One common misconception among credit card holders — a category that includes millions of consumers — is that they do not need to deal with every single fraud alert that comes their way. After all, not every alert is a sure sign of credit card theft, and many card holders see their security as primarily the job of their credit card company or bank.
A recent article in Time Magazine summed this sentiment up well: “Dealing with fraud alerts can be time-consuming, so you may be wondering if you have to respond to every single time, or whether your card company can just take care of the problem itself. After all, you’re shouldn’t be liable for charges that you didn’t actually make.”
Indeed, it is technically true that no cardholder agreement requires consumers to act on any credit card fraud alert. But it is a mistake not to. As the news source points out, even failing to respond to a security alert that is not an instance of theft can lead to your card issuer freezing your account. And of course, if the fraud is real, you may soon find out that you have been the victim of identity theft.
A growing threat
Across the U.S., complaints of identity theft are increasing in frequency. Last year, the Consumer Federation of America and the North American Consumer Protection Investigators released the results of a survey of state and local consumer agencies which found that issues of identity theft are among the fastest growing complaints submitted by consumers.
“It’s clear that more needs to be done to address identity theft,” Susan Grant, CFA’s director of consumer protection and privacy said. “What’s needed is to require better security for consumers’ personal information.”
Unfortunately, many consumers handle credit card theft they same way they might address home security after a burglary — namely, too late. Often, it is easy to be lulled into a false sense of security on your property, until one day you come home to find all of your belongings strewn about the house and several valuables missing. Sure, you can install a security system that may protect you from future incidents, but the crime has already been committed.
It is far better to be vigilant and aware of potential threats before they occur. That’s why it is so important for all card holders to monitor their credit reports frequently, even if nothing appears to be wrong with them. It only takes one instance of fraud to spiral out of control and ruin a person’s credit. Be sure to file a police report and contact your card issuer as soon as possible. You may also want to file a report with the Federal Trade Commission (FTC), and also a fraud alert with the three major credit bureaus, which will prevent thieves from fraudulently using your card information.
For the best protection, consider signing up for a credit monitoring services that can alert you to certain activity on your credit file that may be indicative of fraud.