The 20 Worst Credit Card Scams & What to Watch Out for in 2024 

 

Credit card fraud remains the top type of fraudulent activity harming American consumers, according to the most recent data from the Federal Trade Commission (FTC). Throughout 2022 and the first three quarters of 2023, a combined total of nearly 800,000 instances of credit card fraud were reported to the FTC. Heading into 2024, knowing what to look out for when it comes to credit card scams is essential for keeping your hard-earned money where it belongs.

“My top advice is to monitor your credit card statements for any suspicious activity regularly,” Andrew Latham, a certified financial planner with SuperMoney.com tells Credello. Keeping your eyes open for red flags is paramount to preventing getting caught up in a credit card scam. “If something looks off, report it immediately to your credit card company,” Latham recommends. “I check all my accounts every two weeks and have found suspicious transactions that were fraudulent on several occasions.”

So, what should you be on the lookout for? Below, we’re breaking down the 20 worst credit card scams and how to protect yourself from falling prey to scammers in 2024.

1. Phishing

Scammers may send fake emails or messages through social media posing as legitimate entities, such as banks, requesting personal and credit card information. To prevent phishing scams, always verify the legitimacy of emails, texts, and messages by directly contacting the purported sender using official contact information rather than clicking on links or responding to messages. Additionally, be cautious of unsolicited requests for sensitive information and consider using email filters or security software to detect and block phishing attempts.

2. Skimming

Skimming tactics are estimated to contribute to approximately $1 billion in losses for Americans each year, according to the Federal Bureau of Investigation (FBI). Skimming is a credit card scam where criminals deploy devices (skimmers) to gather credit card information from your card’s magnetic stripe during transactions at ATMs or card readers.

On TikTok, videos of users finding skimmers at gas station pumps, ATMs, retail point-of-sale machines, and more, are raising awareness of this issue. Credit card skimming is so prevalent that some states — like Texas and Florida — have created task forces to combat the issue.

To safeguard against skimming, inspect card readers for suspicious attachments or irregularities, especially at non-bank ATMs. Covering the keypad when entering your PIN can also add an extra layer of protection. Additionally, regularly monitor your bank statements for any unauthorized transactions, as early detection is crucial in mitigating the impact of skimming attempts.

3. Lost or stolen cards scam

When your physical credit card is lost or stolen, it becomes susceptible to unauthorized transactions. To prevent scammers from gaining access to your lost or stolen credit card, it’s imperative to call your bank or card issuer to cancel the card and order a replacement with new information. However, even that step isn’t without potential scams to follow.

In a recent interview on The Today Show, TV personality Andy Cohen recounts how he fell victim to a credit card scam after reporting his card lost. Cohen received an email and then phone calls and text messages shortly after reporting his card loss that he initially thought was from his bank, but turned out to be the beginning of an elaborate scheme to scam him.

4. Carding

Also called “washing,” this credit card scam involves using stolen credit card information to make small online purchases to test if the card is active before making larger unauthorized transactions. Usually, this tactic is utilized by scammers once credit card information has been obtained through skimming, phishing, or other means. Still, it highlights the importance of keeping a close eye on your credit card transactions and setting up credit monitoring.

5. Credit card cleaning

If you encounter an individual who asks to clean the magnetic stripe on the back of your credit card, this is a red flag. There’s no need for this cleaning to occur. Instead, scammers use this tactic to give them a reason to have your card in hand and obtain your information.

6. Fake websites

Beware of fake websites where an online platform resembles a legitimate site to deceive users into entering their credit card details. Avoid falling victim to this credit card scam by checking the URL for “https://” and ensuring a secure connection.

7. Card-not-present scams

Card-not-present (CNP) fraud involves a credit card scammer acquiring your name, credit card number, and card security code, enabling them to carry out unauthorized transactions without possessing the physical card. This type of fraud is especially prevalent in transactions lacking face-to-face interaction — like online shopping — where proof of identity is not required.

