After the recent news about the data breach at Target that has potentially exposed millions of shoppers’ debit and credit card information to cyber criminals, you may be wondering what you can do to protect your accounts from fraudulent transactions. While the Target incident has received a lot of attention due to the sheer number of potentially affected consumers, it is important to remember that fraudulent transactions occur all the time in smaller, unpublicized numbers and that you should always remain vigilant to protect your information. The following are some simple steps you can take to protect your information and money from criminals.
- The most important step is to regularly review your account activity for misuse and report any discrepancies to your financial institution immediately.
- Save your receipts to compare with your statement.
- Memorize your PIN. Never write it on the back of your card or keep it in your wallet or purse.
- Try to keep your card in your possession at all times. If you give your card to a server at a restaurant, try to keep an eye on the card and make sure it is promptly returned to you.
- Never sign a blank receipt. Line through any blank spaces above the total.
- Cut up old cards and carry only the cards you need.
- Watch for any unusual attachments to an ATM machine or point of sale terminal. Thieves have been known to attach devices known as a “skimmers” to steal credit card information that they can later use for fraudulent purposes. Skimmers can be very sophisticated and discreet, so it’s always a good idea to pay close attention before you swipe your card.
- If your purse or wallet is stolen, the first thing you should do is contact the card issuers to have your cards cancelled.
- If you will be doing any unusual traveling, consider notifying the card issuer of your travel dates and destination to avoid the potential inconvenience of your card issuer mistaking your authorized activity for fraudulent transactions.
- When shopping online, only use your card with reputable companies that have the proper authentication and security software to protect your information.
- Do not share your card or PIN with others.
Despite your best efforts, you may still become a victim of credit or debit card fraud at some point. If you become aware of any fraudulent transactions, you should immediately report them to your financial institution in order to limit your personal loss. The Fair Credit Billing Act (FCBA) and Electronic Fund Transfer Act (EFTA) created limits for consumers’ liability for fraudulent transactions, but the liability amounts may depend on how timely the consumer reports the fraudulent activity.
For credit cards, the FCBA limits your liability to $50 for unauthorized use. However, if you report the loss or compromise of your card number before the card is used, then your liability is $0. If your card number is used, but you still have the card in your possession, you are not typically liable for unauthorized use.
The limits are a little different for ATM and Debit Cards. Similar to credit cards, if you report the card number stolen prior to any unauthorized activity, then you normally have no liability for a loss. However, if your card is used prior to you reporting it lost or stolen, the amount of your liability may depend on how soon you report the fraudulent activity after you discover it. If you report it within two business days of discovering it, your liability is normally limited to $50. If you report it more than two days after discovering it, but within 60 calendar days of receiving the statement, your liability is normally limited to $500. If you wait to report it until 60 days have passed from your statement date, then your liability may be unlimited.
It deserves mention that although federal regulations specify the most a consumer may be liable for in a fraudulent transaction scenario, card issuers’ policies may vary and some may limit the consumers’ liability even further. Many card issuers are now using “zero liability” policies as a marketing tool.
Fortunately, most card issuers have sophisticated fraud detection programs in place to detect fraud and often discover the fraud prior to the consumer realizing there is a problem. Card issuers will often call the cardholder to confirm unusual charges, and while this may be a slight inconvenience, it ultimately helps protect your account from fraudulent activity. Card issuers also use daily limits as a way to limit the losses in the event there is questionable activity. The card issuers’ efforts, combined with your vigilance, will go a long way to detect fraud early and limit potential losses. QCBN
Country Bank is a full service community bank serving Yavapai County with offices in Prescott, Prescott Valley, and Cottonwood. Ryan Glennan, NMLS # 478327, is a vice president of Country Bank specializing in commercial lending and residential construction loans. Please visit www.countrybankaz.com or call 928-443-9595 for more information.
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