Stolen Credit Card—Best Practices To Limit Losses and Enhance Financial Security
Credit card theft has become a common concern, with approximately 65% of cardholders experiencing this unsettling event during their lifetime. Whether it's through misplaced or stolen wallets or an extensive data breach, stolen credit card incidents often lead to significant financial losses, credit damage, and emotional distress.
To help you navigate this complex situation and limit financial losses, this article will explain what to do if your credit card information is stolen and answer questions such as:
- How can you identify suspicious activities on your credit card statement?
- How do you report stolen credit cards to credit agencies and financial institutions?
- What safety measures can you implement to secure your credit card information?
Signs Your Credit Card Info May Have Been Stolen
According to Experian, an average American owns four credit cards at one time, making it challenging to keep track of them. If you can’t find your credit card and think it may have been stolen, look for the following warning signs that might signal unauthorized usage:
- Unfamiliar charges—Unrecognized charges on your credit card statement could indicate that someone else is using your credit card. While small charges such as $0.05 may not raise suspicion, be cautious as thieves often test a card's validity with minor purchases before progressing to larger amounts.
- Transactions in unfamiliar locations—If your card statement shows purchases made in cities or states you haven’t recently visited, your credit card information might be in the wrong hands.
- Unrecognizable subscription services—If you notice bills for subscription services or memberships that you don’t recall signing up for, this could mean that your card details have been compromised.
- Changes in credit score—Unauthorized use of your credit card can lead to an increase in your credit utilization rate, which can impact your credit score. Sudden and unfamiliar changes in your credit score might indicate fraudulent activity.
External Stolen Credit Card Indicators
When looking for evidence that your credit card may be stolen, it’s not enough to pay attention to unusual charges—some signs may be more external but equally important. You should consider the following indicators:
- Suspicious login alerts—Most financial institutions and payment platforms send alerts for unrecognized login attempts. If you’re receiving notifications of attempted logins from unknown devices, it can be an early indicator of someone trying to access your account.
- Unexpected packages—Fraudsters might use your credit card information for online shopping but forget to change the delivery address. If unexpected packages start to arrive at your doorstep, your financial information may be used by somebody else.
- Missed card statements—Credit card issuers send card statements at the start of each billing cycle. If you suddenly stop receiving credit statements, it's possible the fraudster may have changed the linked address.
- Purchase declines—If your card is declined for no apparent reason, it could mean your account is compromised. Banks often block cards when they identify unusual spending activity.
- Hard inquiries on a credit report—If you’re discovering hard inquiries on your credit report that you did not initiate, someone may be using stolen credit card information to take out loans or open new credit lines in your name.
- Calls from debt collectors or creditors—Calls from debt collectors or creditors regarding unpaid bills that you weren’t aware of might be a sign that someone is making purchases or creating new accounts using your credit card info.
What To Do If Your Credit Card Is Stolen
Once you confirm your credit card has been stolen, it's crucial to act immediately and take the following steps to protect your finances:
- Lock or deactivate your card
- Notify credit reporting agencies
- Update recurring payment information
Lock or Deactivate Your Card
If there is a chance that your card has been misplaced rather than stolen, the first step is to lock your card. There are two ways to temporarily disable a stolen credit card:
If you've noticed signs of theft, you should report it and ask for card deactivation. Your credit card issuer will inquire about the reasons you suspect the card has been stolen, cancel the compromised card, and issue a new card with a different number.
While the standard delivery time for a replacement card is typically 7–10 business days, issuers often provide an option for expedited shipping. This service can significantly shorten the waiting time, ensuring the replacement card arrives within 1–3 business days.
Also, If your credit card numbers have been stolen but your card remains in your possession, it’s important to change your account's login information. This includes your password, PIN, and any security questions that might provide the hacker with unauthorized access.
Notify Credit Reporting Agencies
Since credit card theft might progress to identity theft and fraud, you should notify major credit bureaus—Experian, Equifax, and TransUnion—and ask them to place a fraud alert on your account.
This will make it difficult for credit card thieves to open more accounts, acquire loans, abuse healthcare benefits like Medicare or Medicaid, or apply for government grants using your details. You should also request a free credit report through AnnualCreditReport.com to monitor changes in credit and dispute any inaccurate information.
Update Recurring Payment Information
After receiving your replacement credit card, it is essential to update your billing information for any payments linked to the previously stolen card. This includes subscriptions, utility bills, and any other recurring charges. Doing so can help you avoid service disruptions and late payments that may negatively affect your credit score.
How Can a Credit Card Get Stolen Without Being Lost?