Managing information for multiple credit cards — three to four is average for Americans — poses challenges in maintaining security. One way to simplify the task is by clearing out your credit card debt to potentially reduce the number of cards in your wallet. Credello’s credit card debt consolidation options are designed to streamline the process and accelerate the repayment of multiple credit card balances.

8. Public Wi-Fi scam

When you link your laptop or mobile device to public Wi-Fi networks, like those at a local coffee shop or a hotel during your vacation, your information can become vulnerable to scammers. Public Wi-Fi networks are often less secure than private ones, making them an attractive target for scammers to monitor and record sensitive data like your credit card info.

Redditor u/FreshCompetition6513 detailed a credit card scam they experienced after logging into the Wi-Fi network at the airport in Denver. A scammer obtained their contact information and even called pretending to be their bank to “verify” the fraudulent charges to avoid detection and obtain even more information.

A similar scam tactic involves setting up a deceptive “paid” Wi-Fi network in public spaces, where scammers can capture your card data when you pay to access the network.

9. Peer-to-peer payment scams

With an increasing number of people relying on peer-to-peer (P2P) payment apps like Venmo, CashApp, PayPal, and Zelle, credit card scammers have adopted tactics like impersonating bank officials and falsely verifying transactions. One way this is happening in 2024 is through an increase in “accidental” transfers. If you receive money “accidentally” from an unknown source who then asks for you to return the money, this is a red flag that they’re running a scam. It’s best to contact the P2P provider’s customer service to determine the legitimacy of the request.

10. Malware or spyware

With malware or spyware, criminals can use malicious software to capture credit card details entered on infected computers or devices. To guard against this threat, it’s essential to regularly update antivirus software and conduct thorough scans to detect and eliminate any potential malware. Additionally, exercise caution when downloading files or clicking on links, especially from unknown sources.

11. Imposter scams

Getting a call from a government agency asking for money is intimidating — scammers use this to their advantage. In 2022, imposter scams were the most frequently reported tactic, according to the Federal Trade Commission (FTC). Deceptive calls and emails, seemingly originating from entities like the Social Security Administration, Internal Revenue Service, or local law enforcement, often coerce individuals into divulging protected information. Most recently, the FTC reports that scammers leveraging potentially decreased interest rates to entice individuals to hand over their credit card info.

12. Rewards scam

Everybody likes a freebie now and then, right? But if something sounds too good to be true, it often is. During a rewards scam, scammers are likely to request your details, including credit card numbers, security codes, and account info, all under the guise of verifying your eligibility for these too-good-to-be-true rewards.

13. Shimming

This scam is similar to skimming but involves scammers attaching a paper-thin device with a microchip to ATMs and point-of-sale machines. The microchip transfers credit card information to a flash storage that the scammer can access. Because of how slim and small the shimming devices are, they’re easily inserted into credit card scanners and nearly undetectable.

In Puyallup, Washington, Chris Cironi was subjected to a shimming scam when he used a local ATM to withdraw money. According to a report from CBS, police determined that the shimming device that obtained Cironi’s credit card information was inside the ATM card scanner, so there was no way for him to have seen the device inside the card reader.

You can avoid this scam by not inserting your card into card readers and instead using the scanning chip on your card or mobile payment apps like Google Pay or Apple Pay.

14. Overcharging

Overcharge scams occur when a merchant intentionally applies an amount to your credit card that exceeds the advertised or agreed-upon price. The excess funds are then theirs to keep. Unless, of course, you catch the overcharge and contact your credit card company to dispute the charge. Once again, keeping an eye on your transactions is critical to catching credit card scammers in the act.

Recurring charges that you didn’t authorize are another form of overcharging that can scam credit card users. For example, when Redditor u/lordofwar3000 noticed recurring charges from Amazon Prime Video, it alerted them to the fact that they had not signed up for this particular service. As it turns out, this scam was intended to look like a charge to a service many people use to fly under the radar on consumer billing statements.

