Balance Transfer Fraud, How To Avoid The Hassle

What is balance transfer fraud? Simply put, balance transfer credit card fraud occurs when a criminal has completed a balance transfer on your credit card account without your knowledge or consent. Don’t fall victim to this increasingly popular fraud situation. Here you’ll learn several ways this type of credit card fraud takes place, how to prevent it, and how to fix it.

How did this happen?
With the ever growing increase in the amount of information available to the public these days, there are certain aspects of your personal information that are not considered secure. This includes information such as your name, address, phone numbers, family history, email addresses, the city you were born in, and the list goes on.

In the old days, when there was much less crime, most credit card issuers would ask for your mother’s maiden name when you called in to ask questions about your credit card. The scary thing is that some banks still ask for this information. With a little research on the internet, this can easily be found by a criminal. This is the first way balance transfer fraud can occur. Someone has gained access to your credit card number, your name, and has done some research to find your mothers maiden name. They call up the credit card issuer and request a balance transfer ON YOUR ACCOUNT.


Knowing your mother’s maiden name is not the only way transfer fraud can occur by phone. Criminals also have other tactics if they don’t already know your mothers maiden name. These include finding a customer service representative that will provide this information to them or one that is not paying total attention to the information given by the fraud when their calling into customer service. Also these types of criminals have been known to make multiple telephone calls to customer service after they have acquired your name and account number, guessing at your mother’s maiden name until they get it correct.

Another way balance transfer fraud can occur is through balance transfer checks. Criminals may access balance transfer checks that were meant to be yours by improper mail delivery, stealing your mail, and poor disposal of balance transfer checks after receipt. Once the checks are stolen by the criminal, they can write them to almost whomever they wish. They may deposit the check into their checking account or another credit card account they possess.

Don’t Let Those Scenarios Happen To You
Some ways you can prevent balance transfer fraud include the following actions.1. If your credit card issuer uses your mother’s maiden name when you call in, change it to a password that you can easily remember, such as your first pets name or your favorite entertainer. Make sure to use something that cannot easily be guessed. What I do to secure my accounts is make up an eight or nine letter phrase and use the first letter of each word. I always try and include one number also. For example:1Piece Of Cherry Pie Is My Favorite DessertMy password would then be: 1pocpimfd2. Never provide your password to anyone and try to make it something you can remember. It’s also best not to have the same password on every account.3. Properly dispose of any checks that you receive from your credit card company and are not using by running them through a paper shredder or tearing them into small pieces.4. Avoid receiving balance transfer checks at all by contacting your credit card issuer. Most companies will be more than happy to stop sending you checks if you request. You can always call into their customer service in the future if you need some.5. Always open your mail. Many checks are stolen from people’s trash if they aren’t properly disposed of. You don’t know they are there if you don’t open your mail.

Report Balance Transfer Fraud
Reporting this type of fraud to your bank is pretty simple. In most cases, you can just call them and advise them you found a fraudulent balance transfer on your monthly statement. Your credit card issuer then will send you a copy of the check written along with a security dispute form to complete.

If the fraudulent balance transfer was completed by phone, you’ll need to close your credit card and have a new number reissued. It’s always best to change your password on the account in this situation. Your bank will send you a security dispute form also when the fraud occurs by phone.

Credit cards chained up with padlock

Credit card issuers will not have a problem removing these fraudulent transactions from your account as long as the form is completed and the transaction is truly fraudulent. They will go as far as even crediting any fees and finance charges to your account that are associated with the fraudulent balance transfer.

Now that you have an understanding of balance transfer fraud, always be on the lookout. If it has not already happened to you, it may very well happen in the future.

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