What is the Difference between Credit Card Fraud and Identity Theft?
It’s easy to confuse credit card fraud with identity theft, but they’re not the same thing. Let’s take a quick look at how they’re different.
Credit Card Fraud vs. Identity Theft
Credit card fraud is a potential consequence of identity theft. Here, a thief steals your credit card information and then makes purchases in a store or online. Most credit card companies have a liability limit of $50. This means that even if a thief has charged thousands of dollars to your card, you’d likely only have to pay $50. Often, credit card companies simply wipe out any charges that are the result of fraud.
However, identity theft can involve much more than a few fraudulent charges. Identity thieves can steal your personal information to open a new line of credit, open a new credit card, or obtain a false ID in your name. Unlike credit card fraud, there’s no liability limit. That means you might end up paying for all the damage caused by an identity thief.
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