Online credit card fraud is very common and causes a lot of headaches for consumers in retirement. So how can you avoid becoming a victim and make your retirement plans safe from this 21st century highway robbery?

In the case of online credit card fraud, not only does the consumer suffer, but the merchant suffers too.  The consumer has to get the charge reversed, whereas the merchant loses the cost of the product that was sold, they have to pay chargeback fees, and if it happens too frequently they face the possibility that their merchant account will be closed.

It is pretty safe to say that if you offer any type of goods or services on the Internet you are going to be a victim of fraud or of attempted fraud. 

There are two categories of credit card fraud that has a negative influence on both your bank balance and your retirement finances. These categories are organised fraud and opportunistic fraud. Organised fraud is actually a form of organised crime. Identity theft is the main method used here in order to apply for credit cards under the name of another person. Once the credit cards are issued, the thieves set up a drop location in which the goods are delivered so that they cannot be traced.

These criminals spend the card up to their limits and then when it is time for the bill to be paid there is no one to pay the bill.

The thing about these organised criminals is that they have to obtain a person's identity to begin with.  The Internet is a great place, especially when someone is conducting transactions over a website that is not secure. This is exposing financial information or personal information that can be used to obtain credit cards in your name.

You also don't want to keep personal information and account numbers on your computer because computers are always subject to hackers who can access any kind of information on your computer if they are able to get in. These criminals are always finding new ways to get your information and just as counter measures begin to show some sort of success, these criminals will find new ways to beat the system.

The second category of credit card fraud, opportunistic fraud, is when a criminal waits for the opportunity to commit fraud to present itself. This can be when a waiter or waitress who is in dire need of money copies down credit card information that belongs to a customer and then goes online to buy a nice gift for him or herself.

There are so many different ways in which this kind of fraud can occur. Yet these types of people tend to not be professional criminals who do this as a living. These are just people who jump at the opportunity because the opportunity presented itself.

Can online credit card fraud be controlled?

There are tools in the Internet world available that can deter online credit card fraud. Then again, there are common sense measures that need to be put in place as well. Some of these measures have already been mentioned, but they cannot be stressed enough. Here are precautions to take:

When a merchant does a credit card transaction, they usually receive an authorisation number specific to that transaction. See if you can obtain that authorisation number. For online transactions, getting those is not always possible, but when it is possible, you want to take the opportunity.

Never store personal and financial information on your computer.

Never perform transactions over an unsecure connection on a website.

Never give your information to any individual on the Internet in which they can freely use it for any transaction.

By taking the proper precautions and using common sense, you can avoid going through the hassles of being a victim of online credit card fraud.

Should I be worried?

Everyone who performs transactions over the Internet should be worried about becoming a victim of credit card fraud. Although online credit card fraud will never be completely eliminated, it can be reduced and that is why it is necessary to keep guard over your credit card accounts when using them online.

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