15. Identity theft

Identity theft often happens when a credit card scammer contacts you directly, posing as someone else, attempting to coax sensitive information from you. Be wary of unsolicited texts, phone calls, and emails, particularly if they persistently contact you after you’ve refrained from responding.

16. Identity fraud

It’s essential to understand that identity theft involves the illicit acquisition of personal information, while identity fraud entails using that information to engage in activities like stealing from you or exploiting government programs, such as Medicare, using your identity.

17. Charity scams

According to the FTC, charity scammers often capitalize on natural disasters or emergencies to camouflage their deceit. Here’s a pro tip: if a charity requests a donation through a gift card, wire transfer, cash, or virtual currency, it’s most likely a scam. Platforms like GoFundMe or Kickstarter, though equipped with anti-fraud measures, can still be exploited by scammers who create fake organizations or fabricate urgent needs (think medical emergencies or house fires). Before you open your heart and wallet, do a little detective work — research and thoroughly vet any organization or cause asking for donations to ensure your generosity lands in the right hands.

18. Social media scams

Similar to fake websites, credit card scammers will often set up fake social media profiles to obtain your information. Many of these fake profiles may link to a fraudulent website. In 2022, the largest loss reported to the FTC involved social media scams.

19. Security breach scam

When you use a credit card for transactions, your information becomes vulnerable to security breaches within the company where the card was used. With a record-breaking number of data breaches reported in the first three quarters of 2023, according to the Identity Theft Resource Center, it’s more important than ever to stay aware of this type of credit card scam. For instance, if your credit card is linked to your Amazon account and scammers breach Amazon’s security database, your credit card details may be exposed.

20. Phone scams

Sometimes, something as seemingly innocent as a good, old-fashioned telephone call can be leveraged by criminals to engage in credit card scamming. This is especially the case with older adults who don’t rely as much on modern tech like text messages and emails to communicate with service providers. Scammers may call, posing as a bank representative or other trusted entity, and request credit card information.

The best practice to avoid this credit card scam in 2024 is to screen phone calls. If someone calls you asking for credit card information, hang up, search for their official phone number online, and call the service provider directly.

Tips to protect against credit card scams in 2024

By following these best practices, you can significantly reduce the risk of falling victim to credit card scams and protect your financial information.

• Be skeptical of unsolicited requests: Be cautious of unsolicited emails, messages, or calls asking for personal or credit card information. Legitimate entities won’t typically request sensitive details through these channels.

• Verify website security: Before entering credit card information online, ensure the website is secure. Look for “https://” in the URL and check for a padlock symbol in the address bar.

• Monitor your statements: Regularly review your credit card statements for unauthorized or suspicious transactions. Report any discrepancies to your credit card issuer immediately.

• Use two-factor authentication: Enable two-factor authentication whenever possible, especially for online accounts linked to your credit cards. This adds an extra layer of security.

• Protect personal information: Avoid sharing personal information, such as credit card details, over the phone or online unless you initiate the transaction and are certain of the recipient’s legitimacy.

• Update software and antivirus programs: Keep your computer, smartphone, and other devices up to date with the latest software updates, and use reputable antivirus programs to protect against malware.

• Secure your physical card: Keep your physical credit card in a secure location, and report lost or stolen cards immediately. Sign the back of your card as an extra precaution.

• Check for skimming devices: Before using ATMs or card readers, inspect for any unusual devices or attachments. If something looks suspicious, use a different machine.

• Educate yourself: Stay informed about common scams and tactics used by fraudsters. Awareness is a key factor in avoiding potential threats.

• Use secure Wi-Fi networks: When making online transactions, use secure and trusted Wi-Fi networks. Avoid using public Wi-Fi for sensitive activities.

Bottom line

As credit card fraud continues to rank as the predominant form of identity theft, it’s more important than ever to regularly monitor your credit card statements and promptly report any suspicious activity to the card issuer. Staying informed about evolving scam tactics and adopting proactive measures are crucial to safeguarding your financial well-being against these prevalent threats.