Skip to toolbar

Cash back scam and how do we need to prevent them?

All the time, the techniques used to tackle credit card fraud or cash back scam are becoming more complex. Sadly, certain tactics used by credit card scammers and cash back scam are evident.

The number of identity theft cases in 2019 is on the rise due to the rise in e-commerce transactions. Credit card-related fraud or cash back scam accounted for a substantial percentage of identity theft data. Such are just the instances that were identified by concerned governmental agencies.

The phone and internet fraudsters will still be lurking, wanting to take advantage of customers. Knowing what common scams are prevalent and how to avoid falling for them will keep your money and identity secure. Here are six credit card scams or cash back scam that you should look out for.

1. Cash back scam as Charity scams.

These credit card scams or cash back scam prey on people’s good intention to lend support.

After a natural catastrophe like a hurricane, flood or wildfire, scammers emerge, calling or emailing and appealing to people to assist victims with a donation. They claim to be from various respectable organizations including Red Cross and Salvation Army.

When a “charity worker” calls with a lengthy account of circumstance that he or she is in, we might find it difficult to say no. Requests for funding are constantly viewed as urgent in order to acquire the credit card numbers rapidly and readily.

How to avoid the Charity Scam

If you’re willing to donate money to aid after a tragedy, by contacting a charity yourself, it’s best to do it proactively. Through using the IRS’ tax-exempt organization search or a resource like Charity Navigator, you can verify if a charity is valid.

If anyone calls you requesting a donation, even if it seems genuine, don’t include your credit card details. Write down any data they supply you with, then hang up politely. Check for the phone number on the web and put quotation marks in your search around the number. You’ll also find that the number that you called was already known as a scam caller. If the charity is legitimate and you want to help, donate via its website directly.

2. The scam from the hotspot also comes under cash back scam

When using a public Wi-Fi network, it’s standard advice to be vigilant, because crooks could be monitoring these networks. But the network itself is often a trap, deliberately laid down by credit card scammers who are waiting to pounce on your results.

Your smartphone or laptop discovers a “public Wi-Fi hotspot,” in this credit card scam/cash back scam, and when you connect to it, you are asked for credit card details to pay for internet access. The hotspot is fake, and you’re actually directly giving the scammers your credit card details. The hotspot is free in some situations, and provides internet access, but the scammers watch your every move. When you search it, they record passwords that you enter, peer into your bank account and collect your data in other ways.

How to stop the scam HotSpot

Ask an employee for the correct network name and password information if you need to use public Wi-Fi at a restaurant or shop. Be cautious of generic-sounding names like “Free Public Wi-Fi.” If you can, avoid logging into your bank account or providing any confidential details.

Utilizing a VPN or virtual private network is another way to secure yourself. And on unsecured public networks, this provides a secure link that you can use.

» MORE: 4 simple tips to protect yourself from cybersecurity risks

3. The ‘sign-up farm’ credit card scam

Victims of this credit card scam or cash back scam are always eager victims, duped by the promise of easy money to help deliver legitimate credit card rewards for what they are told. In fact, ripping off card issuers, sometimes on a large scale, is a scam. In May, New Jersey federal prosecutors charged two men with operating an intricate “sign-up farm” that cost more than $8 million for American Express.

People running these scams recruit individuals with good credit and offer to pay them to open credit card accounts using their Social Security numbers. In order to generate rewards points, the scammers rack up big balances on the cards, convert the points to cash, then cancel the transactions. They don’t even try to cancel, in some situations, and the victim is left on the hook.

Usually, victims are promised compensation of $1,000 to $10,000 for the use of their data, although some never get paid. They’re normally told that card spending will be legal, even though it’s all about defrauding the issuer. Victims will end up responsible for huge balances, have their credit impaired and will lose credit cards.

How to stop the Farm Scam Sign-up

It can be difficult for anyone to avoid the appeal of easy money, and even more so for those who are struggling financially. But to conclude that there is no easy money is wise.

The easiest way to avoid frauds is to never give someone else your Social Security number or other information. To ensure no one accesses your accounts without your permission, check your credit report for any irregularities.

4. The scam on interest rates is one of the dangerous cash back scam

This classic robocall scam is familiar to millions of individuals. You answer a telephone call, sometimes from an anonymous number, and a recorded message brings you the wonderful news that your credit card balances are eligible to negotiate substantially lower interest rates. The letter has inside links to credit card firms, which can save you thousands of dollars on fees. There are no such links-the whole thing is a setup to get you to disclose details about your credit card.

You’ll be taken to a live operator if your curiosity is piqued enough to continue listening. In order to collect your personal data and credit card information, the’ helpful’ representative will quickly ask you sensitive questions.

The caller calls the credit card company in a much more legal, but still expensive, version of this scheme and successfully reduces the fee, and you get hundreds or thousands of dollars paid for the service. The problem is that they don’t do something you can’t do for free on your own. When it comes to minimizing the interest rate, you have just as much clout with the credit card provider as a third party. You may be given an option by your issuer to move your balance to another card that offers a lower APR.

If you’re trying to reduce the interest rate on your credit card purchases, you can have it done for free. Call the customer service phone number on the back of your credit card and ask for a reduced rate.

How to stop the Scam Interest Rate

Contact the lender directly if you want to lower your credit card interest rate. And if they say no, it won’t hurt you to inquire.

Only disregard robocalls that pledge to cut rates or any other bid that seems too good to be true. Never send out classified details or confirm it to someone who calls out of the blue. Place your phone number on the National Do Not Call List to decrease sales calls, then bear in mind that legitimate companies stick to the registry while scammers don’t.

» MORE: How to prevent identity theft

5. The Scam Overcharge is another way of cash back scam

As fewer purchases are done in cash and more shopping moves online, this credit card scam/cash back scam is gaining ground. You get a call or text telling you that a recent purchase overcharged your credit card. How supportive! The issue is that it’s not real. In order to get your personal information, the scammer will ask a lot of questions.

This scam is particularly convincing, according to the Better Business Bureau, since the scammers will also address the target by name. The ambiguous “recent purchase” angle becomes more compelling with more and more small, daily transactions being placed on credit cards.

How to stop the Scam Overcharge

Don’t use the phone to have confidential personal information. Uh, hang up. Check your statement on your credit card. Ask the credit card provider yourself, call them directly, rather than asking questions on a website.

6. The skimming scam

The widespread adoption of EMV chip technology was hoped to wipe skimming out, but it has proven persistent. In fact, the latest data from the FICO credit scoring company showed that in 2017, the number of payment cards compromised at merchant card readers and ATMs increased by 10 percent.

A skimmer is placed on a gas pump, ATM or anywhere by crooks on a card reader. When you tap or insert the card, the skimmer reads the details from the magnetic stripe on your credit or debit card. They can be difficult to detect, and with the naked eye, some of the newer ones are all but impossible to see.

During the high season, skimmers are particularly popular in tourist-heavy areas. It’s critical that people are aware of exactly what to look out for because each skimmer can defraud consumers up to a million dollars. It is critical that people know exactly what to look for because up to a million dollars can be defrauded by any skimmer.

How to avoid the skim scam

While skimmers are always well-concealed, you may complain that something looks off occasionally. Look for signs of hacking like devices attached to or beside the card slot. To stop using your physical passport, move toward using a mobile wallet and contactless payments.

Check the balances of your account and transactions regularly. If you see anything amiss, immediately contact your credit card issuer to report the fraud.

» MORE: How to spot and report fraudulent credit card purchases

We will be happy to hear your thoughts

Leave a reply