Expert Article

Jim Cichy
Vice President of Fraud Management, PULSE
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Safe and Secure: Making sure your money stays yours

With the latest economic woes, consumers are turning to debit cards more and more. And with frequent debit card use, more criminals are including the payment option in their list of theft and fraud targets. To keep your money safe and secure, you need to better understand what you and your financial institution can do to combat security compromises and fraudulent use of your financial information.

Debit fraud techniques

When your debit card data is compromised, criminals can produce counterfeit cards as quickly as within an hour of the incident. Your account isn’t the only thing that is compromised – your sense of security is as well.

One of the most common fraud types that consumers face daily can be found online. You’ve likely seen at least one e-mail claiming that you need to provide personal information or your checking account will be placed on hold or shut down completely.

Recently, many consumers received an e-mail falsely notifying them that their credit cards may have been compromised due to fraudulent activity. Along with official-looking information and a false case ID number, cardholders were threatened with the suspension of online services if they didn’t verify their identity over the Web by providing sensitive financial information.

Other types of online scams promise rewards or financial gain for providing such information. A recently circulated e-mail promised that recipients would miss out on economic stimulus funds if they didn’t respond immediately and provide the requested information. The e-mail was, of course, a hoax, but the promise of wealth or rewards can often cause people to not vet sources of information as thoroughly as they should.

Occasionally, consumers can be taken advantage of without even being aware that anything is amiss on shopping Web sites. “Phishing” attacks can cause a Web page resembling or identical to a retailer’s to appear when a consumer visits. The difference is that the sensitive account and financial information isn’t processed by the retailer, but is instead sent to the hacker/phisher for fraudulent use.

A lesser used, but still prevalent, source of fraud occurs not through Internet connections but over telephone wires. Some consumers are often fooled into giving out personal information by official-sounding titles or financial institution names when contacted by phone. For example, in two recent cases, consumers were contacted via phone and asked to divulge personal and account information.

In Texas, text messages were sent to cell phone customers requesting them to call a bank and reactivate their debit cards. Callers to the number were prompted to provide personal information, such as debit card numbers or PINs. Also, customers of a Florida city utility department received automated calls requesting payment and a late fee for a utility bill. Customers were requested to provide card information over the phone for payment. These instances are perfect examples of phishing attacks that sound official and legitimate but can be avoided by knowing what information you should and shouldn’t share.

Keep in mind that, no matter how official an e-mail looks or a phone call sounds, financial institutions will never contact you over the telephone or Internet to request personal information, including account, card numbers or your personal identification number (PIN).

Fight against fraud

With the growing number of criminals targeting debit and credit cards, what can you as a consumer do to ward off possible scammers and fraudulent use of your personal cards? The first and most vital piece of the puzzle is often the simplest: don’t give out your PIN or other personal information. This includes not providing your PIN to tellers, retail customer service representatives or telephone marketers, all of whom should never ask for it to begin with. Your PIN is yours and shouldn’t be shared with anyone, written down or stored with your debit card.

Secondly, a great way to decrease the opportunity for fraudulent use of your debit card is to monitor your account frequently. In the event of a breach, monitoring your account will allow you to discover the unauthorized spending quickly. You can work with your financial institution to stop the activity immediately and potentially have most or all of your funds restored. Many financial institutions provide online access to accounts, which gives you an opportunity to monitor and watch your money daily. This helps you not only monitor for any unauthorized use, but also can help you keep track of where you are spending your money.

These and many more tips and suggestions on how to protect yourself against debit card fraud and scams can be found in the Safe and Secure section.

What financial institutions are doing

So now that you know how you can decrease your susceptibility to fraud and scams, what are financial institutions doing to reduce fraud? Many institutions and payments networks have rolled out technology-driven solutions that work to quickly identify and decrease fraudulent use of debit cards.

For example, financial institutions using the PULSE® ATM/debit network for processing are assisted by the company’s fraud detection system, designed to red-flag potentially fraudulent purchases immediately and notify the card-issuing institution. The system is always adapting to spending habits and will identify purchases outside of regular spending trends.

On top of individual company technology solutions, all companies that handle, store, process or transmit financial data must adhere to the Payment Card Industry Data Security Standard (PCI DSS). The security standard is designed to help organizations prevent fraudulent payment card use, hacking and other types of security issues.

Though fraudulent use of financial information is an issue, your knowledge of your finances and your financial institution’s efforts to stop fraud before it starts are certain to decrease your risk of attack.

For more information on steps you can take, visit the Card Usage Tips and Theft & ID Fraud pages.