Fraudulent Purchase

A little bit of paranoia never hurt anyone, especially when it comes to protecting your personal finances. Unfortunately, there are numerous ways your banking/credit information can be compromised so don't just single out the business where you made your last purchase (although it is a good place to start). My credit card was compromised a year ago and my institution was really helpful in getting the compromised account closed and a new account opened.

The credit card system is obsolete and needs a total overhaul. Long story short, they only need to compromise 12 digits in most cases, not the 16 + 4 + 3 they should have to.

Because most banks use the same 8 initial digits for all their cards, or most of them, (last time you got a new card number from the same bank, I bet it has the same 8 digits as the other one), that eliminates 8 of the 16 numbers they have to know. That leaves just 8 numbers + the 4-digit expiration date. And since computers can perform millions of operations per second, it doesn't take them very long to come up with a solution that works. The 3-digit confirmation number isn't even required for most kinds of transactions.

In the modern computer age, your card will get compromised from time to time, even if you never use it even once. You could do no more than activate your new credit card, and leave it unused, and it will probably get compromised eventually.

Practically all US-based computer transactions, however, don't even give them an opportunity to steal your number. Card processing systems are so secure and so automated that there is almost no way for them to get your number. What you have to worry about more are face to face transactions, restaurants, and such. Any time the card is physically taken out of your sight, it opens the opportunity to someone copying down the information.

However, because it is a credit card, you are not responsible for any fraudulent purchases made against your card. Not so with a debit card. Credit cards are THE safest means of doing business as a consumer. However, you pay for this protection and convenience by occasionally finding that your card won't work.

I hate to say it, but suspect it's gonna get worse. I've had my credit card info stolen twice this year. Once back in March and again just two weeks ago. Both times I had to reopen a new card account.

I caught the first credit card account theft and was able to reverse all charges and I had to file a police report.

The second credit card account theft was caught by the card's risk management division which found a charge of 22 cents that I didn't make.

What card companies need to go is to go alphanumeric. It will reduce convenience slightly by making it harder to remember, but make it exponentially harder for computers to break your number. A 16-digit alphanumeric code is obscenely hard for computers to crack.

Additionally, I've noticed that the supposedly secure "confirmation code" on the back of the card is, in all the cases I've seen, always comprised entirely of numbers that appear in the main credit card card number at some point.

I prefer cash. I always thought that was the best way to purchase "things", at least it has worked for me for the past 15~16 years.

You forgot to mention the biggest flaw in online/internet purchases. Keyloggers, they're still here, a majority of of users don't keep they systems updated, but that wouldn't make much difference , everything available for security is reactive anyway.

I'm a victim of stolen card info too. Just a week ago. The theift charged $2 on Napster.com, $25 on blockbuster.com, and then tried $2300 on Airline tickets. that raised some red flags and i got a call from the bank. i filed a report with the police, but i'm not sure if that'll do any good. i've been buying lots of ammo and mags online lately. I'd hate to think that's what caused this mishap...

They got my Chase card last week. Sunday actually. I got a call from the fraud department and they started asking me about charges and I said I hadn't used the card in a week and it's been locked up at home. Total was like $3,500 in charges. Had a new card in my hands on Tuesday (today).

Yep. My wife's and I's debit card has been hit three times in the last year and a half. I check my account online at least weekly. Don't know if you can do this with credit cards or not, don't use them.

I'm an idiot. Disregard.

Another word of warning, one of my wife's clients (she works in a CPA office), had someone deposit $0.75 into one of her accounts. Once that worked they stole thousands of dollars. This person spent a lot of time and energy trying to fix the situation.

Bottom line, suspect ANYTHING you don't recognize.

Happened to me once. I'm still not sure who got the number or how. I only found out when I tried to purchase something at an electronics store and was told my acct. was on hold. Turns out they ran up over $1000 in purchases at drug stores across 2 states in 24hrs (someone had a prescription methinks).