As the saying goes, if you use credit cards often enough, eventually one of them may get compromised. No matter how careful you are, even if you avoid something awkward like losing your wallet, a merchant could still leak your credit card information, and even a bank’s database is not completely impregnable. So the key is not avoiding fraud forever, but spotting it as early as possible and quickly stopping any further risk. Today I want to talk about what happened a few days ago when my Chase credit card was used fraudulently.
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An Introduction to Credit Card Fraud
Fraudulent charges on a credit card are generally referred to in English as an Unauthorized Charge, meaning a transaction that was not authorized by the cardholder. There are many possible reasons for this, such as a lost credit card, a leak in a merchant’s or bank’s database, stolen personal information, and so on. Of course, banks are not sitting idle either, and they use a variety of methods to prevent fraud. For cardholders, the good news is that we are not responsible for fraudulent charges, which is the well-known zero liability principle for U.S. credit cards. For a more detailed discussion of credit card fraud, see:
What Happened When My Chase Card Was Used Fraudulently
A Late-Night Fraud Alert
At x/xx/2016 23:53, I received both an email and a text message saying that my Chase UA credit card had been used at PURITANS PRIDE and asking me to confirm the transaction:
I obviously had not made that purchase, so I immediately clicked NO in the email.
After Confirming It Was Fraud
As the email said, once I confirmed it was fraud, my credit card was temporarily placed on hold and could not be used for other purchases. Chase also recommended that I immediately call the number on the back of the card to confirm the information with Chase’s Fraud Department. Wanting to get it resolved as soon as possible, I called the number on the back of the card right away and was transferred to the Fraud Department.
- Me: Hi, I received an email saying there was an unauthorized charge, and I can confirm it was not my purchase.
- Representative: Okay, let me take a look. Can you tell me your SSN?
- Me: xx-xxx-xxxx
- Representative: Thank you. I checked your account and there is indeed a charge at xxx. Are you sure you did not authorize it?
- Me: Definitely.
- Representative: Okay, I’ve canceled this credit card. You will receive a new card within 3-5 business days, and the card number will be different. I will remove this charge.
- Me: Okay, thank you. Is there anything else I need to do? Do I need to contact the merchant where the fraud happened?
- Representative: No, you don’t need to do anything. You will receive the card within 3-5 days. Since you’ll have a new card number, no one will be able to use the old one fraudulently.
- Me: Hmm, I think I actually shopped at this store before. Could the fraud have happened because the merchant had my card information on file?
- Representative: No, you don’t need to do anything. You will receive the card within 3-5 days. Since you’ll have a new card number, no one will be able to use the old one fraudulently. And you will not have to pay this charge.
- Me: Okay, thank you.
- Representative: Is there anything else I can help you with?
- Me: Nope.
This conversation shows two things:
- After a fraudulent charge is detected, the card may be temporarily frozen, but you still need to speak with the credit card fraud department for verification before a replacement card is issued.
- The representative usually will not tell you the reason for the fraud, or may simply not know. Their job is mainly to send you a new card.
So if your card is used fraudulently, it is best to call customer service as soon as possible and confirm the situation.
Receiving the New Card
Five days later, I received the new card. The expiration date, card number, and the three-digit security code on the back were all different from the original card. I also checked the credit card’s closing date and due date, and both were the same as before.
Chase sent the replacement card by regular mail, which was honestly pretty slow. A year earlier, my Citi credit card had been used fraudulently because of the Target data breach, and Citi sent me the replacement card via overnight shipping. That was some serious big-bank style!
My Thoughts on What Happened
What Caused the Fraud?
It is worth trying to understand the cause of a fraudulent charge, because if one of your cards is compromised, your other cards might also be at risk. So I used Mint, an account management app, to review my past transactions. I found that this card had basically only been used at Chinese supermarkets and Target, but I had used many of my other cards at those same places without any problems. So I decided not to take any further action, such as replacing the numbers on my other credit cards.
How Did Chase Detect the Fraud?
I checked the timing, and right after the fraudulent charge occurred, Chase immediately sent me both an email and a text message asking me to confirm it. Another thing is that this transaction happened online. So my guess is that someone stole my credit card number, and possibly also the security code and expiration date, and then tested the card online to see whether it would go through. If it worked, they could then make a larger purchase later. But they did not have my billing address, so when Chase verified the card, it noticed that the billing address did not match and immediately contacted me to confirm the transaction.
Summary
If your credit card is used fraudulently, there is no need to panic. You just need to go over the recent transactions with the bank and identify which ones are yours and which ones are not. After the bank investigates, it will usually remove the fraudulent charges and send you a new card. Banks may not always detect fraud immediately, especially when the amount is very small. So it is a good idea to check your transactions regularly and watch for any unfamiliar charges.
If you have a lot of credit cards (>10), you can use Mint to manage them all. That way, you can review all of your recent credit card transactions in one place. I regularly check my transaction history this way to see whether any unfamiliar charges show up. For more on Mint, see: