Team Clark is adamant that we will never write content influenced by or paid for by an advertiser. To support our work, we do make money from some links to companies and deals on our site. Learn more about our guarantee here.
Consumers across the country are on alert for potential account fraud after word of new security breaches at a couple of major retailers has again highlighted the weak consumer protections on debit cards.
The retailers in question are craft store Michaels and hard grocery discounter Aldi. In the case of Michaels, the exact number of customers affected is unknown. But this breach is spread out among Michaels stores in 20 states.
Criminals apparently entered the Michaels stores pretending to work for the point-of-sale company that handled their transactions and put skimmers on the POS devices! Those skimmers allowed the crooks to capture the debit card numbers and 4 digit PINs of customers.
The rules for debit cards are vastly inferior to credit cards in the event of account fraud. With debit card fraud, banks typically assume that you gave your PIN out even if it’s used by a criminal!
I had a recent call from a listener who tried to dispute a bogus debit card transaction and the bank tried to pull this funny business. I think it’s just mean-spirited and dumb. Banks don’t use modern card security; we are, I think, the last country on Earth that does not use smart chip technology. Instead we use magnetic strips that predates the modern computer era!
Here’s what you need to know: With credit cards, you have strong protections if a criminal obtains your number and uses it. With debit cards, however, it’s really the law of the jungle. You must be strident to protect yourself.
If a criminal has obtained your info and they withdraw money, your money is gone for good if you don’t notice it in time. You could have checks bouncing all over town. Most banks will say you’re guilty until proven innocent.
Keep these tips in mind:
I hope I’ve made you sufficiently paranoid, and that you now thoroughly check your statements when they come in. Especially if you shop at Michaels or Aldi as a debit-card customer!
Editor’s note: This segment originally aired in May 2011.
This post was last modified on March 22, 2017 2:36 pm
If you've been considering signing up for one of the Chase Sapphire credit cards, now…
The costs associated with owning a home go way beyond the amount on the mortgage. …
Inflation hits people on a fixed income the hardest. Say you're retired. You're living off…
Deciding to save and invest are great habits. But once you check that box, your…
If you're considering subscribing to Fubo, you need to be comfortable missing out on some…
Are you looking for a way to earn 2% back on every purchase you make…