What Is a Security Adjustment on My Credit Card?

A credit card security adjustment is a measure taken by a credit card issuer to safeguard an account from potential fraud or risk. This action protects cardholders from unauthorized activity and maintains the integrity of their financial accounts.

Understanding Credit Card Security Adjustments

A security adjustment on a credit card statement often appears as a credit or debit, labeled “security adjustment,” “fraud adjustment,” or “temporary hold.” This entry signifies a rebalancing of funds or a temporary restriction on a portion of the credit limit. For instance, a credit card hold temporarily makes a part or all of a credit card’s credit limit unavailable to the cardholder. Unlike a regular purchase, a hold amount may never be processed as a final transaction.

These adjustments are often related to suspicious activity, an ongoing investigation, or specific types of transactions. For example, when an authorization hold is requested, the card issuer makes a portion of your credit card balance unavailable until the transaction is finalized. This ensures funds are available for a potential future charge, commonly seen with hotel bookings or rental car authorizations. While a security adjustment does not directly alter the balance due, it can temporarily reduce the available credit limit, impacting a cardholder’s immediate spending capacity.

Common Reasons for Security Adjustments

Credit card issuers implement security adjustments as a protective measure. One primary reason is the detection of suspicious or potentially fraudulent activity. This includes unusual spending patterns, such as large transactions outside typical behavior or purchases made in different geographic locations from the cardholder’s usual activity. When such anomalies are flagged, the issuer may temporarily limit card usage to prevent unauthorized transactions until the cardholder’s identity is confirmed.

Another common trigger for a security adjustment involves temporary holds placed on funds for certain types of transactions. Businesses like hotels, rental car agencies, and gas stations often use authorization holds to ensure sufficient funds are available to cover potential costs or damages. These pre-authorizations are not actual charges but rather temporary reservations of a portion of the credit limit. The hold typically remains until the transaction is finalized or a specified period passes, which can range from one to 30 days.

Security adjustments can also arise from the resolution of a disputed transaction. If a cardholder disputes a charge, the credit card issuer may temporarily credit the account with the disputed amount while an investigation takes place. This provisional credit, sometimes referred to as a “security adjustment,” ensures the cardholder is not immediately responsible for the charge during the review period.

Internal account reviews by the card issuer, perhaps due to changes in a cardholder’s credit profile or unusual account behavior, can also lead to an adjustment in credit limits or account status. If a card is reported lost or stolen, the issuer will freeze the account and make an adjustment to prevent further charges, safeguarding the cardholder from liability.

Steps to Take When You See an Adjustment

Upon noticing a security adjustment on your credit card statement, carefully review your recent transactions. Examine entries around the date of the adjustment to identify any unfamiliar charges or credits. Paying close attention to the merchant name, date, and amount can help determine if the adjustment relates to a known transaction or an unexpected event. This step helps you gather specific details that will be necessary for further inquiry.

Next, compile all relevant information about the adjustment. Note the exact date, the amount, and any descriptive text accompanying the entry on your statement. If you suspect the adjustment is due to an unrecognized charge, gather any receipts or records related to transactions that occurred around that time. Having this information readily available will streamline communication with your card issuer.

The next step is to contact your credit card issuer promptly. The phone number for customer service is typically found on the back of your credit card or on your monthly statement. Many issuers also offer secure messaging through their online banking portals or mobile applications. When you contact them, clearly explain that you have identified a security adjustment on your statement and provide the details you have collected.

During your interaction, be prepared to cooperate fully with the bank’s instructions. They may ask you to confirm recent transactions, provide additional documentation, or answer questions to verify your identity. Responding accurately and promptly to these requests helps facilitate their investigation and resolution process. Following the initial contact, it is important to continue monitoring your account for any further adjustments or suspicious activity.

How Security Adjustments Affect Your Account

A security adjustment directly impacts your credit card account by temporarily affecting your available credit or the status of your card. When an authorization hold is placed, a portion of your credit limit becomes unavailable, potentially limiting your ability to make other purchases. This temporary reduction in spending power lasts until the transaction is completed or the hold is released, which can take several days.

In situations involving suspected fraud, the card issuer might temporarily suspend or even cancel your card and issue a new one. This measure is taken to prevent further unauthorized transactions and protect your account. While this can cause a temporary inconvenience in making purchases, it is a necessary step to secure your financial information.

It is important to understand that a security adjustment itself does not negatively impact your credit score. These adjustments are internal actions by the issuer to protect your account, not a reflection of your payment behavior or creditworthiness. Credit scores are primarily affected by factors such as payment history, amounts owed, and length of credit history. However, if a security adjustment is related to unaddressed fraudulent activity that leads to unpaid balances, that could indirectly affect your credit score.