The new way to fight fraud: a one-time credit card number you can throw away


Is there a solution to credit card fraud?

Hackers have potentially hacked into the credit and debit card data of more than 5 million customers of parent company Saks Fifth Avenue, Saks Off Fifth, and Lord & Taylor stores, according to Toronto-based Hudson’s Bay Co., owner. retail. brands. The company said on Sunday it was investigating the violation.

There may be a solution to this type of credit and debit card fraud. Capital One COF,
last month announced a new feature for its credit cards called “virtual numbers”. These are single-use numbers that consumers can use when shopping online so they don’t have to give their actual Capital One credit card number to an online retailer.

To obtain the virtual number, cardholders must visit their Capital One online profile, via the Capital One website. There they can find a tool called “Eno Virtual Numbers,” named after Capital One’s Eno virtual assistant. The tool creates unique virtual numbers for each merchant, linked to their Capital One credit card account. But online retailers don’t get the actual number printed on the consumer’s physical credit card.

The service is only available on desktop, but will work on Capital One’s mobile app in the future.)

It’s Capital One’s latest response to the fight against online credit card fraud. Several banks, of which Bank of America
+ 0.60%
and Citi
+ 0.15%,
have launched similar systems.

When credit card fraud is detected, “I have to swipe and update my card wherever I have ever put it,” said Tom Poole, senior vice president of digital payments and identity at Capital One. “But if you’re like me, you don’t know where you put your card.”

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That’s why using a “virtual number” might be a good idea, especially when shopping on unfamiliar sites, Poole said. Capital One stores each number online and the cardholder can cancel a virtual number at any time. In theory, cardholders can use a different virtual number each time they shop.

Another way to use it, albeit with strict supervision, is to give a child a virtual number, for use on a computer or an online video game, Poole said.

Retailers are making their own efforts to fight fraud, but they continue to report consumer information breaches. Some 44% of consumers have received a fraud alert in their lifetime on their credit or debit card, according to a survey in 2017.

The number of compromised debit and credit cards at ATMs and stores in the United States actually increased by 70% between 2015 and 2016, as scammers became more sophisticated. And experts say it’s a good idea to continue to use fraud alerts and checking accounts frequently.

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