Debit cards are very convenient because they make it easy to manage your accounts. But they also let anyone else control the account if they have your card and your personal identification number (PIN). And if you let someone else know your PIN, you may be responsible for anything that person does with it. In this section, you will learn:
- how debit card fraud happens
- how to protect yourself from debit card fraud
- what to do if you are a victim of debit card fraud.
Joseph usually used his debit card when he was shopping because it meant he didn’t have to carry around much cash. It was much safer, he thought.
One day, Joseph used his debit card to buy groceries at a corner store near his home, and typed in his personal identification number (PIN) as he chatted with the clerk.
“Time to get a new card reader,” he said. “This one’s so old, it’s cracking.” The clerk laughed and agreed.
The next month, Joseph was shocked to see that there was no money in his bank account. In fact, there were several purchases he hadn’t made, and he was overdrawn by over $700. He called the bank to complain.
“The purchases were all approved by someone using your PIN,” the bank’s customer service representative said. Joseph had to dispute the charges. The bank’s security department said that it looked like someone had tampered with the machine in the store, and used the store’s video monitoring tapes to watch Joseph enter his PIN.
The bank agreed to remove the charges from Joseph’s account and told him about steps he could take to protect his PIN when using his debit card.
Lessons Joseph learned:
- Don’t use a card reader that looks as if someone might have tampered with it.
- When you enter your PIN, cover the card reader from anyone who can see it, including security cameras.
- Check your banking statement regularly and inform the institution if there is anything you don’t understand.
Debit card fraud can happen in several ways:
- A card reader or automated teller machine (ATM) may be altered to copy your card and record your personal identification number (PIN).
- A thief may watch you enter your PIN and then steal your card.
- Someone may run your card through a reader while your attention is distracted.
- A stranger may help you retrieve your card from a jammed ATM, and make note of your PIN or steal your card.
Usually, a thief needs your card (or a copy made from real data) plus your PIN. Keep both safe. You are not responsible for anything beyond your control—if you are a victim of force, trickery, intimidation or theft. But if you let someone use your PIN, or if your financial institution thinks you have been careless, you may have to pay for any charges on your card.
Once scammers steal your card and PIN, they can get the money in your account. They can get even more if your card can be used for other accounts, or if you have overdraft protection on your account. When someone uses your PIN and debit card to get illegal access to your accounts, or to make other charges in your name, it’s fraud.
If you think someone might have access to your debit card, contact your financial institution. The security department can tell you what to do next.
For more information about your rights and responsibilities under the debit card code, see The debit card code in the Your Rights and Responsibilities section.
What can you do to protect yourself from debit card fraud?
Here are some tips:
- Always protect your personal identification number (PIN): use your shoulder or your hand to shield your PIN when entering it into the keypad.
- Never tell anyone your PIN—including family, friends, financial institution employees or law enforcement agencies.
- Keep your debit card in a safe place and don’t lend it. If someone knows your PIN, change it immediately or cancel the card.
- Memorize your PIN. If you must write it down, disguise it. For example, re-arrange the numbers, substitute other numerals or symbols or keep it with other information. Keep it separate from your card.
- When selecting a PIN, don’t use obvious information. You could be responsible if you use your name, address, telephone number, date of birth or social insurance number.
- If your card is lost, stolen or stuck in an automated teller machine (ATM), or if you find that there has been an unauthorized transaction, notify your financial institution immediately.
- Watch out for anyone (or a camera) that might be able to see your PIN.
- Swipe the card yourself, or watch if you give it to a clerk to swipe.
- If you have made a purchase that does not show up on your monthly statement, notify your financial institution. The card reader used for the purchase may have been a fake machine designed to steal your PIN.
For more information about debit card frauds and other scams, check out these resources: