Top 5 ways to avoid being a Christmas fraud victim

The holiday season is a time to spend with family and friends — not fraudsters. Make sure you don’t become the victim of a seasonal scam.

It’s an unfortunate reality that there are unscrupulous people out there that would take advantage of others for financial gain — especially at a time of year that is supposed to be characterised by goodwill to all mankind. 

With Christmas around the corner and a spate of parcels being delivered around the country, scammers have taken to imitating postal workers to con people out of their hard-earned cash. 

“These scams are common in the festive season and are sadly on the rise. This year, over $100,000 has been lost to parcel delivery scams with more than 400 complaints to the ACCC,” said Delia Rickard, deputy chair of the Australia Competition and Consumer Commission (ACCC).

How can I protect myself from fraud in the festive season?

1) Do your Christmas shopping on a secure connection only.

Never shop at an online store that does not display https in front of its web address, indicating a secure, encrypted connection. Also, beware of stores that ask you to pay by money order, bank transfer or other unconventional means.

2) If it sounds too good to be true, it probably is.

Unfortunately, deals that are exceptionally enticing can turn out to be no good at all. If you are suspicious about a website that is offering a price or delivery time that is too good to believe, check around the site for hints that it may be a fake. Look for weird email or URL addresses, poor grammar and other tell-tale signs of dubious activity.

3) Don’t download it.

There are very few things the average consumer would need to download that are not available from reputable vendors. If a website prompts you to download a file in order to proceed, double check that the service is legitimate. Downloading malware could give a scammer a sneak peak at your savings account, or they could use your computer as a bot in an attack on another system.

Oftentimes malware will be delivered in unexpected emails. If you’re prompted by an unknown sender to download something — especially an executable (.exe) or zip file — do not click on it! Mark the sender as unsafe and delete the email.

4) Do not give out credit card information.

Scams like the postal trick mentioned previously can be executed by email, phone call or even post. If somebody calls you up asking for your credit card details to complete a payment or process an order, hang up the phone.  These scammers will often pose as representatives of legitimate companies. If you feel that it may have been a legitimate request, you can check this by calling the company up on their publicly listed phone numbers, as can be found through an internet search or a phone book. Do not use a phone number provided to you to verify the origin of the caller.

5) Do not be embarrassed.

If you’ve unwittingly given out your details to a potential scammer or if you notice irregular activity on your credit card statement, do not be too embarrassed or proud to rectify the situation.

If you manage to catch a scammer early on, you can protect yourself and your bank account by reporting the suspicious activity to your financial institution immediately. Not reporting the possible threat could allow the fraudster free reign with your finances or identity.

Having your financial details revealed to a scammer is not only a security risk, but is an invasive abuse of your privacy. When it comes to your finances and online security this festive season, make sure you are vigilant about possible Grinches out there who would seek to steal away your holiday cheer.
 

 

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Learn more about credit cards

How do you use credit cards?

A credit card can be an easy way to make purchases online, in person or over the phone. When used properly, a credit card can even help you manage your cash flow. But before applying for a credit card, it’s good to know how they work. A credit card is essentially a personal line of credit which lets you buy things and pay for them later. As a card holder, you’ll be given a credit limit and (potentially) charged interest on the money the bank lends you. At the end of each billing period, the bank will send you a statement which shows your outstanding balance and the minimum amount you need to pay back. If you don’t pay back the full balance amount, the bank will begin charging you interest.

How to make a credit card online

If you’re wondering about how to make a credit card online application, here are some steps to follow:

  • Test the market. Many credit card options are available online. Compare providers by fees, interest and perks to ensure you’re getting the best deal.
  • Complete the application. Once you’ve selected a card, head to the provider’s website and complete the online credit card application form. Forms vary by providers.
  • Provide details. Most cards require you to meet age, residency, income and credit status condition, and you need to provide details like a bank account statement to prove this.
  • Review details. Ensure the information you’ve entered is correct.

How do you use a credit card?

Credit cards are a quick and convenient way to pay for items in store, online or over the phone. You can use a credit card as a cashless way to pay for goods or services, both locally and overseas. You can also use a credit card to make a cash advance, which gives you the flexibility to withdraw cash from your credit card account. Because a credit card uses the bank’s funds instead of your own, you will be charged interest on the money you spend – unless you pay off the entire debt within the interest-free period. If you pay the minimum monthly repayment, you will be charged interest. There are many different credit card options on the market, all offering different interest rates and reward options.

How to get a credit card for the first time

A credit card can be a useful financial tool, provided you understand the risks and can meet repayment obligations.

