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4 ways to watch for credit card fraud

by Barbara Marquand

While the ability to detect and stop identity theft is speeding up, according to Javelin Strategy & Research, more than 8.1 million adults were victims in 2010. And although this is three million fewer victims than the prior year, the consumer out-of-pocket costs rose significantly.

Eight million is still quite a large number. Here are four things you can do to try to stay out of that statistic.

1. Monitor Credit Card Use Online

Don't wait for the monthly statement to arrive by mail. Sign up with your credit card companies to monitor your accounts online. Checking your account activity frequently enables you to spot unauthorized charges quickly and keep tabs on your spending.

2. Save Credit Card Receipts

You can probably remember all your purchases when you see them on your credit card statement, but how do you know that the amounts are correct? Unless you have saved your receipts, you won't be able to detect when you've been overcharged. You'll have only a vague suspicion. Keep receipts in an envelope until you've checked them against the totals on your credit card accounts.

3. Sign up for Credit Card Transaction Alerts

Credit card companies offer free transaction alert services, which send you messages by e-mail or cell phone text if there is unusual activity on your account. You set the parameters to trigger the alerts, such as purchases that exceed a certain dollar amount or originate out of the country. The alerts give you almost immediate heads-up notice that something might be awry.

4. Review Your Credit Reports

You're entitled under federal law to receive free copies of your credit reports annually from each of the three major U.S. credit reporting bureaus -- Experian, Equifax, and TransUnion. Requesting reports is easy. Just go to AnnualCreditReport.com and follow the online instructions. Check the reports for accuracy and to make sure no one has opened fraudulent accounts in your name. Contact the credit reporting bureaus and the financial institutions if you find mistakes or think you've been a victim of fraud.

Call your credit card companies immediately if your credit cards are stolen or lost or you think someone has used your credit cards without your permission. You are liable under federal law to no more than $50 for unauthorized purchases, and many credit cards have zero-liability policies.

Published 11/08/12 (Modified 11/21/13)

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