Credit Card Cloning: What Is It , How It Works, and How to Protect Yourself

Discover a charge on your credit card that you don’t recognize. It could be from a card cloning event. Card cloning predominantly affects credit cards, but this phenomenon may also impact some payment platform cards (like those from PayPal or Zelle). In short, card cloning occurs when the card’s magnetic strip or chip is used in unauthorized transactions. 

Credit card cloning is a form of fraud, but it differs from others in its more nuanced elements. Find everything there is to know about credit card cloning below, from how it works to its variations, prevention methods, and even steps to take if you think scammers recently cloned your card. 

What Is Credit Card Cloning?

Credit card cloning includes the unauthorized duplication of a card’s magnetic strip or chip information. These schemes differ from other forms of stealing fraud in that the scammer only looks for the card’s strip or chip data rather than the account numbers or the card’s PIN. For this reason, card cloning is most common at gas stations and Automated Transaction Machines (ATMs). 

What are clone cards? If a card’s strip and chip data is stolen, scammers can use it to create a “clone card.” These may be physical cards, but they are often details associated with a victim’s authentic account. Depending on the scammer’s goals, they could use this account for quick withdrawals, transactions, or other fraudulent schemes. Moreover, strip and chip cards aren’t the only account assets at risk. Contactless cards, like those equipped with tap-to-pay functions, may also fall victim to card cloning.

How Does Credit Card Cloning Work?

How do fraudsters manage to “duplicate” your card and use your funds for unauthorized payments? Here are their main weapons. 

Skimming Devices

The most common way fraudsters can clone credit cards is by using “skimming” devices. These are usually authentic-looking card readers that take a snapshot of the card information entered into them. They look the same as typical card readers and are challenging to detect at ATMs, gas pumps, or when installed over standard point-of-sale devices. 

Data Breaches

Card cloning can also be a byproduct of successful data breaches. Attacks that produce card information for American Express, Mastercard, and Visa cards are high-volume targets in such events; investigators have found cloned cards with verified PINs being sold on the dark web for as low as $20. Consequently, organizations that save their clients’ payment details have a higher risk of financial fraud and identity theft than their secure counterparts.

Card Duplication

How do clone cards work after a fraudster collects the information they need from physical devices like skimmers or the dark web? If the scammer needs a physical card, they can load a blank with the stolen information, swipe, and use the false card as any other authentic card. Alternatively, a scammer might use the card details to locate and manipulate funds, depending on their goals and available technology.

Contactless Cloning (RFID)

As mentioned above, contactless cards are also at risk for cloning. Contactless cards are generally tap-to-pay, which includes a specialized magnetic code related to a consumer’s card—when an authentic transaction occurs, that code is read, verified, and recorded when the purchase finishes. However, fraudsters have recently begun creating scanners (RFID) that can read and record these codes, even at a distance. 

Signs Your Credit Card May Have Been Cloned

• The clearest sign of your card being cloned is unfamiliar or suspicious transactions within an account statement. Whether there is one significant transaction or many small ones, if the account holder does not recognize the purchases, they should seek assistance. 
• Clone cards attached to accounts with advanced security may also show signs that something has gone wrong, especially if there are declined transactions regardless of the active account balance. Transaction authentications are a significant reason why these fraudulent purchases fail more often than not.
• Consumers worrying about clone cards can also benefit from reviewing notifications from their financial institutions about strange behaviors related to the account. Warnings can also appear at the end of monthly statements. These messages may include data about a login from another country or the confirmation that some contact details have recently changed. 
• Credit card cloning is also evident when account histories show multiple small but unauthorized transactions. These dollar-or-less deposits and withdrawals are used to verify an account’s status and test a card’s access to the profile. If the card passes the scammer’s tests, the account will likely be abused later.

Tips To Prevent Credit Card Cloning

Here’s how you can keep your card in safe condition and avoid falling prey to scammers. 

