Howdy!

I get this question asked a lot. The short answer is, no. Any time you use an electronic form of payment whether you are putting the digits into a website or swiping your card at the gas pump, you are taking a risk that someone will record those numbers and do something nefarious with it. My wife and I have had our bank account compromised several times. We can personally attest that it happens.1DollarBillPlain

Aha! Back to Cold Hard Cash?

 

With all the stories about electronic theft and all the services like Life Lock out there claiming that personal economic collapse is imminent, it’s not hard to understand why some are timid about shopping online. While the risk is real, it’s not at the level that some would like to claim. There are several things you can do to reduce your risk. Here are a few steps will help protect you from thieves both online and off.

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Disconnect your bank account from your payment method

There are several services out there that will give you a debit or credit card that you can fill from your bank account. BBT’s MoneyAccount is one of these services. PayPal offers something similar. Rather than the card take money directly from your checking account, you add money to the card as you like. Want to make a $100 purchase on Amazon? Use the banks website to transfer the money from your account to the card (this can be done by phone as well) then safely make your purchase. The idea here is that this payment card is not linked directly to your bank account so the worse that can happen would be to have the balance on the card stolen. If the card is misused, you there is 100% fraud protection on all of these services. Most have a small fee associated with their use. Your existing bank probably offers a form of this service. The key here is that the card you are paying with is not linked directly to your checking account.

Dedicated Credit Card

If you have the discipline, another way to accomplish disconnecting your bank account from your payment method is to dedicate a credit card for that use and pay it off before the interest is charged. This is another great option because most (if not all) credit cards come with fraud protection and is usually an easy process if the card gets compromised.

Stay Vigilant

Whether you continue using a payment method connected to your bank account or go with one of the solutions above, you’ll want to regularly review your purchase history. When our accounts have been compromised it was pretty easy to spot. Most of the time our bank’s fraud alert team sees it and contacts us. They find problems automatically by monitoring our account for odd purchase behavior. If we use the card somewhere local and 20 minutes later the card is used in The Bahamas, it tends to set the bank alarms off. None the less, you still need to keep an eye out for purchases that don’t look familiar to you. If you spot one, engaging with the fraud protection service is, in our experience with 3 banks, fairly painless.

Well, I’ll just stay off the internet then!

This is a common reaction when folks talk about this issue. The truth is that online purchasing is just one of a set of risks we face with our bank accounts. Skimmers that record your credit card information before passing it on to the bank for verification are frequently used at gas stations and restaurants. The thief then uses the digits of your card to make purchases or sells the digits to a group of criminals for later use. Electronic theft isn’t just an online problem. If you keep your money in a bank, you are at risk.

Return with us now to those thrilling days of yesteryear…

The days of operating purely on a cash basis are gone my friends. For many goods and services local stores just can’t compete with online providers such as Amazon. The net effect is less availability and higher prices locally.  Turning back the clock isn’t really possible, but you can be prepared.

Still concerned and have questions? Feel free to ask them on my Facebook Page, because, well, I-SpeakNerd.

–Wes