Contactless Credit Cards Could Be Trouble

(Credit card companies have been developing new “contactless” credit cards recently that you just swipe in front of the scanner and then you can be off with your purchases. )

Although these types of credit cards were developed to make life less of a hassle, a new kind of criminal could end up making them the bane of your existence.

Criminals are now taking the scanning machines that they can purchase just about anywhere and are scanning the cards to retrieve personal information.

So beware the next time you stick one of these tiny little cards in your back pocket because you could be a thief’s next victim.

A recent article by Liz Pulliam Weston of MSNMoney.com, “New credit cards allow hands-free theft,” looks into this new upsetting trend.

“Millions of so-called contactless credit cards have been mailed to Americans in recent months on the theory that we just don't spend money fast enough. While you're absorbing that little nugget, consider this as well: The cards, which wirelessly communicate information about you and your account, don't have an ‘off’ switch.”

“Contactless smart cards rely on radio-frequency-identification (RFID) technology to speed retail transactions. Instead of handing our credit cards to a clerk or swiping them through card readers, we just wave our plastic in front of a scanner. Often, no signature is required; it's whoosh and go.”

The gas conglomerate Mobile, was the first to introduce Mobile’s Speedpass, but since then major credit card companies have also jumped on the bandwagon.

The only inherent problem with these cards is that it is making it very easy for thieves to pull private information from the cards.

“The technology looks cool; the card issuers assure us these transactions are encrypted and safe. But privacy advocates aren't so sure. The problem, you see, is that radio-frequency tags are always open to wireless access, whether you're using them or not. So anyone with the right equipment can read the data, and the equipment needed to do so is getting cheaper and more sophisticated all the time.”

There have already been many cases were regular old people have gotten access to cardholder’s personal information just by holding a scanning machine up to their back pocket.

But there are ways to protect yourself if you are one of the many Americans who already have one, and it is actually quite easy.

“Your contactless card doesn't have such a shield, but you can buy RFID-blocking sleeves for your contactless cards or create a simple one out of -- seriously -- aluminum foil.”

“Card issuers say sleeves aren't necessary, of course. They insist the unencrypted account information that the UMass researchers found was an anomaly and that most contactless cards employ stronger security. Still, the idea that the card is always ‘open’ -- and that we might not be able to control who is picking up our information and what's being done with it -- should concern every consumer.”

So it goes to say that you basically have two options to avoid becoming a victim of this new type of identity theft. You can either call your credit card company and ask for a new regular card, or put a piece of tin foil around your wallet and call it a day.

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