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[C1224]Credit Card Number Theft

by Debbie Dragon, Deb

Almost everyone understands the benefits of a single-use camera when on vacation- you have a camera that lets you capture the memories, but you aren't stressed about ruining or losing the camera on adventurous trips. A single-use credit card is designed to help prevent identity theft, and they are typically referred to as “virtual credit card numbers”.

Virtual credit card numbers are used when shopping online, so that you never actually enter the number found on your credit card. How does this help? The virtual number can only be used at the web site where you make a purchase, and only for a limited amount of time. This protects you in the event that hackers have obtained your credit card details during the submission process, as they will not be able to use that number anywhere else in order to make a purchase. It also protects you when shopping with online merchants who may not be trust-worthy. The only merchant's credit card processing system typically sends the details directly from your screen to the credit card processor- but in some cases, an untrustworthy merchant may have set it up to enable themselves to get a copy of each person's credit card details. A virtual card number makes it impossible for the retailer to take the number and go shopping elsewhere, as well.

When virtual credit card numbers are used in place of the physical credit card number, the credit card statement will show the purchases made with virtual numbers in the same manner. Some card issuers will even provide you with the virtual number used when making the purchase along with the charge- for your information.

Advantage of Using Virtual Card Numbers

Many people decide not to make purchases online because they are afraid that their credit card numbers will be stolen and they will become victims of identity theft. Approximately 7% of online shoppers claimed to be victims of identity theft, according to a survey conducted in September of 2002.

Almost all credit card issuers provide a zero liability policy for unauthorized charges and for online purchases, consumers are still concerned about shopping online because of the potential for ongoing identity theft problems that can occur. For example, it is sometimes extremely difficult to repair a credit report and credit score after becoming the victim of an identity theft crime.

Disadvantages of Using Virtual Card Numbers

Even with all of the advantages provided by using virtual card numbers when shopping online, virtual credit card numbers do have a few disadvantages over using your physical credit card number for making online purchases.

It may be impossible to use virtual card numbers when reserving theater or airline tickets online, or when reserving your car rental or hotel accommodations. When you arrive for your tickets or reservations, often these establishments require to see the credit card used to make the transaction. If you've used a virtual credit card number, handing them the credit card isn't going to confirm you are in fact the cardholder since the physical number doesn't match the virtual number used to make the reservations.

It's also not possible to use a virtual card number when shopping for recurring subscription programs. By the time your next payment is due, the virtual card number will have expired and your payment will not go through.

Precautions Against Identity Theft & Fraud

While a virtual credit card number can eliminate many concerns regarding online shopping, it's always a good idea to take precautions on a regular basis against identity theft and fraud.

When shopping online, always confirm the site is secured to handle the transaction of your personal payment information. Most sites are secured with the SSL system and is recognized by web site addresses beginning with “https” rather than “http”, and sometimes there is an image of a little lock on the screen.

Credit card safety is more important than ever, now that identity theft has become big business. Not only can a credit card thief use it to run up huge debts in your name, the talented ones can use it to gain access to even more of your personal information.

You cannot completely eliminate risk, but you can take steps to minimize it.

The first thing you should do with every credit card is record the number, the expiration date, the numbers on the back, and the number to call if your card is lost or stolen. And keep this record in a safe place where it can't be easily accessed by prying eyes.

A safe or a safe deposit box would be a good place. A file in your laptop labeled "Credit card numbers" would not be a good place, especially if you carry your laptop with you.

Next, never leave your purse or wallet out of your sight. If you must leave either in an employee break room or in a gym locker, leave your credit cards either at home or tucked in your pocket. Your checkbook should also be at home or on your person at all times.

A locked car is not a safe place, even in a well-lighted parking lot.

Restaurants can be dangerous.

Every day in restaurants across the nation, credit card holders are leaving themselves wide open to credit card and identity theft.

How? By handing their cards to their servers when the bill is presented. The servers take the card, run it through the machine, and bring the receipt back for a signature. Most of the time, that's fine.

But it takes only one dishonest employee to take an impression of the card and make note of the numbers on the reverse. Think how many card numbers a person could accumulate over one week-end in a busy restaurant. The wait person is probably not the end user of these numbers, but instead is the middle man - gathering the numbers to be sold.

Telephones are dangerous, too.

There's just one hard and fast rule to use with regard to telephones: Never give out any information - whether it's your credit card number, your address, or even your date of birth - unless you are the one who placed the call.

When anyone calls you asking for private information, hang up. Even if they seem to know all about you, and can tell you your credit card account numbers - don't talk to them. Even if they say they represent your bank or your credit card issuer - Hang up and call the number you have on file. Never call a number they give you.

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Both Debbie Dragon & James Exum are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

Debbie Dragon has sinced written about articles on various topics from Finances, Credit Cards and Kitchen Home Improvement. Destroy Debt offers tools and advice advice to help you .. Debbie Dragon's top article generates over 165000 views. to your Favourites.

James Exum has sinced written about articles on various topics from Credit Cards, Gas Prices and Credit Cards. BestRateForCreditCards.com is your on-line resource for comparsions. James Exum's top article generates over 8100 views. to your Favourites.