It is amazing how easy it is for crooks to steal your credit card info and yet, it's so easy to fix if the banks would just update our antiquated credit card technology.

You may remember the scam story a while back where waiters and waitresses in some high-end restaurants were being equipped by a criminal ring with little credit card readers they could attach to an Android smart phone or iPhone.

When a patron presented his or her card, the waiter or waitress would disappear and before they ran the card legitimately, they would it through a card reader on their phone. Within minutes, other ring members would duplicate the cards and start making charges on those duplicates.

Thankfully the ring, which operated out of an apartment on Manhattan's West Side, was busted and so for 28 people have been indicted.

The problem with our credit cards is the magnetic strip technology on the back that was invented in the 1960s without a thought about security. Every other country in the developed world has since moved on to a smart chip technology, except the United States.

As a general rule, if you pay for a sit-down meal in a foreign country with a credit card, the card never leaves your sight. The staff brings your bill along with little terminal that you use to punch in a four-digit secret code, much like you would with an ATM card here in America. The embedded computer chip requiring the secret code eliminates the overwhelming amount of credit card fraud. It's not 100% safe, but it's much better than what we have.

Why are we not doing this at home? Because the banking industry has decided it doesn't want to spend the money to update the system. But I think it makes sense to require that the industry as a whole go to this system.

There are now a small number of U.S. banks that have adopted the chip and pin system, typically for people who travel a lot overseas. But we need to see more of this. How did we get so far behind rest of world? There's no excuse!

Image of Clark Howard About the author: Clark Howard

Clark Howard is a consumer expert whose goal is to help you keep more of the money you make. His national radio show and website show you ways to put more money in your pocket, with advice you can trust. View More Articles

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