How to Avoid Identity Theft & Credit Card Fraud

How to Avoid Identity Theft & Credit Card Fraud

Identity theft and credit card fraud are widespread problems that affect millions of Americans every year. These crimes often go unnoticed until they become significant issues. In fact, you may not even realize you’re a victim until a debt collector contacts you. Additionally, fraudsters are constantly coming up with new tactics. To protect yourself, you should stay informed and take preventative action against credit card scams and identity theft. 


What is identity theft and credit card fraud?

Identity (ID) theft is a criminal act in which someone else uses your personal information without your permission. Identity thieves seek to obtain your sensitive data, including your name, social security number, birth date, and passwords. The information they collect allows them to engage in fraudulent activities under your name.

Credit card fraud is a type of identity theft that takes place when someone steals your credit card information. This stolen data can be used to access your credit accounts, and in the wrong hands, can lead to severe financial losses. Once they're in, thieves use your credit card numbers to run up charges and stick you with the bill.


Understand the damage from theft or fraud

If you notice any suspicious activity on your financial statements, it is important to take action immediately. Victims of ID theft or credit card fraud face varying degrees of difficulty in resolving the issue. While some can address the problem quickly, others may spend a lot of time and money to repair their reputation and credit score.

Victims with negative credit reports may face difficulty acquiring loans for education, housing, or cars. Additionally, it can lead to rejections of future job opportunities until the issue is cleared up. In rare cases, victims can be wrongfully arrested for crimes they did not commit. Here are just some examples of the actions that identity thieves can take:

  • Open a new bank account
  • Make unauthorized purchases
  • Take out a loan in your name
  • Rent an apartment
  • Sign up for utility services in your name
  • Change your credit card billing address so you don't see fraudulent charges on your statement
  • Get a driver's license or ID card with their photograph but with your name and address

Recognizing common types of fraud

Identity thieves are successful when people aren’t informed of their methods to obtain sensitive information. Unfortunately, you have to be prepared for theft and fraud tactics online and in-person. To help you stay informed, here are some strategies that are commonly used to deceive individuals into revealing personal data:


Phishing is a fraudulent practice that aims at obtaining personally identifiable information (PII) by posing as trustworthy sources like banks, websites, or potential employers. Fraudsters may ask you to confirm sensitive information like passwords or billing addresses through links that look legitimate but lead to fake websites. Clicking on links in emails or opening attachments may also install malware on your computer. This malware could collect personal information or send spam emails in your name.

Dumpster diving

Some identity thieves go through trash or recycling bins looking for your personal information. Your receipts, mail, and paperwork can easily end up in the trash. By throwing away unwanted documents, you run the risk of providing exactly what these thieves want to steal your identity– your name, address, credit card account details, and other sensitive data.

Stealing your belongings

When you're out and about in public areas, such as a coffee shop or subway station, it's important to keep your belongings in sight. Your backpack, purse, wallet or laptop are often where you store your credit cards, checks, passwords, and personal account information. As a result, they become prime targets for theft.

Shoulder surfing

Identity thieves commonly use a technique called shoulder surfing to steal confidential information, such as your PIN and passwords. This usually happens in public places where the fraudster can observe your actions by looking over your shoulder. Be mindful of your surroundings in public areas with free Wi-Fi. You should be extra cautious around ATMs and while you’re checking out in the grocery stores. 


Protect yourself by being proactive

While the goals of fraudsters rarely change, the strategies that they choose can evolve. To safeguard against credit card fraud and ID theft, it is important to recognize the signs of fraudulent activities. Here are some tips to protect yourself from scams:

Be wary of giving out your personal information

If you receive an unsolicited email or phone call requesting personal information, it's best to be cautious. The safest approach is to not respond to the message or provide any personal information over the phone. If you happen to open an unsolicited email, try not to click on any embedded links or open attachments. To confirm that a communication is legitimate, call the organization's customer service number or log into your account. If the communication is fraudulent, report it to the organization's fraud department.

Check your financial records vigilantly

When you receive your monthly statements and bills, make sure to review them promptly. Your credit card billing statement, checking account statement, and utility bills are some of the first financial records you should check. Keep your receipt from purchases to compare them to charges shown on statements. Report any discrepancies to the creditor immediately. You can also contact the creditor if a statement does not arrive on time.

Check your credit reports for unauthorized activity

Each of the three national credit bureaus are required to provide you with a free copy of your credit report. You can order your copies every 12 months by visiting or call toll-free (877) 322-8228. Upon receipt of your credit report, be sure to review it carefully. If you spot any inaccuracies, such as an unknown account or address change, notify the credit bureau right away.

