Copycat Crime

I WAS SITTING AT MY computer one lunchtime when an email popped up from one of my credit card companies, saying I’d just purchased nearly $12,000 of jewelry at a store in Toronto. Within minutes, I was on the phone to the card company.

I was quickly referred to the fraud unit. I told my story. The company credited my account, cancelled the card and mailed me replacements. Weeks later, I had to complete a form, signing off on my statement describing what happened. Months later, the company sent me a letter formally closing the case and saying I had no liability.

What I learned was that someone had called the card company, pretending to be me, and requested a duplicate card while I was supposedly traveling in Canada. Apparently, the caller supplied enough identifying information that a card was priority shipped to Canada. This had occurred several months before the Toronto transaction. The card was presented in person at the jewelry store.

I had set up a series of account alerts online, which is why I knew instantly when the fraud occurred. I suspect I was reporting the crime minutes after the fraudster had left the jewelry store. What baffled me was that there was no alert setting for receiving a duplicate card, let alone receiving a duplicate card in a foreign country. This fraud could have been easily prevented if the card company had emailed me, saying it had issued a duplicate card and shipped it to Canada.

Nonetheless, fraud alerts on your banking and credit card accounts can be valuable. After the jewelry incident, I reviewed my settings and tightened them further. Different banks may have slightly different alerts. But generally, they can be categorized as security alerts, transaction alerts and payment alerts. Some are there to protect you from your own mistakes, while others protect you and the financial firm from fraud.

• Security alerts identify unusual transactions, such as those made internationally.
• Spending alerts warn if you’re approaching your credit limit or have a transaction above a defined amount.
• Payment alerts remind you of due dates and let you know of payments made or missed.

Because the alerts can be customized, you control how tightly your account is monitored and therefore the frequency with which you can expect alert notifications. You also decide if the alert comes by email, text or both. Alerts help you spot a fraudulent transaction before it shows up on your next monthly statement—which is a plus, because you’re less likely to be held liable.

When setting up alerts, don’t forget about your debit cards. That includes the debit card associated with your home equity or personal line of credit. You may not carry it or use it often, which is all the more reason to know immediately if it’s being misused.

Read more by Howard Rohleder