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Monday, May 20, 2024

My Credit Card Was Used Fraudulently: Here’s What to Do (Feb. 2024)

My Credit Card Was Used Fraudulently Heres What To Do
Eric Bank

Written by: Eric Bank

Eric Bank
Eric Bank

Eric Bank is an M.B.A. who has covered financial and business topics since 1985, appearing regularly on Credible, eHow, WiseBread, The Nest, Zacks, Chron, and dozens of other outlets. Eric specializes in taking complex subject matters and explaining them in simple terms for consumer audiences, particularly in the world of personal finance. Eric holds a Master's in Business Administration from New York University and a Master's in Finance from DePaul University.

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Edited by: Lillian Guevara-Castro

Lillian Guevara-Castro
Lillian Guevara-Castro

Lillian Guevara-Castro brings more than 30 years of editing and journalism experience to the CardRates team. She has written and edited for major news organizations, including The Atlanta Journal-Constitution and the New York Times, and she previously served as an adjunct journalism instructor at the University of Florida. Today, Lillian edits all CardRates content for clarity, accuracy, and reader engagement.

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Advertiser Disclosure

Even with today’s increased security measures, credit cards can still be susceptible to fraud. Just a few months ago, my credit card was used fraudulently. Thankfully, I was able to recover the funds lost through the duplicitous purchases. If you find yourself in a similar situation, and your credit card was used fraudulently, here’s what to do.

The IRS’s advice is to place a “fraud alert” or a “credit freeze” on your credit account. You can also use a credit monitoring or identity-theft-repair service, and you can choose credit cards that provide extra protection from fraudulent losses. The first step you need to take, however, is to notify your credit issuer. We’ll dive into this topic in the following article and walk you through the process of how to protect yourself from future fraud and possibly recover the stolen funds.

Contact the Card Issuer

Upon learning of the fraud, immediately contact the card issuer, who will cancel and replace your card, thereby stopping any further fraudulent use. Once contacted in a timely fashion, the card issuer will absolve you of liability for any further use of the card.

Federal law limits your liability to $50 if you report the fraud within two business days after it comes to your attention. The maximum liability increases to $500 if you wait longer than two business days to make the report. If you delay 60 days without speaking to the card issuer, you may be responsible for all fraudulent losses.

Note: When you receive your replacement card, don’t forget to update the account number at all the places that use your credit card for auto-pay arrangements.

Request a Fraud Alert

Requesting a fraud alert is critically important in order to limit further damage after your credit card was used fraudulently. A fraud alert makes it harder for the fraudsters to create new bank or credit card accounts under your identity. Once in place, a fraud alert will red-flag your account to credit issuers, including gas stations and department stores, warning them to request supplementary proof of identity.

If you become a victim of fraud or identity theft, immediately call one of the three bureaus and also order free copies of your credit reports. You only need to call one of the credit bureaus for a fraud alert, as that bureau will automatically alert the other two.

  • Equifax: 1-800-685-1111
  • Experian: 1-888-397-3742
  • TransUnion: 1-800-916-8800

You can choose from among three different kinds of fraud alerts:

  1. Initial: Protects unverified persons from accessing your credit for 90 days or more. Although an initial fraud alert lasts only three months, you can renew it if you so wish. This is a prudent safeguard if you misplace your wallet containing identifying financial and personal information, credit/debit cards, your Medicare or Social Security card, etc.
  2. Extended: Will protect your credit for the next seven years. According to the FTC, “When you place an extended alert, you can get 2 free credit reports within 12 months from each of the 3 nationwide credit reporting companies, and the credit reporting companies must take your name off marketing lists for prescreened credit offers for 5 years, unless you ask them to put your name back on the list.”
  3. Active Military Duty: Available to protect active-duty military personnel for one year following deployment, an Active Duty Alert means businesses must take extra security measures prior to granting credit in your name.

Request a Credit Freeze for Extra Protection

If you need extra protection because your card was defrauded or your identity was stolen, you can request a credit freeze instead of a fraud alert. The freeze allows you to curb access to your credit reports, which helps prevent fraudsters from discovering your other accounts and credit cards.

You have to request a separate credit freeze from each of the three credit bureaus, and you may have to pay fees. Each bureau will provide you with a password or PIN that you can later use to terminate the credit freeze.

Sign Up for Credit Monitoring & Identity Theft Services

There are two distinct types of services available that can help when you’ve been a victim of credit card fraud:

Credit Monitoring

These services will inform you of and/or confirm new credit activity – anything from the opening and use of credit cards to changes in your credit scores to requests for address changes. TransUnion offers credit monitoring for all three bureaus; they will also grant you access to your TransUnion credit score, report, and email alerts to any changes to your report.

$1 TransUnion Credit Monitoring

Try it for one week for just $1, and continue services thereafter for the low cost of $16.95/month.

Identity Theft Protection

No one can prevent identity theft, but firms offering identity theft protection pledge to take whatever steps are necessary, up to some financial limit (usually $1 million), to correct the problem. Identity Theft Protection will monitor your credit, help you replace the contents of your wallet (credit cards, insurance cards, etc.), make corrections to your creditors and the credit bureaus, and will even provide lawyers if you need them.

Use a Credit Card with Additional Fraud Protection

Some credit cards are safer than others, in that they provide fraud protection coverage beyond the federal limits. Look for cards that offer zero liability for credit and debit cards, and ATM transaction protection better or equal to the federal limits.

Four excellent candidates are the cards from American Express, Discover, MasterCard and Visa. The latter two offer full protection for debit PIN card transactions.

Advertiser Disclosure is a free online resource that offers valuable content and comparison services to users. To keep this resource 100% free, we receive compensation for referrals for many of the offers listed on the site. Along with key review factors, this compensation may impact how and where products appear across (including, for example, the order in which they appear). does not include the entire universe of available offers. Editorial opinions expressed on the site are strictly our own and are not provided, endorsed, or approved by advertisers.