Credit-Card Fraud on the Rise During the Pandemic
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What is the main topic discussed in this episode?
Here's your Money Briefing for Friday, May 29th. I'm J.R. Whalen for The Wall Street Journal. Keep your credit card information close. Since the start of the pandemic, there's been a big jump in credit card fraud.
You have these changes in spending happening.
Why did credit-card fraud spike during the pandemic in April?
And at the same time, it's moving. It's shifted much of the fraud to online purchases. And that's something that large card issuers have seen playing out where there's been a shift in recent weeks.
That's Wall Street Journal reporter Anna Maria Andriotis.
How did shifts in consumer spending move fraud from stores to online?
Coming up, she'll tell us the kinds of suspicious activity you should watch out for and how to protect yourself.
Banks are always kept busy trying to stop credit card fraud against their customers. But during the pandemic, the fraudsters have dialed up their efforts. Wall Street Journal reporter Anna Maria Andriotis is here to fill us in on what's happening. So, Anna Maria, why do you think credit card fraud increased so much in April over a year ago?
Fraudsters are trying to take advantage of the stress that both consumers and banks are under right now and are trying various ways to make fraudulent purchases, sometimes succeeding, sometimes not. And so in April, what we saw was that there was a 35% increase in the dollar volume of attempted fraudulent transactions on people's credit cards and debit cards.
But people aren't shopping in stores during the pandemic and spending is down overall. How has that changed the game for the bad guys?
This is an important point because card spending has changed dramatically since mid-March.
What tactics did fraudsters use in a phone-and-email scam example?
you're not going out, you're staying home, you're less inclined and really not needing to spend. Other households have pulled back because of unemployment and other financial issues. So there's been that change. You have these changes in spending happening, and at the same time, it's moving, it's shifted much of the fraud to online purchases. And that's something that large card issuers, including Wells Fargo, Bank of America, Synchrony Financial, which is the largest issuer of store credit cards that these issuers have seen playing out where there's been a shift in recent weeks.
Now tell me about the man you spoke with who thought he was getting a call from his bank.
A gentleman we spoke with in Cleveland, Ohio received a phone call in late April from somebody claiming to represent his bank.
How can you spot subtle signs that a banking message is a phishing attempt?
In this case, they were claiming to represent JPMorgan Chase, who the individual has his debit card with. So the caller knew pretty much everything he would need to know about this individual. He knew his full name. He knew his email address, the last four digits of his account number, and he told him that his debit card number had been stolen.
What immediate steps should you take if someone asks for a one‑time activation code?
It needed to be frozen. So he was essentially calling this customer, this debit card holder, to alert him to a problem, said he was from JP Morgan, knew many of his credentials, and ultimately told him, look, while we ship you a new card, You'll be able to continue making purchases if you link your card to a digital wallet. All you need to do is just read me the one-time activation code that you're going to get in your email, in your inbox. And sure enough, an email arrived. We saw the email and it looked fantastic.
How can daily monitoring and alerts help you catch fraudulent charges early?
pretty legitimate. You glance at it a couple of times, looks pretty well done. And so the one-time activation code came and the cardholder gave the person on the phone that number. And soon after hanging up, more than $300 in fraudulent purchases had been made in Florida. So this cardholder's in Cleveland, the purchases are made in Florida, and you really needed to look very closely at this email. I mean, the email that was sent to this cardholder even said something to the extent of, if you have any questions, please call the number on the back of your card. How much more legitimate could that sound? So here's an example where your fraudsters tapping into consumer anxiety about their finances, already having a lot of information on them.
I think this call might've gone differently If they said, what's your email address?
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Chapters
7 chapters
1
What is the main topic discussed in this episode?
0:05–0:19
2
Why did credit-card fraud spike during the pandemic in April?
0:19–0:36
3
How did shifts in consumer spending move fraud from stores to online?
0:36–1:48
4
What tactics did fraudsters use in a phone-and-email scam example?
1:48–2:38
5
How can you spot subtle signs that a banking message is a phishing attempt?
2:38–3:00
6
What immediate steps should you take if someone asks for a one‑time activation code?
3:00–3:34
7
How can daily monitoring and alerts help you catch fraudulent charges early?
3:34–7:14
Speakers
2 identifiedMore from WSJ Your Money Briefing
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