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Stephen Lim, CPA, CA
Henry Yan, CPA, CA

The Ascent Team
Suite 105- 3380 Maquinna Drive
Vancouver, BC
V5S 4C6, Canada
Tel. 604.291-0366
Fax. 604.291.0367

How safe is it to use my credit card to shop and charge online?

Did you shop online this past holiday season? If you are like the millions of people who cumulatively spent almost $10 billion, you made at least one purchase via the Internet. However, many people are overly concerned about the security of their credit card information transmitted over the Internet and regularly choose instead to use a company's 800 number to call in their information. Although this method seems much safer, is it really?

It's ironic that a person who would never consider entering their credit card online to make a purchase over the Internet would happily hand that same credit card to a waiter in a busy restaurant or read the info to an order taker over the phone earning minimum wage. Did the waiter run the card twice? Did the order taker give the number to his friend or leave it lying around on his desk?

The truth is that there is no such thing as complete safety when it comes to your credit card. Whether you make a purchase online or in a store or restaurant, the possibility that credit card fraud may occur is a reality that must be acknowledged. Being aware of the risks related to credit card purchases and taking steps to minimize those risks will ultimately lessen the chance that you will be a victim.

Here are some tips to ensure your online shopping experience is a safe one:

Use a secure browser.
A browser is what you use to navigate the Internet. Most computers come with a browser (e.g., Internet Explorer, Netscape Navigator, etc..) already installed. You also can download some browsers for free over the Internet.

Your browser should comply with industry security standards, such as Secure Sockets Layer (SSL) or SET Secure Electronic Transaction. These standards encrypt or scramble the purchase information you send over the Internet, ensuring the security of your transmission.

Shop with companies you know.
Anyone can set up shop online under almost any name. If you're not familiar with a merchant, ask for a paper catalog or brochure to get a better idea of their merchandise and services. Also, determine the company's refund and return policies before you place your order. And as always, research is key. By knowing your vendor you can potentially avoid scams which may cost you both time and money.

Keep your passwords private.
Be creative when you establish a password, and never give it to anyone. Avoid using a telephone number, birth date, or a portion of your Social Insurance Number as these are commonly used and the first thing an online thief will try. Instead, use a random combination of numbers, letters, and symbols in combinations.

Review your statements.
Be prompt about reviewing your monthly bank and credit card statements for any billing errors or unauthorized purchases. Notify your credit card issuer or bank immediately if your credit card or checkbook is lost or stolen.

Check out online policies.
Read the policies of Websites you visit - especially the disclosures about a Website's security, its refund policies, and its privacy policy on collecting and using your personal information. Some Websites' disclosures are easier to find than others are - look at the bottom of the home page, on order forms, or in the "About" or "FAQs" section of a site. If you can't find a privacy policy, consider shopping elsewhere.

Taking steps to ensure that no unauthorized person uses your credit card information for their own personal gain is just another element of a good financial plan. If you have any questions about the safety of conducting credit card transactions online, please contact the office for additional guidance.

The information presented in this document is of a general nature only and should not be relied upon to replace professional advice. Before acting on this information, talk with a professional advisor as laws and regulations are constantly changing. Readers accept full responsibility; no document found here is a substitute for a consultation.

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