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Wave of debit fraud following breach?

By Claes Bell ·
Tuesday, April 24, 2012
Posted: 5 pm ET

It hasn't even been a month since news of the Global Payments data breach broke, and one personal finance reporter, Bruce Watson of AOL Daily Finance, is already noticing an uptick in debit card fraud. Where's Watson getting his information? His checking account statement.

Watson, along with those of several of his colleagues, noticed their checking accounts had been drained last week:

Standing next to the ATM on Tuesday, I stared at the receipt in my hand and tried to make the numbers add up. My wife and I had both been paid only a few days before, but our bank account now had less than $200 in it. Since we share our expenses, we each sometimes discover little surprises when she pays for a car repair or I cover a veterinary bill, but this was a big surprise -- and not a pleasant one.

When I got to the office, I looked up my account and quickly discovered the culprit: three charges totaling more than $1,800. I called my wife to make sure that she hadn't recently decided to buy a new Bose stereo system or made several hundred dollars in pharmacy purchases. A few minutes later, she was walking into the office of our local Chase Bank to talk to a human being about our almost-empty account. She had barely explained our situation before he burst out "Wow, I've had, like six people in this morning with the same problem!"

Like other debit card customers, Watson soon discovered the laws protecting debit card customers from fraud don't require banks to replace customers' funds until after a fraud investigation concludes, leaving them high and dry potentially for weeks.

Fortunately for Watson, he was conscientious about checking his statement. As Watson notes, should you fail to notice fraudulent charges for a few days, a bank could conclude you took too long to report them and your liability could go up to $500. After 60 days, you could be on the hook for all the fraudulent charges.

If Watson's experience is really being repeated across the country, Chase customers and other checking account holders should keep a close eye on their statement for the next few weeks.

What do you think? Should protections for debit card customers be strengthened? Have you been a victim of debit card fraud since the Global Payments breach?

Follow me on Twitter: @ClaesBell

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May 09, 2012 at 9:07 am

I am a recent victim of Visa debit card fraud and am quite sure it is linked to the Global Payments, I have past receipts from a merchant that uses their service. I received a call from Visa on Sunday 5/6 informing me that there is suspicious activity on my account. I live in Michigan, they were making charges to my account in Illinois just as I was making charges to it in Michigan. They got me from 5/3 to 5/6 for $715. If not the phone call from Visa, they could have wiped out my entire checking account.

May 01, 2012 at 10:56 am

Stop using debit cards until financial institutions figure out how to improve security. Use credit cards instead and pay off your balance twice a month to avoid fees. Unfortunately banks can pass on liability for fraud to customers too easily, whne the breah is their responsibility.