If you’re a credit card first-timer, review your options. Think about what kind of credit card would suit your lifestyle, and compare providers by fees, perks and repayments.

Once you’ve selected a card, it’s time to apply. Credit card applications can generally be completed in store, online or over the phone.

When you apply for a credit card for the first time, you must meet age, residency and income requirements. As proof, you must also provide documentation such as bank account statements.

Should I get a credit card?

Once you've compared credit card interest rates and deals and found the right card for you, the actual process of getting a credit card is quite straightforward. You can apply for a credit card online, over the phone or in person at a bank branch. 

How do you apply for a credit card?

You can apply for a credit card online, over the phone or in person at the bank. Once you’ve compared the current credit card offers, the application process is quick and easy. Before you get your application started, you’ll need to gather your personal information like proof of ID, payslips and bank statements, proof of employment and details of your income, assets and liabilities. To be eligible for a credit card, you’ll need to be an Australian citizen over 18 and earn a minimum of $15,000 each year. Once you’ve applied for a credit card, you should get a response fairly instantly. If your credit card application has been approved, you should receive a welcome pack with your new credit card within 10-15 days.

How to pay a credit card

There are a few ways to pay a credit card bill. These include:

  • BPAY - allows you to safely make credit card payments online.
  • Direct debits - set up an automatic payment from your bank account to pay your credit card bill each month. You can choose how much you want to pay of your credit card bill when you set up the auto payments.
  • In a branch.
  • Via your credit card provider's app.

How do credit cards work?

Think of credit cards as a short-term loan where you use the bank’s money to buy something up front and then pay for it later. Unlike a debit card which uses your own money to pay, a credit card essentially borrows the bank’s money to fund the purchase. When you apply for a credit card, the bank assesses your income and assigns you a credit limit based on what you can afford to pay back. At the end of each billing cycle, which is usually monthly, the bank will send you a statement showing the minimum amount you have to pay back, including any interest payable on the balance.

How to get money from a credit card

You can get money from a credit card, but generally it will cost you.

Withdrawing money from a credit card is called a cash advance, as it operates more as a loan than a simple cash withdrawal. Because it is a loan, you may be charged interest on your cash advance as soon as you make the withdrawal. Interest rates are also usually much higher for cash advances than standard credit card purchases.

In addition to the interest rate, you may also be charged a cash advance fee. This could be a flat rate, or a percentage of your total cash advance. If you are considering a cash advance, make sure to add up how much it will cost you before committing.

What should you do when you lose your credit card?

Losing your credit card is a serious situation, and could land you in financial trouble. Here is a simple guide detailing what to do when you lose your credit card.

Lock you card – Contact your provider and inform them about your lost credit card. From here lock, block or cancel your card.

Keep track of transactions – Look out for unauthorised credit card transactions. Most banks protect against fraudulent transactions.

Address recurring charges – If your card is linked to recurring charges (gym membership, rent, utilities), contact those businesses.

Check credit rate – To ensure you’re not the victim of identity theft, check your credit rating a month or two after you lose your credit card.

How long does it take to get a credit card?

There are a few stages you need to go through to get a credit card; each one takes a different length of time.

Applying for the card online, over the phone or in person is the fastest step. This usually takes around 15 minutes, provided you have all of your documents handy.

After submitting your application, it usually takes between one to 10 business days for the lender to assess your eligibility. Some lenders offer instant approval, although you will need to send supporting documents before it is official.

Once your application has been approved, expect to wait between one to 14 days to receive your card in the mail. Keep in mind that delays can happen during busy periods, such as if the lender has launched a special deal.

Current Interest Rate

This is the current interest rate on your existing credit card.

Where can I get a credit card?

Looking to get your first credit card? You might be confused as to exactly where to go to apply for one. Here’s where to go when you are ready to put in that application.

The bank: Your bank is a great place to start, provided that you have a good banking history. Since you already have a financial history, you have more chance of your application being approved.

Credit card provider: Another option is to apply for a credit card directly from the issuer, such as Visa, Mastercard or Amex. This will most likely be an online application, so do your research and apply for a suitable card for your circumstances.

Major retailers: Coles, Woolworths, Myer and David Jones all have credit cards available. But watch out for the interest rate and annual fees – these cards are designed to help you spend more in store.

Can a pensioner get a credit card?

It is possible to get a credit card as a pensioner. There are some factors to keep in mind, including:

  • Annual income. Look for credit cards with minimum annual income requirements you can meet. 
  • Annual fees. If high fees are a concern for you, opt for a card with a low or $0 annual fee. 
  • Interest rate. Make sure you won’t have any nasty surprises on your credit card bill. Compare cards with a low interest rates to minimise risk.