You know those new credit cards with the EMV microchip that are replacing the traditional cards that rely on magnetic strips? They are not as fraud proof as you might think.
While the new smart cards do offer better security than the old ones, they are still fairly easy prey for hackers.
Smart cards can be counterfeited with the help of stolen card information purchased on the black market.
An infected terminal
Also, the new cards still have a magnetic strip in addition to the EMV chip. Data on the magnetic strip of an EMV card can be stolen if the terminal that reads it is infected with malware that steals data.
In addition, the EMV chip will at best slow down thieves using stolen or counterfeit credit cards for online or telephone purchases where the card is not seen by the merchant and where the EMV chip does not kick in.
What to do? Be careful with the cards. Sign and activate them as soon as they arrive. Check your credit card statements for red flags. Report lost or stolen cards promptly to the issuing bank.
Use the PIN rather than a signature to verify a transaction at a terminal. Shield the keypad from inquiring eyes when entering the PIN. This way the built-in security features have the best chance of working.
Merchants should require a PIN entry for each transaction for identity verification. If a signature is used, a picture ID should be requested.
Merchants should also use encryption and other security measures for sales made over the Internet or by telephone. Shred any written material. Thwart hackers at every turn.
If you are a victim of credit card fraud or have some useful information about it, contact local law enforcement.
Anyone who has had their identity stolen knows the cost in time and money that befalls the victim.