Fraud Tip of the Day - June 9

The Hidden Dangers of Paying for Gas at the Pump

When you pay for gas at the pump with your credit or debit cards, you could be in for a big surprise.

Paying for gas purchases at the pump by credit card can expose consumers to several risks. The most common issues consumers may face are credit or ATM card skimming, hacking, and unposted surcharges.

Credit & Debit Card Skimming

Credit or ATM card skimming involves taking data off of your card at the point of sale, in this case a gas pump. Once the data is "skimmed" it can be used to create counterfeit credit cards or purchase items using the data. Thieves get the data by placing electronic devices over the real card slot and waiting for someone to come along and attempt to purchase gas.

The data is often sent wirelessly to a a computer in a nearby vehicle. Sometimes a camera is used to record PIN numbers, but a telescope will do the job in a pinch. Once the crooks have the card data and PIN numbers, they collect their skimming device and disappear. You won't even know what happened until strange charges appear on your statements.

If your debit card was "skimmed" and your PIN number captured, you could have big problems. All the funds in your account are at risk. I know that sounds scary, and it should, but you can reduce your exposure to the risk of card skimming by being smart. If something doesn't look quite right about a pump's card reader, find another pump or pay inside. Don't take unnecessary risk.

How to defend yourself against card skimming

• Pay for all purchases inside the the store whenever possible. Sign credit card receipts and make sure you get a copy.
• Carefully examine your credit card and bank statements monthly and report irregularities immediately.
• If you find a gas pump with a skimming device, report it to the local authories and warn the store clerk about the suspect pump

Debit Card Blocking

Consumers also need to be aware of something related to paying for gas at the pump with debit cards which isn't a scam, but can still cause grief down the road.

Using your debit card at a pump that doesn't require a PIN can cause an amount in your checking account to be blocked for anywhere from a few hours to a few days. If you aren't aware of it, the blocked funds can lead to bounced checks and insufficient funds for automated payments!

The reasononing behind this practice is that the gas companies don't know, in advance, how much gas you're going to put in your car. If the transaction required a PIN number there would be no problem. Those transactions are processed immediately. Transactions without a PIN are processed later in batches, usually within 72 hours. Since they have no way of knowing how much gas you're going to pump, they gas companies have devised this blocking system to help guarantee payment. Unfortunately, this means some of your money is frozen until that batch is run.

How much is blocked varies from gas company to gas company. Chevron claims it only pre-authorizes one dollar for gas pump transactions and that they do it to make sure the card is active. That's the low end of the spectrum. Many gas companies place a hold of as much as $75 on both debit and credit card gas pump transactions. It's not a huge sum of money, but if your money's tight and you don't have much in your account it can make all the difference in the world.

More Gas Pump Related Information