3 Common Causes of Credit Card Fraud [Complete Guide]

By: Yara Pollard

Credit cards have been a great help to a lot of people. Because of credit cards, people can make major purchases such as buying a house and a car. Moreover, some people depend on their credit cards to buy food and other day-to-day necessities.

According to Forbes, one in five Americans depend on their credit cards for their basic living expenses. Data from the Federal Reserve also showed that the average American has at least four credit cards and that 83% of Americans possess at least one.

While credit cards have been much help, credit card fraud has been an issue. With better technology such as EMV chips, credit card fraud has been less of a problem although a lot still experience this issue. 

Knowing the different causes of credit card fraud can help save you from becoming a victim. Here are 3 common causes of credit card fraud:


According to Pocket Money, skimming is a process where sensitive information can be stolen from your credit card’s magnetic strip, enabling criminals to make a duplicate of your card.

The online consumer database of the Federal Trade Commission compiled 13 million complaints from the years 2012 to 2016. It was found that 42% of those complaints were related to credit card fraud cases while 13% were related to identity theft cases.

After copying information stored in a credit card’s magnetic strip, this can be installed in a counterfeit card. With valid information stored on this new card’s magnetic strip, criminals are able to make transactions using your credit card details without you being able to notice.

There are a lot of credit card skimming machines and you need to be aware of them. According to The Balance, a credit card skimmer can  be placed in any credit card reading device. Some ATMs even have hidden cameras installed by criminals to spy on clients’ pin numbers.

According to FICO’s Card Alert Service, the number of compromised credit cards at ATM machines and stores rose to 70% in 2016. This statistic shows you that a huge number of ATMs and stores have been installed with skimming machines to steal credit card information.

Eva Velazques, CEO and president of the Identity Theft Resource Center said, “Sometimes, in order to avoid being caught in a skimming scam, you have to modify your behavior. It’s not always about detecting the skimming device.”

It pays to make a habit of checking the card reader before making a transaction. With fraud and identity theft as a danger, there’s no harm in being extra vigilant with the machines you use to make your transactions.

Retails stores have been issuing their own credit cards as well. Whether what you have is a Best Buy credit card, Walmart credit card or other regular credit cards, be sure to check your credit history on a regular basis. This helps you detect abnormal transactions and take action early on. 


According to Credit Card Insider, phishing is a type of scam where criminals target a specific customer by pretending to be legit companies.These scams can come in the form of emails, phone calls and text messages.

FBI’s Internet Crime Complaint Center says that people have lost an estimate of $31 million all in one year due to phishing. Recent credit card phishing cases have also been occuring in social media platforms like Instagram and Facebook messenger.

Scammers pretend to be friends or site administrators to get you to share private information. They make use of links which they have you click in order for them to gain access to your email account and etc.

According to PhishMe’s Enterprise Phishing Resiliency and Defense report back in 2017, phishing attempts have been growing up to 65% in the past year. A way to avoid all of this unwanted situations is to be cautious of the emails you receive.

Emails pertaining to credit card statements wherein you would need to enter your credit card details are something you would want to be most careful of. Here’s a tip. According to Business Insider, most phishing emails have spelling or grammar errors.

This makes the detection of phishing scams easier. By knowing this, it is important to read through and be careful of emails you get before clicking any links or providing sensitive information.

Information sharing

Another cause for credit card theft is information sharing. This is when you:

  • Post pictures of your credit cards online showing important details.
  • Sharing credit card details on social media.
  • Giving your details through email. 
  • Sharing personal details through phone calls and texts.

A lot of people don’t know this but posting pictures of your credit cards online can endanger you. Anyone with ill intentions can steal your credit card information just through the photos of your credit card.

Even when people make an effort to censor their account numbers, they make the mistake of just covering the first sequence. The first sequence on your credit card number is not unique to just you and is just to determine the issuer of your credit card. 

Here are examples of social media accounts and trends that have been infamous for gathering photos of debit and or credit cards:

  1. Needadebitcard from Twitter.
  2. Hashtags relating to credit cards such as #visagold
  3. Accounts, pages and groups that promote sharing of credit and or debit card photos

While it’s understandable that we can all get excited with new credit cards, never share photos of your credit card on the internet. 

Anyone can become a victim of credit card fraud but this doesn’t mean that using credit cards aren’t safe. To avoid becoming a victim of credit card fraud, be responsible, vigilant and aware of scams, schemes and common mistakes people commit that lead them to identity theft. 

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