A method and system for detecting and preventing the fraudulent use of credit/debit cards. A number, referred to as a pre-stored Card Identity Key, is typically four or five digits in length, and the final two digits of this number are variable according to a formula which is applied at the time of the attempted transaction. The pre-stored CIK is created by the credit card owner or issued by the card-issuing financial institution, and is maintained in the card-issuing financial institution's computer database and used along with a software routine for validation. The software routine used for validation employs the formula, which is typically created and memorized by the card owner, to generate a dynamic Card Identity Key from the pre-stored Card Identity Key. The dynamic Card Identity Key must be entered by the card holder/user at a merchant terminal for validation of the transaction. Typically the internal time and/or date are displayed on the screen at the merchant terminal at the time the user's credit card is swiped, and at least a portion of the time and/or date shown is utilized in the formula to generate the dynamic Card Identity Key.