The Points Guy
- Someone recently used my family's Chase Freedom Unlimited for fraudulent purchases in Portland, Oregon while we were traveling in Denver.
- When you use a credit card in the US, you're protected with $0 fraud liability.
- With a debit card, on the other hand, your bank account could be drained - even if you eventually get the money back.
- Chase provided great customer service and removed the fraudulent charges within hours of calling to report the problem.
- See Business Insider's list of the best rewards credit cards you can get »
A couple of months ago I was in Denver visiting my parents. My mom had the kids and I was driving down the road with my wife enjoying a nice fall day.
Then her phone buzzed. It was Chase. There was suspicious activity on her account. We opened up her account in the Chase app and saw hundreds of dollars in charges over the last 12 hours or so… over 1,000 miles away in Portland, Oregon, where we used to live.
But while the card was used without our permission, I wasn't worried at all. I'm never liable for the cost when someone uses my card without my permission. Here's how it worked out so we didn't have to pay anything for the charges on the card.
Keep in mind that we're focusing on the rewards and perks that make these credit cards great options, not things like interest rates and late fees, which will far outweigh the value of any points or miles. It's important to practice financial discipline when using credit cards by paying your balances in full each month, making payments on time, and only spending what you can afford to pay back.
How we found out about the fraudulent activity
It's pretty amazing how well computers can guess if it really was you that used the card. Every once in a while they may get something wrong and block a transaction that's really you. It's happened to me a few times, but I can usually make it work with a text message reply to the bank.
While we hadn't reported to Chase that we were going to Denver, Chase figured out that we really were there and allowed our charges to go through as expected. The card is in my wife's name, so she got a text message that there was suspicious activity on her Chase Freedom Unlimited card.
She opened her Chase app and saw recent transactions at the Sheraton hotel by the Portland Airport for hundreds of dollars and what looked like a big pizza delivery and electric scooter rentals. While it sounds like they were having a good time trying to spend our money, it was time to put an end to it.
How we made sure the problem didn't get any worse
As soon as we recognized the charges, my wife called the number on the back of her Freedom Unlimited card. If you ever have an issue with your card, it's always safe to call the number on the back. If you ever get a call from someone who says it's your credit card company and it sounds suspicious, hang up and call the number on your card to make sure you're really talking to your bank.
We told the person on the phone which charges were fraudulent, and they were gone from my wife's recent transactions list by the end of the day. She got an email that the charges were removed, and we got new cards in the mail about a week later.
It was a hassle, but it didn't cost a cent
The Freedom Unlimited card is our "everything else" card.
We use a Chase Sapphire Reserve for travel, the American Express® Gold Card for restaurants and groceries at US supermarkets, the Chase Freedom where we can get 5% cash back (or 5x points) on the rotating quarterly bonus categories when we activate each quarter, and the Freedom Unlimited for everything else.
Our "everything else" spending gets us 1.5 points per dollar. Because while the Freedom Unlimited is a cash-back credit card, since we have the Chase Sapphire Reserve card which earns Chase Ultimate Rewards points, we can combine rewards between these two accounts to redeem the Chase Freedom Unlimited's cash back as points. Where our other cards would just give us 1 point, we use the Freedom Unlimited card. That means we had to update just about every subscription service we pay for with a credit card.
Video streaming, utilities, trash service, and even my daughter's preschool had recurring charges here. We also had the card saved to a handful of digital wallets where we can't get a higher rate. Updating everything was a hassle. But it wasn't expensive.
This is one reason I always use credit cards
If I used a debit card, this story might have ended differently.
When you use a debit card, fraudulent purchases and withdrawals drain your bank account. When you use a credit card, fraud is removed by the bank. All of the major credit card brands in the United States offer a zero fraud liability policy.
You can usually get your money back with debit card fraud, too, but it can take some time, and you might not get every dollar back. With a credit card, you just have to make one call, maybe fill out a form, and you're done. This experience just reinforced my use of credit cards everywhere I go.
Click here to learn more about the Chase Freedom Unlimited card »
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