Safeguard your information

Tear or shred any document containing personal information before you toss it in the trash. Cut up expired credit cards before throwing them out. Make sure your outgoing and incoming mail is safe from thieves. Keep tabs on backpacks, purses, wallets, and other items you may carry with you such as cell phones or laptops. If you keep written records of your account information, store it in a locked box or file drawer. You should also keep your passport and social security card in a safe place.

Keep your online transactions secure

When creating passwords, steer clear of predictable information. Passwords based on your birth date or digits from your phone number or address can be easily guessed. Ensure your computer has the latest virus and security protection. Refrain from saving personal details, passwords, or account numbers on your device. Be cautious when accessing sensitive sites while connected to public Wi-Fi, especially when logging into social media, checking bank accounts, or entering credit card information on shopping sites.

Keep track of your cards and ID

Keep an eye on your ID, credit card, or debit card during transactions, and be sure they are returned to you right away. Be wary of using convenience store ATMs, which may not be as secure as bank ATMs. When shopping online, consider using a credit card instead of a debit card. Lastly, sign your cards immediately upon receiving them, and never write your PIN on the back.


What to do when ID theft or fraud occurs

If you've been a victim of identity or credit card theft, don't panic. Most financial institutions have ways to identify fraudulent transactions. If suspicious activity is detected, your bank or credit card company will quickly notify you. They may also temporarily freeze your account to prevent further unauthorized charges. As soon as you notice anything suspicious, take action by reporting the incident. You can follow these steps to protect yourself from further harm:

1. Contact your bank or credit card issuer

If your credit card is lost, stolen, or subject to fraudulent use, contact the provider right away. Follow up with a written report. The company can prevent further misuse by canceling the card and issuing a new account and card. Prompt contact also ensures you won't be held liable for unauthorized charges exceeding $50.

To notify 1st Financial Bank USA about a lost card or cybersecurity issue, contact us, toll free, at 1-844-328-9330, Monday through Friday, 8:00 am - 8:00 pm (Central Time) and Saturday 8:00 am - 5:00 pm (Central Time) excluding Federal holidays.

2. Put a fraud alert on your credit report

Notify one of the three major credit agencies – Experian, TransUnion, or Equifax – and they will inform the other two. Review your credit reports carefully for any accounts or transactions that you did not initiate. If you notice anything suspicious, report it to the agency immediately. Setting up a fraud alert can also be helpful in preventing identity thieves from opening accounts in your name.

3. Close any affected accounts

After you contact your financial institution and credit bureau to notify them of the situation, you need to address the accounts that have been affected. Close any accounts that you suspect have been tampered with or fraudulently opened. The financial institution may assist you in disputing the fraudulent activity and recovering any lost funds.

4. File a police report

When you become a victim of ID theft, report the incident to your local law enforcement agency. Just remember to avoid calling 911. Instead, reach out to your local off-duty police number to report a financial crime. Make sure to obtain a copy of the police report, as it can be useful when dealing with creditors who may require proof of the crime.

5. File a complaint with the Federal Trade Commission (FTC)

If you file a complaint with the Federal Trade Commission, you'll be providing key information that can help officials locate and stop identity thieves. Not only that, but they may be able to offer additional assistance to you. Contact the FTC at (877) 438-4338, free of charge.

6. Secure your accounts

To improve your online security for the future, it's important to change the passwords for all your accounts, especially those connected to financial institutions. Additionally, make sure to use strong and unique passwords, and enable two-factor authentication for added protection. Finally, don't forget to regularly scan your devices for malware.

7. Stay vigilant

Even after you canceled any fraudulent accounts, you may still be at risk for further damage from identity theft. ID thieves might use your social security number to obtain a driver's license or apply for a job. For your financial well-being, monitor your bank statements and credit reports for suspicious activity for at least two years after the incident. Keep an eye out for any unusual signs of identity theft and stay vigilant.


It’s true that being cautious and watchful can help protect your personal information. However, there is no guaranteed way to prevent fraud from happening. If you fall victim, it is crucial that you act quickly. While we hope that you never have to face identity theft or credit card fraud, staying informed and alert can help minimize any potential damage.




💳Learn more card facts by reading What is the Difference Between Debit and Credit Cards? 

🛍️Are you ready to start using a credit card? Check out 5 Tips on How to Use a Credit Card Responsibly to learn more!