If you’re like millions of Americans, you use your credit card to rack up loyalty points. These credit card rewards can be used for airline miles, hotel stays, retail discounts, and even to get cash back on purchases. Yet, according to a 2017 study by Bond Brand Loyalty and Visa, credit card users are sitting on about $100 billion in unused loyalty points.
The ease of redeeming these points makes loyalty accounts an obvious target for fraudsters. In fact, 11 percent of all card not present fraud targeted loyalty/reward points in 2017. Although less-obvious types of identity theft like child identity theft or medical identity theft may have more dire consequences, losing miles and points still puts you at risk. Not only do thieves take whatever cash or miles you’re owed, but they can also use the information to get more details on you — which can lead to additional identity theft attacks.
Here’s How It Works
Some hacks involve cracking into big systems (for example, Orbitz, Panera Bread, and Rail Europe have all experienced recent data breaches). But scammers looking for points and miles often prefer a more traditional approach: phishing.
Thieves send out phishing emails that look legitimate and may include invoices or vouchers for fake tickets. These attachments usually have embedded malware that can get into a user’s computer once the attachment is opened.
Unfortunately, thieves are also having luck with simply asking for user names and passwords, and then directing email recipients to fraudulent websites designed to capture information. In some cases, the thieves will take the user names and passwords and try them on numerous credit card and bank sites. Since people tend to use the same identifying details across multiple sites, there’s a chance they could unlock multiple accounts.
Whether you’re still collecting enough miles just to get a ticket home for the holidays or you have thousands of dollars racked up in cashback rewards, it’s important to stay on top of all types of credit card fraud.
Be sure to check your credit reports frequently for suspicious activity, but also take the time to look through statements detailing your rewards and miles. Also, update your passwords so they’re unique for each site, even seemingly minor sites like those listing your airline miles. Remember, any information an identity thief can acquire to piece together a profile of you can be used in multiple types of identity theft.
Catching a thief early may prevent other types of credit card fraud and in-depth attacks in the long run. Now, that’s a real reward.
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