How Buying Gas Could Cost You Your Identity

Labor Day weekend presents a welcome opportunity to get out of town, spend a few days with friends and family and look forward to a shortened work week, but consumers aren’t the only ones excited about the holiday. Nearly 35 million Americans are expected to travel more than 50 miles from home this Labor Day weekend, the AAA travel forecast says, and about 29.7 million will do so in their cars. That means they’ll need to fuel up, and gas stations are a favorite target of credit card thieves.

Credit card skimming has been around for years, but people still forget (or don’t care) about the risk of someone stealing their credit card data when they pay at the pump. Devices that copy data from the magnetic stripe on credit and debit cards can be difficult for consumers to detect, even if they’re checking to see if the payment equipment has been tampered with. If the consumer is using a debit card, the thief may also copy the PIN when it’s pressed into the keypad, allowing him or her to use funds in the victim’s checking account.

Paying at a gas pump presents risks, but unless you plan to pay for fuel in cash, it’s something you have to come to terms with: You should regularly check your card transactions for unauthorized activity, and it’s also a good idea to take advantage of free transactional monitoring and alerts offered by many banks, credit card issuers and credit unions.

There’s another aspect of credit card fraud that is especially problematic at gas stations: self-service. If someone has a stolen credit card, there’s little to deter the thief from using it. The self-service aspect of paying for gas (unless you’re in Oregon or New Jersey, where self-service isn’t legal) makes gas stations a target for people using stolen cards, according to payments technology giant VISA. Their solution: technology that analyzes more than 500 data points of the card, such as whether it has been involved in a data breach, to assess the likelihood that the card has been stolen. The technology, called Visa Transaction Advisor, showed a 23% reduction in the rate of fraudulent transactions during a pilot test.

“This allows merchants to identify those transactions with a higher risk of fraud and perform further cardholder authentication before gas is pumped,” a news release about the technology says. If the card data is identified as one at high risk for fraud, the customer is prompted to see the cashier inside. It also says the technology has “a minimal impact” on the customer experience, and it is available to merchants to implement at their gas stations.

If that proves true — reduced fraud without bothering customers — it sounds like a potentially helpful product for any kind of merchant, not just gas stations. Meanwhile, the best thing consumers can do to protect their cards from being used fraudulently is to stay on top of their card transactions and report suspicious activity as soon as it’s noticed.

If you’re worried about identity theft, you can also spot signs of fraud by monitoring your credit regularly. You should check your free annual credit reports from each of the major credit reporting agencies for accounts you don’t recognize. You can also spot identity theft by monitoring your credit scores. Any unexpected, large change in your credit scores could signal identity theft. You can check two of your scores for free every month on Credit.com.