Privacy and Security

Credit cards and debit cards have become the most popular payment options for Canadians. Most people today prefer paying with plastic to handing over cash and cheques. At the same time you should be aware of the potential for credit card and debit card fraud.

How do these types of fraud work?

Credit card fraud comes in two main forms.

• Criminals can steal your actual card or obtain your credit card number, often by phishing or vishing.
• They can also produce counterfeit cards and get credit cards issued to them by making false applications using your identity.

According to the RCMP, criminals target students, new Canadians and people who have experienced credit problems by offering them low-interest credit cards for a fee. People who pay the fee never get a card and never see their money again.

Debit card fraud occurs when a criminal obtains your debit card information and Personal Identification Number (PIN). Without your PIN the debit card is useless, so if your card is stolen or duplicated the criminal must try to find out your PIN. That’s why protecting your PIN is so important.

• In one method, called “skimming,” consumers have provided their debit card to make a payment, and the merchant swipes the card through a hidden device to obtain the information embedded in the magnetic stripe so that a duplicate of the card can be made. At the same time, a camera records the consumer entering their PIN.
• In another, the debit handset, where you input your PIN, is “swapped out” with another that either records the entered information so that the fraudster can steal it back later and gain access to your accounts, or wirelessly transmits the data to the fraudster, located nearby.
• Finally, ATMs have been tampered with to either record or transmit the customer’s card details and PIN.