Chip credit cards do not completely protect you from fraud

Chip credit cards do not completely protect you from fraud

HATTIESBURG, MS (WDAM) - Banks and financial companies have largely switched to chip credit cards to reduce identity theft, but local experts warn they do not completely protect you from fraud.

"The chip technology is good, but because the information that's on the card is not really encrypted," said Jeremy Graves, Information Technology Program coordinator at The University of Southern Mississippi School of Computing. "You can still, if you have the physical card, you can still use it. There's not a hundred percent guarantee."

According to CardHub, about 42 percent of retailers have not replaced their swipe card readers for chip card readers. Graves said identity thieves can easily and inexpensively remove personal information from magnetic strips when cards are swiped.

"If somebody's got a simple USB card reader that you can buy online for $20, and they've got it hooked up somewhere behind a counter, inside of a gas pump or wherever that device might be, and you swipe your card through there, your information is going to go wherever they wanted to capture it," he said.

Graves said splitting your bank accounts, one for the majority of your savings and one to use with a debit card, is one way to stay safe.

"I set up a separate account, so I have two accounts," Graves said. "One that has a card tied to it and one that doesn't. The one that does have the card tied to it has very little money in it."

He also said to be sure to keep track of bank accounts regularly.

"I have electronic (banking) set up. I get alerts anytime some transaction occurs, so monitoring your transactions at all times," he said.

Graves also said he will periodically ask for new credit cards, so the number is not the same for extended periods of time.

"I'll actually call and have my cards new number issued every so often," he said. "If it's a high dollar amount (in your bank account), you may want to do that even more frequently, you know, once a month or once every other month."

Graves said technology moves quickly, and he expects stronger security measures to be implemented in the future.

"Identity theft is on the rise, (and so is) the amount of money," Graves said. "This is probably a billion dollar industry, capturing and stealing information and stealing data, so there's too much to gain doing things the wrong way."

He suspects there will be stronger encryption methods for the cards themselves and added verification tools, similar to those used in online banking.

"If it was encrypted and then only a real credit card terminal could decrypt it, so to get to the information you have to decrypt it, that would take some of the devices that are being used to capture data away," Graves said. "If you have two forms to prove who you are, that may be something else they can do with cards. When the card gets swiped, a code gets generated back to your phone. Without that code, you couldn't use the card anywhere."