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How Is Credit Card Fraud Investigated

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Penalties For Credit Card Fraud In Canada

Two wanted in credit and debit card fraud investigation

As a criminal offence, the penalties for credit card fraud are set forth by the Criminal Code of Canada. Matters are assessed on an individual basis, though there are some standards in place which are used as guidelines. These include:

  • Fines: If an individual possesses a forged or stolen credit card there is the potential for a $5,000 fine. While fines are a possible legal recourse, it is not the only option. Therefore, the fine will not necessarily apply.
  • Imprisonment: A jail sentence of six months may be placed instead of the above-noted fine. In certain situations, both the fine and the minimum jail sentence is ordered. For a more severe offence, and if it is classed as an indictable felony, a maximum of ten years jail time can result.

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How Do Banks Investigate Fraud

When the cardholder is claiming that the merchant defrauded them in some way, the bank may request more information. Merchants should always be on the lookout for these inquiries. Any inquiry that can be adequately addressed is a chargeback prevented.

Ideally, bank investigators should uncover friendly fraud when it occurs, since they’re trained to identify common scenarios such as a free trial period ending, in-app purchases made by an unsupervised child, and so on. As merchants know, this doesnt always happen. Friendly fraud chargebacks are a huge problem for merchants, who have to take it upon themselves to provide evidence that refutes these claims.

If they’re confident that fraud has occurred and feel the case is substantial enough to warrant it, the bank may notify law enforcement agencies such as the FBI. Of course, the decision on whether or not to open an investigation is up to the law enforcement agency involved.

Protecting Yourself From Credit Card Fraud

The growing prevalence of credit card fraud means there’s no surefire way to avoid becoming a victim, but common-sense precautions can help you avoid it:

  • Guard your wallet or purse carefully when you’re out and about, and don’t leave credit cards unattended.
  • Keep credit cards you don’t use in a safe place at home, instead of carrying them with you, and never carry your Social Security card unless you must , and put it back in safekeeping when you’re done using it.
  • When shopping online, make sure the website is secure , and skip the option of storing your card number at the website.
  • If asked to provide a credit card number, Social Security number or other personal information over the phone, verify you are talking to a person or company you trust. If the request comes from someone who called you, ask yourself if the organization they claim to represent should already have the information they seek. If in doubt, insist on calling them back and use a verifiable number.
  • Take a look at the Experian Fraud FAQ and Fraud Alert Center for more information and tips on protecting yourself from credit card fraud. Experian will offer support by providing a free copy of your credit report, investigating disputed credit report information, and if fraud is verified, remove the information from your credit report.

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Learn How To Spot Credit Card Fraud And When To Take Action

Credit card fraud was the No. 1 type of identity fraud in 2019, according to the Federal Trade Commission . And the coronavirus is making matters worse. With many people stuck at home, the increase in online activityâincluding shoppingâhas given scammers even more chances to commit identity fraud.

The good news is that if this happens to you, thereâs a clear set of next steps for you to follow. And, if you report credit card fraud, you can usually reduce its financial and emotional impact.

Do The Police Investigate Credit Card Fraud

French criminals implanting stolen credit card chips into new forged ...
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Studies show that approximately 72% of Canadians have a minimum of one credit card. While there is a lot of value to these financial tools, ranging from repairing credit to accessing funds in an emergency, there are also distinct risks. Credit card fraud is an ongoing issue, facing a large number of households across the nation.

The presentation of this pervasive issue is diverse. Credit card fraud can result in stolen identity and severe financial issues for the consumer. For financial institutions, it serves as an extremely costly expense. According to a 2018 report issued by the Canadian Bankers Association, the price tag was roughly $862 million. With the continued prevalence of this crime, it is important for consumers to stay informed so that they can take responsible action.

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What Fraud Protection Features Do Credit Cards Provide

Preventing credit card fraud can help save merchants and credit card issuers money, build trust among cardholders and keep you from having to wait for a new card. In short, it’s a win-win for everyone.

Credit card issuers use a variety of measures to stop fraud from happening. These can range from physical features built into your card to complex artificial intelligence systems that detect and decline unusual transactions .

As a cardholder, you could look for a card or issuer that offers:

There are also credit card fraud prevention measures that could be taking place without you noticing.

