Beware of this New EMV Chip Credit Card Scam

Credit card scams are recurrent news items. This time round, the scam relates to the new Europay, MasterCard and Visa (EMV) chip-enabled cards.

The transition from the traditional cards to EMV-enabled chips has given crooks a sporting chance. Even the FBI is advising card holders to beware of fraud. New microchip-enabled cards are replacing traditional magnetic strip cards this month to make it more difficult for hackers, but the FBI doesn’t want users to let their guard down.

October 1st was the deadline for retailers and credit card issuing companies to switch over to the new EMV credit cards. These cards contain a computer chip. Unlike magnetic-stripe cards, every time an EMV card is used, the card chip creates a unique transaction code that cannot be reused. EMV technology will not prevent data breaches, but it will make it much harder for criminals to profit from what they steal.

The card issuers or retailers who do not comply with the new law become liable if their customers suffer from card-related fraud. For customers, the liability does not change from the legally mandated limit of $50, which is generally not even assessed against consumer victims of credit card fraud.

How does the scam work?

The shift from the old cards to the new EMV cards requires the installation and activation of new credit card equipment at stores. This is a daunting task that also involves the re-issuance of more than a billion credit cards. Stores like Target, WalMart, Walgreens and Costco have been proactive and have started the use of new card processing equipment; but many others are still finding their way. As per a survey, approximately 40% of Americans have received the new cards as of now. The remaining are still waiting to receive them.

Scammers are taking advantage of this situation. They are contacting credit card holders and asking them to share their personal information in order to issue EMV cards. Also, they will ask cardholders to click on a link sent via email to complete the process. As soon as victims click the link, they end up downloading keystroke logging malware that steals all of personal information entered on the computer.

Another scam directs card holders to a website that looks like a page from the credit card company. This cons the victims into revealing sensitive information like SSN or credit card details to the fraudsters.

Identifying fraudulent e-mails

Generally the credit card issuer has all of your details and they don’t need any additional personal, confidential information to issue a new EMV card to you.

Merely the presence of a credit card company’s logo does not make an e-mail legitimate. Stealing a logo from the Internet is as easy as cutting and pasting. The first thing you should check is the email address of the sender – not just the address you in your inbox. When you press reply (not don’t send!) you’ll see the true address to which the email will be sent. If it is from someone totally unrelated to your credit card company, then it’s a scam.

If your email is addressed to a generic salutation, such as “Dear Cardholder,” instead of your name, it’s most likely a scam. If any of the wording seems stilted or the punctuation is not 100% correct, it’s almost certainly a scam. A genuine e-mail will have the last four digits of your card number as reference. When in doubt, consider calling the toll free number at the back of your credit card to confirm.

If you get a call or email from someone saying they want you to reconfirm your account information – delete the email, don’t click on the link and hang up the phone.

If you think you may already be a victim of this scam, contact your credit card company. Also, pay even closer attention to your bank statements and your credit reports. Look for strange new accounts that you didn’t open. That could be a sign that your identity has been stolen.