While traditional methods such as pickpocketing and purse-snatching are still common, modern criminals commonly leverage the following tactics to obtain your credit card information without actually possessing your card:
- Shoulder surfing
- Skimming and shimming
- Phishing scams
- Public Wi-Fi exploitation
- Data breach
Shoulder Surfing
Fraudsters may steal your personal or financial information by discreetly watching you in public spaces, such as ATM booths, coffee shops, or public transport. As you enter your password, username, or CVV code in your phone, these individuals memorize or record the credentials and later use them for malicious purposes.
Skimming and Shimming
Skimmers are inconspicuous devices attached to the card insertion slots of ATMs or other POS terminals. Their mechanism of action involves scanning and recording the card's magnetic stripe data when swiped or inserted. Shimmers operate the same way, but they read the card’s data from the chip rather than the magnetic stripe.
After skimming or shimming, fraudsters use the collected data to make fraudulent transactions online. They may also clone the card, which enables them to make purchases in person.
Phishing Scams
Cybercriminals may attempt to trick you into revealing sensitive information, such as passwords, credit card numbers, and Social Security numbers. This type of credit card scam is often executed through emails or messages that appear to be from reputable sources such as your bank or credit card issuer. They will often ask for urgent action, not allowing you to think about the unusual requests for your sensitive info.
Phishing scams often involve sending a link that redirects you to a seemingly legitimate website designed to steal your information as you enter it. Some phishing emails may also include malicious software attachments that, if downloaded, allow the scammer to access everything you type on your device, including your financial information.
Public Wi-Fi Exploitation
Public Wi-Fi networks, available in restaurants, airports, and hotels, offer convenience but are usually unencrypted, which means the data sent over them can be intercepted by malicious actors.
Hackers use this opportunity to set up deceptive hotspots that resemble trusted networks. When unsuspecting users connect to this fake network, fraudsters can gain access to their login credentials, highly personal information, and credit card details, which can then be used for fraud, identity theft, or other illegal purposes.
Data Breach
Statista reports that data breaches led to significant financial losses in 2023, totaling $9.48 million in the U.S. Data breaches primarily target sectors that deal with vast amounts of sensitive data, such as the healthcare, banking, and e-commerce industries such as Amazon, eBay, AliExpress, Shein, and Wish.
In a data breach, cybercriminals exploit platforms’ vulnerabilities, such as outdated systems and insecure APIs. They may also use malicious software to infiltrate systems and gain access to credit or debit card numbers, banking account information, Personally Identifiable Information (PII), and internal documents.
How To Avoid Credit Card Theft
If you’re worried about losing your credit card information, you should know there are ways to reduce the chance of credit card theft happening:
Privacy—A Solution To Enhance Your Financial Security
If you're worried about your credit card details getting stolen, you can connect your debit card or bank account to Privacy and use their virtual cards instead. Privacy is PCI-DSS compliant and employs the following security measures to protect your data:
- Military-grade 256-bit encryption with split key and partial key protection
- Transport Layer Security (TLS)
- Internet Protocol Security (IPsec)
- Firewalls with the latest security patches
- Regular third-party security audits
Aside from the security features, Privacy has an intuitive mobile app that’s available on both Android and iOS platforms. This app allows you to create new virtual cards and manage them on the go.
Privacy also offers extensions for different browsers, such as Chrome, Firefox, Edge, Safari, and Safari for iOS. The Privacy Browser Extension will autofill payment details at checkout, so you don't have to memorize card numbers and enter them manually when shopping online.
Privacy—Card Types and Features
You can generate two types of virtual cards using Privacy:
- Single-Use Cards—These cards close automatically soon after the first purchase. This limits the exposure of your financial data and protects it from potential misuse even if a hacker or scammer steals the card details. They are a perfect option when you don’t fully trust the security of the merchant’s platform.
- Merchant-Locked Cards—These cards can be used multiple times, but they “lock” to one specific vendor. This restriction means that if a merchant's website suffers a security breach, hackers won’t be able to use your card details anywhere else.
Both types of cards can be paused or closed, allowing you to temporarily disable the cards and avoid any unexpected charges. You can also set spending limits on your Privacy Cards, which can be useful if you’re concerned about a merchant potentially overcharging you. Privacy will decline all charges that go about the limit you set.
How To Create Privacy Virtual Cards
You can generate your first Privacy Card in four simple steps:
- Sign up for a Privacy account
- Provide necessary verification details
- Add a funding source (debit card or bank account)
- Request your first Privacy Virtual Card
Privacy offers three plans—you can learn more about them in the following table:
Privacy Cards are issued by Visa® and Mastercard®, which means that they can be used at most vendors and websites that accept these card types, including, Amazon, eBay, and AliExpress. Privacy Cards are accessible to all U.S. residents over 18 who have a checking account at a U.S. credit union or bank.
