Public Service Announcement

Credit cards can be both a blessing and a curse.  As all of you have likely experienced yourselves at some point in time, we had a fraud problem with one of our credit cards last Saturday.  In our case, the card number had likely been stolen at a gas pump 'skimmer' device, a duplicate fraud card was created and used at a Target store.

Fortunately for us and our bank, we only use this card at gas stations (because gas station skimming is a huge fraud source) so the Target attempted purchase stood out, the bank texted us immediately and we verified that we have both cards in our possession and that the purchase was fraudulent.  From what we gathered on the phone with the bank, the thief was first denied, went to a different register and the second attempt was approved (?).  Not sure if the thief was in a physical store, or perhaps online, but either way, that card number is invalid, our credit is secure, the new cards were issued and received today and all is well.  

I do want to take this opportunity to tell you all about the new chip credit cards which are coming to the USA (finally) after years of use in the rest of the world.  A chip card looks like this, see the gold chip on the left side of the card:

The back of the card still has the old-fashioned magnetic stripe for the time being.  That magnetic stripe is the reason that 50% of the worldwide credit fraud occurs in the USA.  We only account for 25% of the worldwide credit usage, but fully half of the fraud. OUCH! 




 The stripe can be copied by a skimmer device at a store or gas station or stand-alone ATM.  Here is picture of a skimmer I found on the internet:


SNEAKY Devil, it looks just like a regular card slot and fits right over it

Anyway, chip cards will be more secure, and will eventually all use PIN numbers just like your debit or ATM cards instead of a signature.  The PIN communication is between the card and the terminal, making it next to impossible to crack or steal from databases (like the recent Target data breach) and will eventually make it much less likely that your card can be duplicated.  MasterCard will switch over to chip cards by October 2015, so if you have a MasterCard due to expire soon, you will likely see the new format in your renewed card.  I do not have a firm date for the Visa system switch, but it will likely be in 2015/2016 according to the Wall Street Journal.  (Our MC was just renewed in July and it has the chip.)  If your card(s) does not expire soon, you can call your bank and ask when they will make chip cards available.  Then ask for a re-issued card when they start issuing chip cards.  Remember, the more people call, the sooner banks will decide it is in their interest to make chip cards available.

The thing is, many large merchants already have chip terminals at the register, you just have not noticed them.  Instead of swiping at the side, you stick your card in a slot at the bottom, leave it for the transaction, and then pull it out when the terminal tells you to.  At this time, you likely will sign for the purchase, but eventually you will need to use your PIN instead of a signature.  Here is picture of the chip terminal with a swipe slot:

To help prevent card fraud, you can start using the chip slot now as long as you have a chip card.  BUT you have to look for them....Walmart and Sam's Club have switched over to the chip terminal here in NM, but unless you notice the slot and use your chip card, you would never know.  This will become common knowledge and all over the news and with loads of notices in your bills as this change occurs over the next year, but you can start now.


To summarize:
1. Physically grab and WIGGLE the card reader slot at a gas pump before using it.  If it moves or breaks away, it is a SKIMMER.  You will not break the real gas pump reader.
2. Get yourself a chip card. Call your bank and ask, so they know people want them sooner rather than later.
3. Start switching from swiping to using the chip slot as soon as you can.
4. Set up a PIN with your chip card so you are ready to use it when the full chip and pin system is up and running, or if you get lucky and take a trip to Europe.

Last but not least, I love our bank.  USAA.  You do not have to have any connection with the military to use their banking products (just for their insurance products).  Top-notch customer service, I can do everything online or on the ipad/iphone apps, even deposit checks, get the RV loan, check balances, transfer funds, pay bills, everything.  And they still pay interest on checking accounts.  No ATM fees either, at ANY worldwide ATM (unless you withdraw more than 15 times a month).  And they were just named the best bank in the USA for the 5th year in a row.  Let me know if you want more information.