Robert Siciliano Identity Theft Expert
A recent Unisys study found that, in the midst of the global financial crisis, American’s primary fear is credit and debit card fraud. 68% of those surveyed are extremely or very concerned about the security of their credit or debit card data, and 66% are extremely or very concerned about identity theft.
Compare that to 58% who are extremely or very concerned about terrorism and war, and 41% who fear the possibility of a serious health epidemic. If we actually had a pandemic, I’m sure the public would favor health concerns over money. But so be it.
Credit card fraud comes in two different flavors: account takeover and new account fraud. Account takeover occurs when an identity thief gains access to your credit or debit card number through criminal hacking, dumpster diving, ATM skimming, or perhaps when you hand it over to pay at a store or restaurant. Technically, account takeover is the most prevalent form of identity theft, though I’ve always viewed it as simple credit card fraud.
Federal laws limit cardholder liability to $50 in the case of credit card fraud, as long as the cardholder disputes the charge within 60 days. Debit card fraud victims must notify the bank within two days in order to be protected by this $50 limit. After that, the maximum liability jumps to $500. And if a victim doesn’t discover or report the fraud until after 60 days have passed, the liability could be the entire card balance, for a debit or credit card. Once your debit card is compromised, you might not find out until a check bounces or the card is declined. And once you do recover the funds, the thief can just start all over again, unless you cancel the account altogether.
1. Protecting yourself from account takeover is relatively easy. Simply pay attention to your statements every month and refute unauthorized charges immediately. I check my charges online once every two weeks. If I’m traveling extensively, especially out of the country, I let the credit card company know ahead of time, so they won’t shut down my card while I’m on the road.
2. Protecting yourself from new account fraud requires more effort. You can attempt to protect your own identity, by getting yourself a credit freeze, or setting up your own fraud alerts. There are pros and cons to each.
3. Invest in Intelius Identity Protect. Because when all else fails you’ll have someone watching your back.
Robert Siciliano Identity Theft Speaker discussing credit card and debit card fraud on CNBC