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11 ways to protect against debit card fraud

By Leslie McFadden ·
Monday, June 14, 2010
Posted: 9 am ET

Pop quiz: Can you be a victim of credit or debit card fraud if you still have the physical card?

As Sarah Palin would say, you betcha.  While card skimming isn't new, recent skimming incidents, such as those at Bank of America ATMs recently, should serve as a reminder to protect your cards every time you swipe.

Skimmers are devices that capture the data from the magnetic stripe on your card. "Criminals target ATMs because if they can get a card and a PIN then they can get cash," says Mike Urban, senior director of fraud management solutions at FICO, the company that created the FICO credit score. They can transfer the data to a blank card and then use it to make transactions.

Criminals can find out what your PIN is by setting up a camera or watching as you key in your code.

This afternoon I spoke with Urban, who offered the following tips for protecting your credit and debit cards:

  1. Update your contact information with your financial institution. Your bank can't ask you about a suspicious charge unless it has your current phone number.
  2. Copy the customer service phone number from the back of each of your debit or credit cards and keep this list in a separate location from your purse or wallet in case a thief steals the latter.
  3. Let issuers know your travel dates and destination. If your card gets swiped at an unusual location, the card issuer may decline the suspicious transaction.
  4. Sign up for banking alerts if offered by your financial institution. These will inform you when particular changes occur, such as irregular card activity.
  5. Stay away from ATMs that appear dirty or in disrepair. At best, such ATMs may not work when used, and at worst, may be fake machines set up to capture card information.
  6. Do not use ATMs with unusual signage, such as a command to enter your PIN twice to complete a transaction.
  7. Watch out for ATMs that appear to have been altered. If anything on the front of the machine looks crooked, loose or damaged, it could be a sign that someone attached a skimming device.
  8. Avoid using the ATM if suspicious individuals are standing nearby. Criminals may try to distract you as you use the machine to steal your cash, or watch as you type your PIN.
  9. Be aware that if your card gets stuck in the machine and someone approaches to help, it may be a scam. A criminal may be trying to watch as you enter your PIN code.
  10. If your card gets stuck in the machine, call your financial institution promptly to report the incident.
  11. As you key in your PIN, cover the keypad with your other hand to block anyone, or a camera, from viewing the numbers you type.

Remember to check your balance on a regular basis. Federal law doesn't protect debit cards to the same degree as credit cards when it comes to fraud. If you notify the bank within two days of discovering the card was lost or stolen, your loss is limited to $50. After two days, this amount jumps to $500, and after 60 days of receiving the statement with the fraudulent charges, your loss may be unlimited.

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July 16, 2010 at 8:22 am

I feel that ATM providers should take the corporate responsibility to ensure that ATM cards are safer anytime any where and a customer is always right. So bankers as well are responsible for this mess and reputation. Issues of customer protection and corporate governance should sound high on the agenda of many but banking corporates.

God forbid fraudsters. I hate em all.
For God and My Country!

Andy Deignan
June 14, 2010 at 10:13 am

There are technologies in the market place now that allow the issuers to decline transactions when a cloned or skimmed card is presented for use. One example is MagnePrint®. Think of it like a fingerprint, but a fingerprint of the actual magnetic stripe (not the data encoded onto the stripe, but the stripe material itself). No two are the same and they cannot be duplicated.

MagnePrint already exists on every magnetic stripe card ever issued because it is a naturally occurring property that is part of the card from the moment the card is manufactured. It’s already in your wallet.

The ATM owners now have access to this technology so they can use it to identify cloned cards and decline them before any cash is dispensed and fraud happens. BCI, a large bank in Chile has already deployed this at their ATMs and their ATM fraud has dropped to ZERO.