How Far Should You Go When Tracking Down The Source Of Credit Card Fraud?

If you've had your credit card information stolen, leaked, or "skimmed" over the past few years, you're already well aware of the hassle and expense that can come from trying to reverse any fraudulent charges and replace your card. Even more frustrating is the inability to pinpoint where your card was compromised--and therefore, how you can prevent a future such incident. Read on to learn more about some of the most common types of credit card fraud, as well as how far you can (or should) go when trying to determine the origin of your credit card leak.

What types of credit card fraud are the most common?

Credit card breach incidents are usually grouped into a few main categories. About 55 percent of all breaches are caused by a "malicious outsider"--these breaches can include the large-scale data breaches suffered by a number of the country's largest retailers and service providers. Credit card skimmers, or devices placed over credit card scanners to capture the secure card information, can also fall into this category. 

Another 25 percent or so of credit card breaches are caused by accidental loss. While many Good Samaritans may turn in a wallet they find, not all are so honest, and a lost wallet (or misplaced credit card) can be the source of a shopping spree for an unscrupulous thief. 

The remaining 20 percent or so of credit card thefts occur through state-sponsored hacking attempts, malicious insiders, and even "hacktivists" who attempt to pinpoint security issues by showing system users how easy it is to obtain credit card information. 

What can you do to identify the source of credit card fraud? 

One important first step in protecting your credit card information going forward is simply to narrow down the potential sources of fraud. Unfortunately, unless you remember recently using your credit card at a shady-seeming gas station or were aware you lost your wallet the day before you began noticing fraudulent charges, you may not have any idea where to begin. 

Indeed, the most "successful" credit card thieves don't start using cards as soon as they acquire the confidential information; instead, they'll wait a few weeks, months, or even years to ensure any suspicion you may have had about the safety of your card has long since been assuaged. When trying to remember whether your card has been in any compromising situations, you'll want to look back more than a few days or weeks to ensure you're not inadvertently overlooking something that may help you crack the case. 

Advances in digital forensics have made it far more possible for computer experts to track down the origins of a stolen or breached credit card; however, embarking on a forensic investigation for every data breach can be cost-prohibitive, so most credit card companies and lenders simply cancel the stolen card, issue a new one, and write off any fraudulent charges rather than attempting to identify or seek prosecution of the responsible party. 

The sheer volume of credit card breaches that occur on a daily basis means that very few fraudsters are caught or prosecuted--and most who do face consequences for these crimes have stolen thousands or even tens of thousands of credit card numbers rather than just a handful. 

However, this doesn't mean you can't launch your own forensic investigation. While doing so may often require you to invest some additional time and money by hiring a forensic investigator, in some cases it can be well worth it to determine whether your credit card was breached by someone close to you (like a housekeeper or babysitter) or leaked through a more anonymous online transaction. You may also want to seek a digital forensic investigator if you're worried you'll be stuck with fraudulent charges after facing pushback from your credit card company or bank.