect to reversed transactions, returned purchases, or other similar transactions. When you elect to redeem rewards points as cash deposited into your SoFi Checking and Savings account, as a statement credit to a SoFi Credit Card account, as fractional shares into your SoFi Invest account, or as a payment toward your SoFi Personal Loan or Student Loan Refinance, your rewards points will redeem at a rate of 1 cent per point. For more details please visit the Rewards page. Brokerage and Active investing products offered through SoFi Securities LLC, member FINRA/SIPC. SoFi Securities LLC is an affiliate of SoFi Bank, N.A.