For example, before a transaction gets approved, it may be assigned a risk score based on the time of day, transaction amount, card’s transaction history, the location of your mobile phone and other variables. The merchant can decide whether to approve or deny transactions depending on their risk scores. And online purchases may be scrutinized based on additional information, such as the purchaser’s IP address, email host, shipping address and order details.

How To Protect Yourself From Credit Card Fraud

Most credit cards today come with sophisticated security features, and you can also turn to free credit monitoring services as an easy way to keep an eye out.

The easiest actions you can take include opting for a card with $0 liability protection, monitoring your accounts closely, signing up for transaction alerts and securing your personal information.

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How To Use Donotpay To Learn About Police Investigations Of Credit Card Fraud

Credit card fraud investigation

DoNotPay was designed to level the playing field and make important information available to the masses. If you have been victimized by a credit card fraudster and you need some further information on the matter, just follow these easy steps on the DoNotPay identity theft product page.

DoNotPay can help you

  • File an official report with the FTC
  • Alert state agencies about unemployment insurance fraud
  • Alert the U.S. Department of Justice’s National Center for Disaster Fraud about unemployment insurance fraud
  • Contact the IRS about tax fraud
  • File a police report
  • Contact the credit bureaus to set up fraud alerts and freeze credit reports.
  • Getting the ball rolling with the local police

  • Search “identity theft” on DoNotPay and select the type of incident you would like to report.
  • Tell us more about the incident that occurred, including the location, date, time, financial loss, and any suspect information you may have.
  • We’ll identify whether you should file an FTC report, contact the IRS, freeze your credit report, contact state agencies, or file a police report. Once we guide you through the best options, we’ll automatically submit the reports on your behalf.
  • And that’s it. DoNotPay will make sure your issue gets sent to the right place. We’ll upload confirmation documents to your task for you to view, and if the contacts need more information, they will reach out to you personally via email or mail.

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    How Do Banks Handle Credit Card Fraud

    If youve ever opened your credit card statement only to ask yourself What’s this charge? you may have been the victim of credit card fraud or identity theft. That’s only one of many ways credit card fraud can occur. Unauthorized debit card charges, as well as unauthorized ATM withdrawals, can also indicate that fraud has occurred. Credit card fraud strikes individuals and businesses alike. After a customer notifies the bank that issued the card of an unauthorized charge or withdrawal, the bank will conduct its own credit card fraud investigation.

    Fraudsters Prefer To Open New Accounts

    Its important to safeguard your existing credit card accounts from being used by other people, but todays crooks find them less desirable than your personal information that can be used to open new credit cards. The 2020 Federal Trade Commission study discovered that 88% of credit card fraud in 2019 consisted of thieves opening new accounts.

    Remedy: When it comes to identity theft, the most valuable piece of information is your Social Security number. With it, thieves can open accounts in your name, so locking down that number is crucial.

    Youll want to make it as difficult as possible for criminals to steal your information. The Social Security Administration offers free cybersecurity protection to all consumers. When you enroll, it will add another layer of protection between you and cybercriminals.

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    Why Do I Need A Fraud Investigation

    If you are the victim of a scam, you may lose significant amounts of money and, in some cases, your good name. Proving a fraud actually occurred, however, can be complicated and evidence you gather on your own may not be admissible in court. A qualified, experienced investigator helps you receive the compensation you deserve.

    Tips To Prevent Credit Card Fraud

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    Remember these tips when using your credit card in public places or at places of business:

    • keep your credit card in a safe place
    • limit the number of credit cards you carry with you
    • cover the keypad with your hand or body when entering your PIN so no one can see it
    • keep your credit card in sight at all times when making a purchase
    • report anything you think is suspicious about a credit card device at a business or ATM to the businesss head office and your credit card issuer

    At home

    Protect yourself from credit card fraud at home by doing the following:

    • lock your mailbox if you can to prevent someone from stealing your credit card statements or replacement cards
    • sign the back of a new credit card immediately after you get it
    • destroy old credit cards that are no longer valid by cutting them up
    • keep your credit card statements in a safe place
    • shred credit card statements when you no longer need them


    When banking or shopping online, look for websites with addresses starting with https or ones that have a padlock image on the address bar. These are signs that your information will be secure.

    Protect yourself from credit card fraud online by also doing the following:

    Over the telephone

    Legitimate credit card companies dont ask for personal information over the phone. Use the telephone number found on the back of your card when you want to contact your credit card issuer.

