How Credit Card Frauds are Caught? How Credit Card Fraud is Investigated?

How Credit Card Frauds are Caught

Catching a credit card fraud is a very daunting task. In fact, the only way you can catch a credit card fraud is when the fraudster does it in person and is caught red-handed. In this type of situation, police or the investigating party use the CCTV footage to identify the fraudster and try to catch him/her. It might take up to 90 days to conduct a credit card fraud investigation. It totally depends on the investigation result and the card-issuing company whether you would get compensation!

What is Credit Card Fraud

Credit card fraud is a type of fraudulent activity where a fraudster uses a stolen credit card or a cloned card to withdraw money without the consent of the card owner. According to many expert opinions, credit card fraud is also regarded as a form of identity theft. The main purpose of credit card fraud is to remove all the funds from the account or charge the account for purchasing products.

How Credit Card Frauds are Caught
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Usually, credit card fraud happens when an unauthorized person gains access to a person’s credit card information and uses the information to make purchases, transfer the funds, etc.    

Types of Credit Card Fraud

There are two types of credit card fraud available. They are –

  • In-person Fraud: It is also known as card-present fraud. This type of fraud happens when someone steals your card, and then uses the information to create a counterfeit card and do unauthorized transactions.   
  • Remote Fraud: This type of fraudulent activity is also known as card-not-present fraud. This is a different type of situation where the fraudster only uses the card i9nformation to do online shopping. Here, the fraudster doesn’t use the credit card physically.

When you file a complaint about credit card fraud to the credit card issuing company, the authority first makes sure that it’s a case of credit card fraud rather than a simple mistake. For example, if the merchant mistakenly overcharges you or doesn’t send you the product after making a payment then this is not a credit card fraud.

However, if you really become a victim of credit card fraud then the credit card issuing company will take proper steps and the Federal Fair Credit Billing Act (FCBA) will limit your liability to no more than $50 for unauthorized charges. Other card issuing companies like American Express, Discover, VISA, etc. will limit your liability down to $0.

How Often Do Credit Card Frauds Get Caught?

It is very unfortunate to say that, credit card frauds don’t get caught very often. But, the scenario changed once the financial institutes started to use EMV-chip on their credit card. Now it’s become very difficult to commit credit card theft thanks to the latest security measures. One key reason credit card frauds don’t get caught is, that they use anonymous services and modern techniques.

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Another important reason is, in most cases the victims don’t bother to inform the police or don’t file a complaint. Moreover, if the stolen amount is very small, then many banks don’t file a police report because of the insurance coverage. But, that being said; even if the amount is large, the only way the police can identify and catch a credit card fraud is if there is any relevant CCTV footage, or if the police can trace the scammer.

Detail Process of Catching a Credit Card Fraud

When you notice an unauthorized transaction, it is your duty to inform the card-issuing company about the fraudulent transaction. Then the financial institution will verify the transaction to make sure it is really a fraudulent transaction. Then they will block the card to prevent further fraudulent activity. After that, the authority will inform the police and file an official complaint. Then the police will start a fraud investigation and try to collect evidence like merchant’s information, timestamps, IP addresses, location, etc.

They will also check the CCTV footage and try to identify the in-person fraud. After that, the investigation team will file a police report to do further analysis and investigation. If this is an in-person fraud then you can be hopeful that the authority will be able to catch the fraud. However, if it is a remote fraud then the chance of catching the fraud is very low.

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How to Avoid Credit Card Fraud?

There are many ways you can easily avoid credit card fraud. Below are some proven tips that will help you protect your credit card from fraudulent activity –

  • Maintain proper security for the bag where you put your credit card
  • Don’t use any public WiFi connection while making a payment with the credit card
  • Always check your credit card statement and see if there is any suspicious activity
  • Always keep records of all your credit card information including the card-issuing company
  • Don’t unnecessarily carry your credit card with you
  • Make sure you don’t share your social security number with anyone
  • While making online payments with your credit card, make sure you avoid all types of shady and low-trust websites that don’t use HTTPS protocol
  • If you receive any unsolicited email with fishy/spammy links then you should cautiously handle those mails
  • Don’t share your credit card’s PIN or CVC with anyone
  • Always check the devices at gas stations or ATMs before inserting your credit card

FAQs about How Credit Card Frauds are Caught?

Who is liable for credit card fraud?

With the recent introduction of the Fair Credit Billing Act, now consumers in the USA are only liable for no more than $50 in fraudulent charges. This amount is fixed and regardless of the total fraudulent amount the credit card holder is only liable for $50.

Does the FBI investigate credit card fraud?

The answer to this question depends on who the victim is, the amount of the money, and how big the scenario is. If it is a VIP case or a matter of national security then the FBI wills involve in the investigation. Moreover, if the police or the investigation team seeks help from the FBI, then the FBI might get involved.

How much credit card fraud is there in 2022?

In America, credit card fraud and identity theft is very common criminal activity. In 2022, there are more than 327,1824 cases of identity theft and among them, more than 39 percent were credit card fraud.

How much money is stolen every year via credit card fraud?

According to the Federal Trade Commission (FTC), every year in the USA, more than $4.5 Billion is stolen via credit card fraud.

What Fraud Protection Features Do Credit Cards Provide?

Thanks to advanced technology, nowadays merchants, banks, and other financial institutes offer various security protections to their credit and debit cards. They offer a variety of measures to stop fraud from happening that includes –

  • EMV chips
  • Contactless cards
  • Virtual card numbers
  • Card lock            

How much jail time do you get for credit card fraud?

In most USA states, credit card fraud is considered a third-degree felony, so the punishment could range from 2 to 10 years in prison and fines up to $10,000!

What is the most common type of identity theft?

Among other types of identity theft, credit card fraud is the most common one. In this type of situation, a fraud collects important information about the credit card and then uses the information to transfer the funds or use the information to make online transactions.

Which state has the highest number of identity theft cases?

Among all the states in the USA, California has the highest number of identity thefts. This information is based on a 2022 Federal Trade Commission report.


Last Updated on August 7, 2022 by Ana S. Sutterfield

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