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There are many types of scams out there. Here are just a few, including information on how to recover what you lost. Make sure you know your consumer rights.
There are multiple varieties of debit card fraud, and you might not even be aware that a scam has hit you until you go through your bank statement. This section will look at the nature of debit card fraud and how you can recover your money and protect yourself in the future.
When your debit card details are taken by someone and used in transactions without your knowledge or approval, it is known as debit card fraud. Your bank should deactivate your card when you report any fraudulent transaction made to prevent further transactions and loss of funds.
It is very important to ensure that all the transactions on your account are legitimate by regularly keeping tabs on all your transactions by carefully going through your debit card statements. This will enable you to immediately spot any unusual activity on your card.
Scammers use many different methods to obtain your debit card details:
If you notice that your debit card is missing and has likely been stolen, report it to your bank immediately so that it can halt all transactions taking place on your account and issue a new card.
The Electronic Funds Transfer Act (EFTA) states that cardholders will face higher liabilities the longer they wait to report the loss. For example, if the loss or theft is reported within the first two days, the cardholder is liable to be charged up to $50. If the loss is reported after up to 60 days, then the liability will increase to $500. Once the 60 days have been exceeded, the bank is no longer obligated to refund any amount lost due to fraudulent activity. This means that you will be liable for the full amount.
Although filing a debit card fraud claim does not ensure a refund, it could be the best option for cardholders when all others have failed. Let’s look at the steps to facilitate a smooth refund process:
Payments made through electronic bank account transfers are known as Authorized Push Payments. Frauds involving these sorts of payments are known as Authorized Push Payment Fraud. Unauthorized bank transfers are a common scam many people worldwide face. In this section, we shall look at the various ways in which it can happen, and what steps to take should you encounter any such issue.
Unauthorized bank transfers can include electronic transfers such as ATM transactions, online bill payments, and payments that have been set up to take place automatically from your account.
Scammers who perpetrate this kind of fraud will often use socially engineered attacks that involve impersonation. For example, you may get a call from someone claiming to be a representative of your bank’s fraud team. He or she will tell you that you need to transfer your funds to a safer account, which in reality, is controlled by the fraudster.
Fraudsters will often employ fairly elaborate steps to scam their targets in this sort of scam:
Should you come across any unauthorized payment made from your account and you have not lost your debit card or credit card, notify your credit union or bank immediately. You will need to inform your bank within 60 days of receiving your bank or credit card statement, which reflects the unauthorized transfer. Should you fail to do so, you may be required to pay the full amount from the 60 days till the time you reported it.
Upon notifying your bank, it usually takes about 10 working days to investigate the matter. If your account has been active for a period of fewer than 30 days, it would take 20 working days. The bank must take corrective action within one working day after confirmation that an error has occurred.
If the bank cannot complete its investigation within 10 or 20 business days, it is required to issue a temporary credit to your account. They must credit the lost amount minus $50 maximum, while the investigation continues.
However, there are circumstances under which your bank is not required to issue this temporary credit. For instance, if you have reported the matter over the phone, you will have to submit a report in writing. If you take longer than 10 working days for this, the bank does not need to issue you with the temporary credit amount.
The bank is then required to sort out the matter within 45 days. This is unless the transactions in question took place in a different country, were point-of-sale purchases made by debit card, or took place within 30 days of opening the account. In such cases, you might have to wait as long as 90 days for a resolution on the matter.
Between 2109 to 2020, there were more than 400,000 cases of credit card fraud, according to reports made to the Federal Trade Commission (FTC). It is important to detect such scams early and take swift action to minimize the damage done.
Credit card fraud involves using another person’s credit card details and account to make fraudulent purchases. Scammers do this by stealing credit cards, or credit account numbers, or PINs. They can also open new credit accounts in your name without your knowledge.
Scammers will then run up exorbitant charges and stick you with the bill.
Fraudsters can obtain your credit card details from your credit card company and use your personal information, which they would have obtained earlier. They will then proceed to change your passwords, access PINs, and mailing address. Now they will have full control over your account while you are locked out.
Electronic gadgets known as skimmers which are used at retail cashier terminals and gas stations, allow fraudsters to obtain your while you swipe. They will then use these details to make “cloned” cards for their use.
There are also instances where the use of credit card details without the actual physical credit card is sufficient. This is mostly the case with online purchases.
