Credit Cards: Chip and PIN and the Internet
Chip and PIN is now regarded as a very safe way of paying for goods and services by credit card. The use of Chip and PIN has eliminated credit card fraud in the UK by up to 80%.
Chip and PIN technology works like this: Previously when you paid by credit card you signed a receipt. Fraudsters could obtain your credit card details by a process known as “skimming”, which is they would run your credit card through a credit card machine that copied all the details of your credit card. They would then produce a clone of your credit card and forge your signature.
With the introduction of Chip and PIN instead of signing a receipt when you pay, by credit card for goods or services, you key a four digit number into a keypad. This makes it much more difficult for the fraudster as although they can still “skim” your credit card they don’t know your PIN. That is why it is so important never to reveal your PIN to anyone or to write it down and keep it with your credit card. If you do and it can be proven that due to your negligence theft occurred against your credit card you will be liable for all losses. The credit card issuer will not reimburse you for your losses as would normally be the case. Also beware when keying your PIN into a keypad, when using your credit card at an ATM, as fraudsters have been known to take steps such as to place mini cameras to record your PIN. Never let your credit card out of your sight at outlets where your credit card is taken away from you and can be skimmed. A lot of outlets now ask you to insert your credit card into the credit card machine.
With the widespread use of Chip and PIN credit card fraud is no longer that easy and the fraudsters are now turning their attention to credit card fraud on the Internet.
The use of the internet for online shopping is growing at a tremendous rate and the fraudsters are keen to cash in. The chief advantage to the fraudster is that when purchasing on the internet they are only required to provide credit card details which they can obtain by “skimming” but not a PIN as these are credit card-not-seen transactions.
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