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MasterCard
Security Alert:
Specific Things You Can Do to Protect Yourself From Credit Card Fraud and
Identity Theft
The largest security breach to date occurred late last week when 14
million MasterCard and 22 million Visa credit card numbers were hacked. Up
to 40 million credit card users may now be at risk of fraud from their
MasterCard, Visa and other credit cards.
The security breach took place at CardSystems Solutions, a third-party
transaction processor for merchants and financial institutions.
It appears that the breach was caused by a hacker who gained access to Card Systems'
database and then installed a virus-like script that captured customer
data. The F.B.I. is investigating the security breach.
According to MasterCard, names, credit card numbers, expirations dates
and the three or four digit credit card security codes were stolen. Social
Security numbers, birth dates or other highly sensitive personal data were
not part of the security breach.
MasterCard said that only 68,000 of the 13.9 million MasterCard holders
were at "a higher level of risk."
MasterCard, as well as some other credit card providers, have
zero-liability policies, so consumers who find unauthorized charges made
on their credit cards will not be responsible for paying for the charges.
This security breach is simply the latest, albeit the largest, in a
long line of breaches reported this year. Security breaches or lost
computer tapes have been reported this year by ChoicePoint, LexisNexis,
Citigroup, Bank of America, Stanford University, United Parcel Service,
and many others.
Since there have been a relentless string of security breaches -- both
online and offline -- this year, we offer 7 specific suggestions of things
you can do to help protect yourself from credit card fraud and identity
theft taken from ScamBusters.org:
1. Check all your credit card and bank statements very carefully. If
you have access online to your credit card charges and/or bank accounts,
we recommend you check your statements frequently so you can spot
problems as early as possible.
2. If you find any unauthorized charges on any of your credit cards,
notify your card issuer immediately.
3. If you discover a problem, follow the advice in this ScamBuster's
article: "What
to Do if Your Credit Card or Wallet is Stolen." See also: Credit Card Fraud: 21 Tips to Protect
Yourself, taken from ScamBusters.org
4. Consider using one-time use credit card numbers, called
"controlled payment numbers" or "virtual account
numbers," for your online purchases. Controlled payment numbers
help protect your privacy and your security. They are substitute numbers
that let you shop online without using your real credit card number.
Check with your bank or credit card vendor to see if this service is
available to you. If it isn't, DEMAND that they provide it.
Typically, controlled payment numbers expire after one use (although
their use can be extended for repeating monthly bills). These substitute
numbers link back to your credit card number without you ever having to
reveal your actual credit card number when you shop.
The benefit is that if the substitute credit card number is stolen,
such as in this case of the 40 million MasterCard and other credit card
numbers, the substitute number would be worthless and your real credit
card number would not be compromised.
Currently, we know of two credit card issuers who offer this service:
Citibank and Discover Financial Services. MBNA Corp. and others may also
offer this service (however, we could not find a public link).
For more info, visit:
Citibank (Virtual Account Numbers)
http://www.citibank.com/us/cards/tour/cb/shp_van.htm
Discover Card (Discover Deskshop)
http://www.discovercard.com/deskshop/
5. Consider purchasing a credit monitoring service. These services
typically offer periodic copies to your credit reports so you can
monitor your credit file, email alert notifications of key changes in
your credit reports, identity theft insurance, and personal customer
service help.
Note: Some people have very strong negative feelings about
these services. They believe these services should be free to everyone,
and that having to pay for them is completely unfair. We respect that
opinion.
Our belief is that regardless of whether or not these services *should*
be free, the fact is that they aren't. So, we believe the more practical
question now is whether or not these services provide sufficient value
to you to be worth the not inconsequential cost. You are the only one
who can decide this practicality.
6. Consider putting a 'fraud alert' on your credit file with the
major credit card bureaus as a precautionary measure.
A fraud alert is an alert that the three major credit reporting
companies attach to your credit file that alerts creditors that your
private financial information has been, or may be, compromised.
This free service alerts creditors to use additional steps to verify
your identity before opening new accounts in your name.
When you place a fraud alert with one of the three major credit
reporting companies, they will automatically notify the other two
companies on your behalf, so you don't need to place the alert with all
three.
In addition to flagging your account with a fraud alert, your name
will also be removed from pre-screened offers for credit cards and
loans. And, you may well be able to receive free copies of your credit
report from all three major credit monitoring companies.
Placing a fraud alert does not decrease your credit rating. You can
remove the alert by calling the number on the credit reports you
receive.
There are certainly drawbacks to placing a fraud alert, including
that getting new credit cards and other credit may be more difficult.
For example, a fraud alert may limit your ability to get instant credit
for in-store purchases.
Creditors are asked to call you at a designated phone number before
opening new accounts, and you may be required to show additional
identification when opening new accounts.
Another drawback is that a fraud alert may not prevent a scammer from
opening a new account in your name. Creditors are asked to call and
verify all credit applications made in your name before they open any
new credit account or grant any new credit. However, creditors are not
required by law to contact you. In other words, fraud alerts can legally
be ignored by creditors.
Placing a fraud report is done by an automated system -- it is almost
impossible to speak to a human being. Here are the three agencies and
their phone numbers:
Equifax: 1-800-525-6285
Experian (formerly TRW): 1-888-397-3742
Trans Union: 1-800-680-7289
For more information, visit:
http://www.ftc.gov/bcp/conline/pubs/credit/bbcr.htm
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