Do credit card chips prevent identity fraud?
YOUNGSTOWN, Ohio (WKBN) – These days, credit cards look a little different.
They now have a “smart chip” in them, designed to keep your information safe. But do they really work?
Mike Brent is the vice president of marketing at FiNet, a credit card processing center in Boardman, Ohio said chip cards take a little longer to use when checking out, but waiting those few extra minutes is worth it.
“The transaction does take a little bit longer, but that’s only really because the amount of data you’re transferring is substantially greater than what you were transferring with a magnetic strip,” he said.
Brent said whereas account information from traditional credit cards was stored in the retailer’s system, the chip encrypts personal information into what is called a token.
“Basically, a random series of letters and numbers that is then transmitted to the processor, and it’s decrypted from there. So there is at no point with the chip any of your information that is being displayed out in the open during the credit card process,” he said.
Every time you insert your chip into a card reader, a new token is created.
A chip won’t work, however, when you buy something online. There, Brent says, people can still be vulnerable to identity thieves.
The best thing you can do to prevent identity theft is to always check your bank and credit card statements. If you see something unusual, report it right away.
The Federal Trade Commission has created a website in which identity theft can be reported. Clues that someone may have stolen your identity include:
•You see withdrawals from your bank account that you can’t explain.
•You don’t get your bills or other mail.
•Merchants refuse your checks.
•Debt collectors call you about debts that aren’t yours.
•You find unfamiliar accounts or charges on your credit report.
•Medical providers bill you for services you didn’t use.
•Your health plan rejects your legitimate medical claim because the records show you’ve reached your benefits limit.
•A health plan won’t cover you because your medical records show a condition you don’t have.
•The IRS notifies you that more than one tax return was filed in your name, or that you have income from an employer you don’t work for.
•You get a notice that your information was compromised by a data breach at a company where you do business or have an account.
Go to www.identitytheft.gov for more information on addressing any issues.