What is the severity of credit card fraud and identity theft?

credit card fraud

Financial fraud using credit cards has become a very common practice in recent years. Every year, it is estimated that credit card fraud in the United States amounts to more than $1 trillion. As a result of this situation, it is extremely important to report any credit cards that have been lost or stolen immediately;

Financial fraud is a serious violation of federal law in the United States, and anyone who commits it should be punished. But how serious are credit card fraud and identity theft? What are the penalties for using a credit card fraudulently?

Criminals are committing these types of crimes more frequently every day, so it is timely to learn how to prevent identity theft and card counterfeiting.

We will offer several tips in this article, so please read to the end and avoid becoming a victim of credit card fraud.

Elements of credit card fraud

A person can commit debit/credit card fraud in various ways, but the most common ones are:

A person who fraudulently obtains, takes, signs, uses, sells, buys, or falsifies another person’s credit or debit card information.

Your own card is used knowing it is revoked or expired, or that the account does not have enough money to pay for the items you are buying.

Purchase goods or services from a third party knowing that the credit or debit card was obtained illegally or is being used without authorization.

Keep Reading: How to send money online with a credit card?

Types of credit card fraud

Credit fraud describes the use of a credit card, either one’s own or another’s, to purchase goods or services with the intent to avoid payment. While it is easy to understand the theft of a credit or debit card from a wallet or purse, it is much more common today for the information to be stolen and not the actual card. Credit card fraud comes in a variety of forms with new and inventive methods being devised almost every day, below are some of the most common types of credit card fraud:

Opening new accounts using stolen identification.

Taking over an existing account.

Using a fake identification card.

Making use of someone else’s lost or stolen card.

Penalties for credit card fraud

Depending on the facts of the crime and its severity, credit card fraud can carry stiff penalties. It is possible to be charged with a felony or a misdemeanour for theft of a credit card without using it. Conversely, the more sophisticated the crime, i.e. counterfeit cards, the more likely it is to be treated as a felony.

In general, a prison sentence of 1 to 5 years is imposed for credit card fraud involving the theft of a card or its information. It is much more severe to deal with identity theft, with prison sentences ranging from 10 to 20 years. In addition, if the thief has specialized tools of the trade to commit the crime, that is, he has them with him at the time of being captured, then he can increase the prison time by an additional period for carrying them.

How can credit card fraud be prevented?

Several security precautions can be taken to prevent it, including:

Unless you’re dealing with a reputable company, don’t give out your credit card number or PIN.

Shred receipts immediately or store them securely.

Never leave cards in plain view of thieves or counterfeiters, i.e., never leave them out in the open.

Don’t write down PIN numbers and keep them in your wallet.

By enrolling in online statements, you can see your card charges instantly, since the alert and notification service sends your transaction information immediately to your cell phone.

In cases of fraud, it’s also important to obtain reports and/or credit reports on a regular basis. Documents like these can help you determine what loans and obligations you owe.

What to do if you are a victim of credit card fraud?

In a situation such as this, it is imperative that you report your stolen card to the original card issuer right away. For reporting lost or stolen cards, many companies have hotlines that are available 24 hours a day (24/7). In cases like these, there are other entities that can be contacted:

The Federal Trade Commission (FTC) is in charge of sending your claim to a special attention center and disseminating it throughout the country in order to help local authorities.

Contact your local consumer protection agency.

The maximum liability for lost or stolen credit card holders is $50 at the time a report is filed.

Are you likely to become a victim of identity theft credit card fraud?

Although you may think it would be impossible for someone to scam you, don’t be overconfident.

There are times when luck isn’t your friend and you find yourself in an uncomfortable circumstance that can ruin your day and damage your finances. Thus, pay attention to this information and you will see that credit card fraud may just be around the corner.

In the United States, there are 374 million credit cards, but only 75.5% of the population has access to one, according to the American Bankers Association of the United States (ABA or US American Bankers Association).

The majority of Americans own a credit card, but how likely are you to become a victim of identity theft?

There were 1,709,013 reports of identity theft credit card fraud in 2018, which means that there was one attempted scam or card fraud for every 218 credit cards.

While this represents only a 0.45% fraud risk for each credit card you have, if you carry three or four credit cards in your wallet; your chances of being a victim of credit card fraud from identity theft will greatly increase.

What are the dangers of identity theft and credit card fraud?

Since American laws are extremely strict when it comes to fraud crimes, if a criminal comes up with the idea of scamming you and the police catch him, he will potentially go to jail.

The Law School of Cornell University helps us identify in Section 1028 of the United States Code the exemplary punishment for those who commit identity theft fraud; establishing a maximum prison sentence of 15 years plus a fine.

These days, some cyber-criminals are trying to be clever by using equipment like skimmers, a device that can clone your credit card, to commit scams.

There is a provision of Section 1029 of the United States code that sets a penalty of 10 to 15 years in prison for crimes related to fraud of remote or electronic access devices as well as a fine for a large sum of money.

Be sure to look at the severity of the crime, the criminal history of the scammer, and even the amount of money taken from the credit card.

Each of these factors can affect the final verdict and lead to fewer years in prison or a more severe sentence.

Keep Reading: How to activate your Chase credit card

How can you protect yourself from credit card fraud?

If you are concerned about credit card fraud, you can relax and feel some relief; in fact, if you report it in a timely manner, the Federal Law provides that in the event of any unauthorized or fraudulent charge to your credit card, you will only be responsible for US$ 50.

In addition, most of the time, the amount is not paid because the major credit card issuers offer zero liability fraud policies. This means that you would not be charged as long as you reported it properly.

We want to emphasize the importance of reporting credit card fraud; something that you must do immediately after spotting a possible scam.

In any case, here are some ways you can protect yourself from credit card fraud:

Follow good security practices

Identity thieves don’t need a credit card to withdraw money from your credit account; all they need is the vital information such as your name, card number, CVV code, address, and they’re in business.

Therefore, we recommend that you do not disclose your bank information to anyone. Change your passwords regularly and do not carry your cards with you.

If you have two credit cards, you could use one for bills or subscriptions and the other for your daily use, that is, to take to work or for a casual outing.

You can identify your credit card expenses more easily with this technique.

If you don’t have your credit card and need to pay online, avoid using public Wi-Fi. Cyber-attacks and data theft traps are common in these connections, so better connect to your mobile network data.

If you think your identity has been stolen, freeze your credit account.

Ideally, you should contact your credit card issuer’s help desk and request a freeze on your credit account if you suspect your identity has been stolen.

Contact us as soon as possible

In the event that you lose your credit card due to theft or loss, you should contact your credit card issuer as soon as possible so they can cancel the card, update your data, renew your passwords and issue you a new card.

When you follow these tips, credit card fraud and identity theft will be nearly impossible for you.

Should you consult an attorney?

You may be able to protect yourself against credit card fraud with the help of a criminal defense attorney. An attorney can also help you file a charge against anyone who found your credit card and used it in your name.

Important information

You can report identity theft to the Federal Trade Commission (FTC) by following these steps:

  • Through the telephone number 1-877-438-4338.
    • In this case, the FTC takes all your data and details of your situation, but does not provide an identity theft report or an action plan.
  • This can also be done through the web portal found here.
    • You will receive an identity theft report and an action plan through this reporting method.
    • A web portal account is required to update your action plan, track the progress of the process, and receive form letters to send to creditors. You can download the FTC publication here , where you can find advice, letters, and checklists.
  • You can also report identity theft to the local police, which is required in the following situations:
    • You know the person who stole your identity.
    • In an interaction with the police, the thief posed as his person.
    • You are asked for the police report by a creditor or company.

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