    Protect yourself from credit card fraud when on the telephone by also doing the following:

    In general

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    Avoid Being A Fraud Victim

    Fortunately, the card networks have a zero liability policy that ensures that you will not be held responsible for fraudulent charges. And federal law limits your losses for unauthorized credit card use to $50. Various states have their own consumer protection laws that could offer you additional protections, too.

    Even though you are not responsible for unauthorized charges, it is best to avoid being a fraud victim in the first place. For one, the losses sustained by the card networks as a result of fraud are likely to be passed on to consumers in some form.

    Its best to be on your guard against fraud and also check your credit report regularly to make sure there is no activity you dont recognize.

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    What To Do If Youre A Victim Of Credit Card Fraud

    Contact your financial institution immediately if your credit card is lost or stolen. Contact it if you find payments on your credit card statement that you didnt make or approve.

    If you think youre a victim of credit card fraud:

    • write down what happened and how you first noticed the fraud
    • contact your credit card issuer to tell them about the fraud
    • take notes of who you talked to and when you spoke to them
    • keep all documents that you think might be helpful when the police investigate the fraud
    • contact your local police service to file a complaint
    • contact other accounts that could be tampered with by the person

    What Can You Do If You’re A Victim Of Credit Card Fraud

    Man wanted for credit card fraud investigation

    Even with all these safety measures in place, it’s best to be mindful of credit card fraud. If your card is lost or stolen, contact your credit card issuer right away so it can cancel your card and send you a replacement.

    You might need to take additional steps if your personal information is stolen or there are unauthorized charges on your account and you still have your card:

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    Review Of Disputed Transactions

    During its credit card investigation, the card issuer will then review all of the disputed transactions, looking closely at when and where they were made, and whether any of them required a signature. If so, the signature will be compared to the cardholders signature on file. Signatures that do not match make quick work of proving a transaction is fraudulent.

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    How Common Is Credit Card Fraud

    The Federal Trade Commission considers credit card fraud a form of identity theft. According to FTC data in early 2022, credit card fraud has consistently been the most commonly reported type of identity theft since 2017, save for a few months in 2020-21 during the COVID-19 pandemic, when there was a surge in fraudulent claims for unemployment benefits and other relief programs.

    FTC statistics reflect only fraud cases that were reported to the agency and most instances of fraud never actually get reported. They’re handled directly by the issuer. Data from the Federal Reserve gives a glimpse into the actual scope of credit card fraud.

    Based on data from the Federal Reserve and the Census Bureau an average of 9.5 million consumers a year experience an incident of credit card fraud.

    According to the most recent Survey of Consumer Payment Choice, conducted by the Federal Reserve Bank of Atlanta, 3.5% of credit card holders in 2020 said they had experienced an incident of loss, theft or fraud related to their credit card in the past 12 months.

    The survey also reported that 79% of consumers have at least one credit card.

    Meanwhile, a 2021 survey by researchers at found that more than half of respondents 58% had experienced credit card fraud at some point in their lifetime, with 9% saying they’d been victimized four or more times.

    In short, credit card fraud is not just something that “happens to someone else.”

    Credit Card Fraud Occurrences Have Risen 161%

    How to Detect &  Report Debit and Credit Card Fraud

    The Atlas VPN research paper includes other alarming statistics on fraud. Credit card fraud increased from 17,236 reports in the first quarter of 2015 to 45,120 reports in the same quarter of 2020. Thats an increase of 161.7%. Why? Its a lucrative business.

    Remedy: Thieves depend on being able to operate in the dark. The fewer people who know about fraud and protective measures, the more they can get away with their crimes.

    Thats why you need to become a mouthpiece for accurate information. Share what youve learned about how to protect your credit cards and identity with your family members, friends, and colleagues.

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    Reporting Credit Card Fraud

    If you have been a victim of credit card fraud, you do have certain legal rights. The Fair Credit Billing Act allows you to dispute errors on your credit card statement.

    To take recourse to this law, you should send in a dispute statement to your credit card companys address for billing inquiries, not the address to which you send your card payments.

    You should send this dispute letter within 60 days of when you first got the card statement with the fraudulent charges. It would be best to send this by certified mail with a return receipt so you have proof of delivery.

    The card issuer should acknowledge your letter within 30 days of receipt, and it should also resolve your issue within 90 days of getting it.

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