debit card

Robert Siciliano, a leading Identity Theft and Security expert, discusses in a recent post some of the major risks associated with the use of debit cards, liability regulations of debit versus credit, and how consumers can protect their finances.

“Not all plastic cards are created equal. The major differences in credit vs. debit is in the protections (or lack of protections) that come along with the fine print.A debit card is connected directly to a person’s bank account and when compromised can devastate your bank balance.”

Debit card regulation sets consumer liability for fraudulent purchases at $50 if they notify their bank within two days, whereas credit card users’ are allowed a sixty day reporting window.

If fraudulent debit purchases are not reported in two days, federal regulation allows the maximum liability to increase to $500.

Banks tend to be more skeptical and less flexible towards debit card fraud victims. In order to commit debit fraud, thieves need your card number and your PIN. If your PIN is compromised many banks will not assume responsibility for your loss.

So what should you do?

• Avoid using debit cards, use credit instead
  
• Carefully review your statements each month and refute any unauthorized charges as soon as you discover them
• If you plan on traveling, contact your credit card company ahead of time so they won’t put a hold on your card when out of state charges begin to appear
• Learn about card skimming and how to protect yourself
  
• If you need cash stick to bank ATM’s and avoid the privately owned machines you may commonly find in convenience stores, restaurants or bars. Not only are these generic machines more susceptible to tampering, but they also store your account information which may be accessed by others.

For more information read Robert Siciliano’s complete post Why Debit Cards can become a Nightmare on his blog

What steps do you take to protect your finances?

Tell us on Twitter @InteliusGal or leave your comment below.