My credit-card company called me and said that somebody tried to charge a penny to my account. When I explained that it wasn’t my charge, the issuer canceled my card and sent me a new one. Was this an identity thief at work? In the future, what can I do to protect myself from identity theft?
This is a common ploy for ID thieves, who test out your credit card with a small charge and then, if it goes through, start making big purchases. Crooks may even use programs with algorithms that run 16-digit numbers until they get a hit. Then they try to charge a penny or a dollar or two, making it look as if a charity is the recipient, says Adam Levin, chairman of Identity Theft 911, which sells ID-theft prevention services to businesses. “They’re hoping that because of the small size of the transaction, it will slip through filtering systems.”
Another trick ID thieves use is to impersonate an employee of your bank’s fraud department and fish for your sensitive information. After offering enough of your personal details to get in your trust, they may ask you for your Social Security number or the security code on your credit card. If you get a suspicious call, call the customer-service number on the back of your credit card.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
It’s a good idea to regularly check your bank and credit-card balances online for suspicious transactions. You should also check your credit report to see whether anyone has applied for credit in your name. You can get one free credit report per year from each of the three credit bureaus at www.annualcreditreport.com. You could also put a credit freeze on your account, which blocks potential lenders from getting access to your credit report without your authorization. (Your current creditors are exempt from the freeze, and you can make charges to your current cards without unfreezing your account.) The protection works only if you freeze your credit at all three bureaus (Equifax.com, TransUnion.com and Experian.com). It generally costs $10 at each bureau to freeze the account and $10 to unfreeze it.
-
What Is a Qualified Charitable Distribution (QCD)?Tax Breaks A QCD can lower your tax bill while meeting your charitable giving goals in retirement. Here’s how.
-
Embracing Generative AI for Financial SuccessGenerative AI has the potential to reshape how we approach learning about and managing our personal finances.
-
How to Guard Against Identity Theft in 2025Scammers are getting better at impersonating legitimate businesses.
-
Social Media Scams Cost Consumers $2.7B, Study ShowsScams related to online shopping, investment schemes and romance top the FTC's social media list this year.
-
Tired of Scam Text Messages? The FCC Cracks DownNew scam text message rules from the FCC require carriers to block texts from bad numbers and protect consumers.
-
Tax Scam: IRS Warns Taxpayers Against Filing False W-2 InfoScams A new tax scam on social media advises lying on your W-2 to falsely claim credits and bigger refunds.
-
Beware Fake Disney Plus Emails That Steal Your Bank InformationFake Disney Plus billing messages enable scammers to access your bank account and drain your funds.
-
Watch Out for Flood-Damaged Cars from Hurricane IanBuying & Leasing a Car In the wake of Hurricane Ian, more flood-damaged cars may hit the market. Car prices may rise further because of increased demand as well.
-
The Best Way to Protect a Parent from ScammersScams Adult children worried about their parents’ ability to spot and avoid fraud have several options to help protect them, including a durable power of attorney, a guardianship and a revocable trust. Which might be best for your family?
-
How to Avoid a Summer of Scams – Expert Tips to Help Aging ParentsScams Financial professionals share their top tips to help avoid becoming a statistic in a summertime wave of identity theft, account hacks and telemarketing fraud.
