The never-ending reports of breaches and hacks prove that your sensitive financial and personal data isn’t necessarily safe, particularly when it comes to credit cards. One of the largest data breaches involved Capital One. The credit card company reported that personal information of 106 million of its customers had been compromised in July 2019.

Data breaches have become increasingly common, and you need to know how to protect yourself. Since hackers are going after the companies that hold your information, it’s hard to stop them from getting it. All the same, there are a number of ways to minimize the damage and protect yourself from credit card hacks and breaches.

Key Takeaways

  • Data breaches that compromise your credit card information are becoming commonplace. 
  • Well-known breaches that exposed customer data include the 2019 hacking of Capital One. 
  • If you’re the victim of a breach, then protect your credit record by immediately ordering a replacement card and freezing your credit report.
  • There’s no need to sign up for high-priced fraud protection.
  • To prevent potential breaches, be on the lookout for phishing schemes and use tough-to-crack passwords. 

7 Ways to Deal with Credit Card Hacks

Why do cyber thieves take the time to wreak havoc in such large proportions? Because it pays. On the black market, your credit card information is worth anywhere from $5 to more than $100, according to credit reporting agency Experian.

Other credit card breaches in the last several years include fast-food restaurant Wendy’s, which was hit by a breach in 2016 that leaked customer payment information at more than 1,000 different locations. The Home Depot data breach in 2014 affected some 56 million credit and debit cards. The well-known Target breach from 2013 affected about 40 million consumers.

Even if you haven’t yet been hacked, many of the seven moves described below can make your information less easy to find and less usable if you are caught up in a breach. They range from monitoring your accounts regularly to freezing your credit.

1. Get a Replacement Card

If you’ve been told that you’re part of a data breach, tell the company that you need a new card immediately. You’re not likely to get any pushback from the already-embarrassed company. But if you do, don’t back down.

2. Check Your Account Online

Don’t wait for your statement to arrive before you check it—monitor your account regularly online. Keep checking daily for at least 30 days, even after you get a new card. If you find a suspicious charge, dispute it immediately.

3. Freeze Your Credit

If you are caught up in a data breach, call each of the three main credit bureaus (Equifax, Experian, and TransUnion) and request that your credit report be frozen. Freezing means that no one will be able to access your credit report without your approval. Creditors likely won’t approve an application without having access to your credit report.

If you’re deeply worried about potential breaches, then you can also put a credit freeze on your accounts proactively—you don’t have to be a fraud victim. However, this step makes getting any kind of credit very cumbersome for you and for the potential lender, so you may want to think twice about taking it.

4. Place a Fraud Alert

An alternative—and less drastic—step to freezing your credit is to place a fraud alert on your credit profile with the credit bureaus. A fraud alert can protect your credit history from unauthorized access for one year, after which it can be renewed. A fraud alert won’t completely lock down your credit reports the way that a credit freeze does, but it does require creditors and lenders to take the extra step of verifying your identity before authorizing new lines of credit in your name.

There’s no need to sign up for high-priced fraud protection. In the panic of the moment, you might be tempted to shell out hundreds of dollars per year for credit monitoring services. Don’t do it. You can monitor your own accounts by closely reviewing the information that you get free of charge.

5. Order Your Credit Reports

By law, you get one free credit report per year from each credit reporting company, but you’ll probably be eligible for more frequent free reports if you were already a victim of fraud. Even if you haven’t yet been targeted, be proactive and take a look at your free reports. Ideally, you can order one every four months by staggering the requests across the three main credit reporting agencies, so you can be better covered across the entire year.

6. Watch for Phishing Scams

Just because thieves have your credit card number doesn’t mean they also have its expiration date and the three- or four-digit card verification value (CVV) number. Beware of phishing, a scam where the thief might send an email or call in an attempt to obtain the rest of the information. 

Don’t give your information to anybody unless you call the company directly. If somebody leaves a message, go to the company’s website and find a contact number to make sure it matches what the person in the message provided. For even more security, call the company directly and make sure that the person who called you is legitimate.

7. Be Smart About Passwords

Simply employing all the password rules won’t prevent a breach, but since you don’t know exactly what information thieves are looking for, it can’t hurt. Use strong passwords (random letters and numbers), and change them frequently. Remember, if it’s easy for you to remember, then it’s probably easy for a savvy cyber thief to crack.

You may also want to take advantage of additional digital security measures such as two-factor authentication, which delivers a special one-time code to a trusted device, such as a mobile phone. This provides a secondary layer of protection that requires physical possession of your device before allowing an unknown sign-in to your accounts. Newer types of authentication, such as Face ID and Touch ID on iPhones, are slowly replacing passwords as a legitimate means to grant a person access to sensitive financial information.

The Bottom Line

If you haven’t yet been a victim, act proactively to make yourself less vulnerable. If you have, don’t panic. It’s going to take time to clear up everything, but you won’t pay for any charges that weren’t yours. Call your credit card company, tell them about any incorrect charges, and be patient as they work to clear them from your account. In the meantime, continue monitoring your credit report and credit card bills for further signs of unauthorized activity.