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How to avoid being a victim of credit frauds/scams?

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Aug 28, 2024

How to avoid being a victim of credit frauds/scams?

This article is contributed by Credit Bureau Singapore.

It is no stranger to seeing news on frauds and scam these days. Due to the high utilisation rate and reliance on digital technology to source for information or even going about our day-to-day life, it is no stranger to see news on new victims falling for frauds and scams every day. In fact, credit fraud has become such a prevalent issue that it affects not only on the individual levels now. Fraudulent organisations are now enhancing their tactics to target big institutions such as banks, bringing up their scam games to a whole new level. This fraud occurs when there is unlawful use of another person’s credit information to make purchases, withdraw funds or commit other financial crimes. As technology advances, so do the tactics of fraudsters, it is important to understand the mechanisms of credit fraud and how you can use such knowledge to protect yourself and the people around you.

Credit fraud can take place in many forms including:

Identity theft: fraudsters use personal information such as your name, date of birth and national identity numbers to apply for credit in someone else’s name.
Online transaction fraud: fraudsters can use stolen personal credit card information through data breaches or hacking of systems to make illegal transactions and unauthorised purchases.
Account takeover: fraudsters can gain access into your personal bank account to make unsuspecting unauthorised transactions or cash transfers and by the time you are aware, the damage has already been done.

How You Can Protect Yourself from Credit Fraud

Check Your Financial Accounts; when paying your bills, make it a habit to go through every single statement and look out for any suspicious transactions that was not done by you. Setting up bank transaction notifications can also help you to detect authorised activities quickly before more damage is done.
Limit sharing your personal details; it is important to know that sensitive personal information such as your bank account password, passport or identity documents should be kept securely and safely, away from possible of exposure to other people. Do not willingly share such personal information unless it is someone you can really trust.
Check your credit report regularly; your credit report is a comprehensive record of your credit repayment records compiled from various retail banks, merchant banks, finance companies and credit card issuers in Singapore. You can also consider subscribing to My Credit Monitor (MCM) to receive timely updates via SMS or email on your latest status of your credit file.
Stay cautious online; avoid browsing on websites that is not secure or suspicious. Ensure that you do not auto-save your personal bank account details when making online transaction. Always make online transactions from legitimate or official sites and use a credit card over debit card when making big ticket purchase items. Credit Card generally have stronger fraud protection measures and if unauthorized charges are made, it allows you to raise dispute with the bank. For debit cards, it can be more challenging to recover lost funds.
If something is too good to be true, it is likely to be a scam. Scammers lure victims by promising extraordinary benefits such as guaranteed returns with simple few steps of instructions. If you suspect something is not right, be on high alert and do plenty of research from trusted source before making any commitment.

The consequences of credit fraud can be severe and can result in financial losses, damaged credit score and a length process in resolving disputes and restoring financial identity. There is no 100% fool proof method to stay free from potential scams and frauds. However, by staying informed about the latest scam and fraud tactics and taking personal measures to safeguard your personal information, you will be a step ahead of scammers and prevent yourself from falling victim into such fraudulent schemes.

Lastly, follow and like CBS Facebook and Linkedin page for more useful financial content and tips to maintain a good credit score or visit the CBS’ website to get a copy of your credit report.