If you feel you might have been targeted for credit card fraud, you can approach consumer credit card reporting companies and have a fraud alert placed on your credit report. When such an action is taken, all potential lenders must ensure proper identity verification before issuing any new accounts. Making the report with one credit bureau is sufficient to put a fraud alert in place on all your credit reports. The fraud alert may be canceled at any time.
You can also report the fraud to law enforcement. Visit the FTC’s website- IdentityTheft.gov, to initiate this process. Law enforcement departments and agencies can use any report of theft or fraud you file here to investigate the matter.
You may ask your credit card provider for a chargeback. You will be issued with a reason code while your case is under review. This code gives the reason why the transaction is in dispute. If the claim is valid, then the money is removed from the merchant’s account and transferred to the cardholder’s account.
Paypal is a very popular method of transferring money online. With over 300 million users across the world, the company needs no introduction. However, its popularity has a serious downside.
Like many other mediums for financial transactions, Paypal transfers are extremely vulnerable to scams and fraudsters. As such, it is very important to know what can be done by customers and Paypal to resolve such issues.
Shipping Address Fraud- A scammer will ask you to ship items to a particular address, and money is wired to your account. However, the delivery address given to you is invalid, and the delivery company will be unable to find it. Following multiple attempts, the item was flagged as undeliverable in their records. The scammer will then contact the delivery company with the shipping address. After receiving the item, he will file a complaint with Paypal that the item was not delivered. Paypal will reimburse them, and you will be required to pay an amount to the scammer’s account for the overpayment.
Be sure not to wire money to someone you don’t know. Genuine customers will not overpay. Legitimate prizes don’t require payment to receive. If an investment that supposedly offers zero risks seems too good to be true, it most probably is.
If anyone claiming to be representing a charitable organization, you can always verify the group’s credentials online. Several websites contain lists of known and reputed charitable organizations. If the charity that contacted you is not listed on any of these and does not have its website, then avoid any further interaction with them.
If you suspect you may have been a victim of fraud via PayPal, you can ask for a refund, inform your credit card company about the transaction, and ask them to cancel it. In banking terms, this is known as a chargeback. PayPal will then freeze the funds in the seller’s account. Reasons for a chargeback include:
In PayPal chargebacks, sellers incur a chargeback fee. However, this fee can be waived if the seller has availed of the Seller Protection Policy. Chargebacks can be better managed using the Breakthrough app. Here’s a quick run-through of the chargeback process:
Unfortunately, the chances of getting your money back from scams involving cash payments are slim. You could file a report with your local police department or tradings standard and see if they may take any action.
Every year consumers in the US lose money, going into the millions to scammers who utilize wire transfers to cheat unsuspecting people out of their money. Businesses like Western Union and Moneygram provide people with a fast and convenient way to send money to relatives, friends, and others.
Con artists utilize these facilities to trick people into sending out money to strangers who may often be in a different country. They use many different methods to hook their targets initially. But in all instances, after the initial hook, victims are persuaded to transfer out money, which is lost permanently. That all being said, watch out for robocalls and learn how to stop them before they dupe you.
Targeted persons will be requested to transfer money. They might be sent a check along with a payment request. Scammers will often gain their victim’s trust by sending them a fraudulent check with an amount that is greater than the purchase cost, which they might often claim is to cover so-called shipping charges, processing fees, or other expenses. They will tell the victim that the check needs to be cashed and then instruct them to wire out some of the money.
Gather all information you might have about the transaction, and get in touch with the Internet Crime Complaint Center of the FBI. Make sure to include all possible information, like email content or any links shared with you. Once the report is filed, you will be given an IC3 complaint number. Be sure to record this number for future steps. Drop in at the local FBI field office in your hometown, and furnish the concerned cybercrime agent with your IC3 complaint number.
After this, file a report with your local police department. Provide them with the same details and information you had given to the FBI and any other concerned authorities. You will be issued with a police report number or incident number. You will need to save this. Additionally, do obtain the contact information of the officers investigating your case, so you can follow up with them.
If you have sent a wire transfer through the US postal service, you will need to submit the documents about the transfer. After having reviewed them, they will decide about issuing a refund. Wire transfer services like MoneyGram may not give you a refund. However, they are required by law to look into your complaint.