Be Vigilant at ATMs and Gas Stations

Clone card scams can be physically prevented by consumers inspecting card readers for signs of tampering. Most skimmers fit neatly over a scanner of the same type, so consumers may be well served by touching and shaking a card reader before scanning and authorizing their transactions.

Use EMV Chips and Contactless Cards

Those who have not yet switched to tap-to-pay cards should consider the switch. Contactless options protect both the strip and the chip of a card, giving additional protection from skimmers. Most skimmers rely on the consumer swiping their card, while chip readers require victims to insert their card fully. In comparison, contactless cards have an RFID weakness—but don’t worry—that can be fixed (below). 

Monitor Your Bank Statements Regularly

Card cloning works by allowing the scammer to act as if they are the owner of an authentic card. This means that when card cloning is successful, those transactions will appear as valid purchases, at least as far as the financial institutions are concerned. Consequently, account holders cannot rely on institutions to ‘catch’ these schemes—only the cardholder can discern authenticity from falsified transactions. 

Enable Alerts for Transactions

Another way to avoid credit and debit card cloning is to enable real-time notifications for financial accounts. While this may not stop a fraudster from making a one-time complete withdrawal of an account’s balance, it can alert account holders to a fox in the hen house. 

Avoid Public Wi-Fi for Transactions

Fraudsters can use various methods to collect a consumer’s financial information. One of the least talked-about methods is using public Wi-Fi connections. These schemes work by a hacker injecting reading and recording code into an insecure Wi-Fi network, allowing the scammer to collect all the data on the network, including keystrokes, account login details, and system pages.

Use RFID-Blocking Wallets 

The problem with contactless cards is that they are still vulnerable to RFID scanners. These scanners can read and record a card’s tap-for-purchase details, organizing the data into a parcel for the orchestrating fraudster. However, cyber security experts have developed defenses to combat this challenge—consumers can purchase RFID-blocking wallets, cards, and accessories. These protect contactless cards and prevent their sensitive data from being read by scammers with the right tools.

How To Respond If Your Credit Card Is Cloned

Unfortunately, many realize what happened only when the fraud is already completed. If you’re one of those people who noticed the scam when it was already done - keep calm and strong. Certain tips can help you find the best way out of this situation. 

Report Fraudulent Activity Immediately

Those who suspect their card information was cloned must contact their financial institutions immediately. Consumers must tell providers like banks, payment platforms, and third-party card issuers about the suspicions to take the proper defensive steps; without this warning, providers may not notice or realize that a threat is manipulating data. 

Freeze or Cancel Your Card

After reporting your suspicions to the impacted financial institutions, also take time to freeze your credit score or cancel the exposed cards. Canceling any card that may have been compromised through a skimmer, data breach, or any other cyber event is critical.

Monitor Credit Reports

Moreover, those who freeze their credit have a good starting point for manually assessing it in the future. Consumers can also hire credit monitoring services that perform routine checks on their accounts. The automated monitors can help immediately notify victims of misused credit or fraudulent threats within the account.

File a Police Report

Potential card cloning victims also benefit when they take the situation seriously and notify all the necessary people, including law enforcement. Further, they can assist experts in learning how the scammers succeeded (or didn’t), which can inform the development of state and government defenses. 

For example, the Federal Trade Commission offers an online fraud reporting tool that allows professionals nationwide to review and inspect the details of a reported crime. The FBI also offers an online tool called the Internet Crime Complaint Center. Filing a complaint allows agents to review and develop national defenses and policies that serve the public.

Card cloning scams threaten every consumer who carries a card. It used to be that a card’s magnetic strip was enough security for a financial account, but those days are behind us. Now, strip skimmers and chip lifters are commonly used by fraudsters to collect card details, and while contactless cards are a significant improvement, they also have vulnerabilities to consider. There are many ways to prevent cloning schemes, including monitoring financial accounts, avoiding public Wi-Fi connections, and being cautious at ATMs and gas stations. Consumers at all levels must take the time to review cyber security trends, especially when fraudsters are constantly developing new tools—learning about those technologies early on can help prevent severe damages later.