Identity Theft

Credit Card Dumps: What They Are and 5 Ways to Protect Yourself

Identity fraud hit an all-time high in 2017, according to Javelin Strategy and Research, with a total of 16.7 million victims. Credit cards remain the top target for identity thieves because they’re easy to use.

Number of identity fraud victims in 2017 (source: Javelin Strategy)

One way hackers can access your credit card information is through credit card dumps, which is the fraudulent copy of information from the magnetic strip of a credit card.

If you want to protect yourself from credit card dumps, it’s important to understand how they work and steps you can do to limit your exposure.

What are credit card dumps?

As mentioned previously, credit card dumps happen when an identity thief steals information from your credit card’s magnetic strip.

This information includes your credit card number and expiration date, and fraudsters can use the data to create a fake credit card that they can use just like you use yours.

Credit card companies have been trying to combat this type of fraud through the EMV chip. This chip creates a unique token every time you use your card, so if hackers steal the token, it’s already been used.

But as you’ve probably experienced at the grocery store or another retailer, if the card reader isn’t reading your chip properly or your card doesn’t have a chip, you can still swipe like you used to.

And many retailers, especially small businesses, haven’t even transitioned their card readers to accept an EMV chip.

How hackers get your card information

According to Robert Siciliano, an identity theft expert at Hotspot Shield, there are a few different ways identity thieves can create credit card dumps, including:

  • Placing a fake credit card reader over a legitimate one to skim the data from your card. This frequently happens at gas stations and ATMs.
  • Infecting a point-of-sale card reader with malware that copies the data from each credit card that gets swiped.
  • Hacking a retailer’s network to access card information they have stored.
  • Taking it through an unsecured internet connection.

In most cases, there’s no way for you to know that your card information has been stolen until the criminal has used it or the retailer informs you of a security breach.

Preventing card fraud is almost impossible”

It’s important to stay vigilant so that you’re ready to take action as soon as you notice something off.

5 ways to protect yourself from credit card dumps

“Preventing card fraud is almost impossible,” says Siciliano. But there are some things you can do to limit your losses.

1) Check for skimming devices

Anytime you use an ATM or pump gas, take a look at the card reader.

In many cases, there should be a tamper-proof seal the owner placed on there to show that no one has placed a fake reader over the legitimate one. If you notice that the seal looks like it’s been removed at any point, use a different ATM or gas pump.

Also, if the material on the card reader looks different from the surrounding material, or it looks off in any other way, it’s better to be safe than sorry. Use a different one and report it to the bank or gas station.

2) Shop securely online

Whenever you shop online, it’s important to make sure that the website you’re using it secured.

It’s always important to look for HTTPS in the address bar when placing an order, which would mean the website itself is secured”

“It’s always important to look for HTTPS in the address bar when placing an order, which would mean the website itself is secured,” says Siciliano. “Only do business with those in person or online that you know, like, and trust.”

So, if you get an offer from a website you’ve never heard of, do some research first. Check for the HTTPS in the address bar first, then do a quick internet search to make sure it’s not a scam.

3) Check your accounts often

As we mentioned previously, you may not know that someone has stolen your information until they’ve used it. Credit card companies do their best to spot fraud when it happens, so you may get a notification from yours.

But they don’t always catch fraudulent purchases when they happen, so it’s crucial that you check your online accounts often to catch the fraud before it gets worse.

An easy way to do this is to sign up for an online money management tool like Mint or Personal Capital. These platforms can import transactions from all of your accounts into one place, so you don’t have to log in to each account separately.

When you do spot fraud, don’t hesitate to take action.

“Often the best course of action is to call the toll-free number on the back of your card and get in touch with the fraud department,” says Siciliano. “They will immediately check into potential fraud and, in some cases, mail you another card overnight.”

4) Make sure your card has fraud protection

All credit cards these days offer fraud protection, but some are better than others at detecting fraud and getting your money back to you.

Check out SuperMoney’s credit card reviews page to compare top credit cards and reach out to each one to determine how they handle fraud.

5) Use a credit monitoring service

Credit card fraud in any form can harm your credit, so it’s critical that you have a credit monitoring service to help you stay on top of things.

Some of the top credit monitoring services include:

If you find that you already have fraudulent activity on your credit report, make sure also to check out some credit repair companies that can help you get them removed.

The bottom line

“Consumers have no control over how their credit or debit cards or misused,” says Siciliano.

But the more diligent you are about keeping an eye on your accounts, the easier it will be to recover if you fall victim to credit card dumps.