How Credit Card Companies Detect Fraud
Find out how Credit Cards are able to detect fraud instantaneously
Credit card companies are tracking your every move; by using your credit card for every purchase, these companies can see what you bought, where the transaction was made, what time it occurred, and how much it cost. With this massive amount of data, they are able to look for any suspicious pattern. If a series of events seems off, they can close your credit card until they can contact you to confirm the purchases.
Examples of suspicous patterns
Credit card companies are able to train their computers into noticing any unusual activity.
- A purchase is made thousands of miles away from your usual area (remember to call your credit card companies before traveling overseas for vacation!).
- A transaction occurs in an area of high credit card fraud. Credit card companies can construct a heatmap of where fraud is most frequent. The area of transaction gets weighed into whether this is a fraud or not.
- A large transaction occurs right after a smaller one. This is usually a thief checking to see that the card works before making a larger purchase.
- Type of purchase with regard to gender, typical monthly charge.
- Frequency of purchase compared to the norm.
Why do Credit Card Companies invest so much in catching fraud?
Nowadays, credit card companies offer you protection so that you aren't wrongfully charged if your credit card information is stolen and abused. If you ever see a suspicious charge on your statement that clearly wasn't from you, you can request to have it removed and the amount credited back. Thus, the main reason that credit card companies are so invested in detecting credit card fraud is to protect themselves of wrongful charges.
Must-Reads for Financial Success
The Total Money Makeover
Okay, folks, do you want to turn those fat and flabby expenses into a well-toned budget? Do you want to transform your sad and skinny little bank account into a bulked-up cash machine? Then get with the program, people. There’s one sure way to whip your finances into shape, and that’s with The Total Money Makeover: Classic Edition.
$ Check price
(3,555+ reviews) Aching back from coding all day?
Prism Glasses
Ever feel achy from sitting crunched up on your computer table? Try lying down with these optical glasses that allow you to work on your laptop while lying flat on your back. This is the perfect solution with those with limited mobility or those who wish to prevent neck cramps and back strains.
$ Check price
(128+ reviews) Ad