Debit card identity theft can ruin anybody’s vacation. I was with a friend in Miami recently, when she discovered that her checking account had been drained of $1,200. We’d just had dinner at a restaurant where we’d split the bill using our debit cards. By the time we’d made it to the corner ATM to withdraw cash (not even 10 steps), her bank card had been deactivated.
After an agonizing call to her bank in the middle of the night, my friend discovered that the someone at the restaurant had processed three consecutive $400 charges using her debit card. As soon as the bank realized the charges were fraudulent, they reinstated her card and returned the funds to her account. As you can imagine, the experience ruined her night. Unfortunately, her story is not unique.
Debit card identity theft is a common occurrence. According to the FTC’s Consumer Sentinel Network, 2012 saw 31,000 debit card complaints, amounting to over $80 million worth of fraud — the equivalent of $2,580 per debit card. (Source: Consumer Sentinel Network Data Book)
Limiting Losses Resulting From A Lost Or Stolen Debit Card
Should your debit card be lost or stolen, The Fair Credit Billing Act (FCBA) and the Electronic Fund Transfer Act (EFTA) limit your liability. According to EFTA, you will not be held liable for any charges resulting from a debit card previously reported lost or stolen. How long you wait to report the loss will determine the amounts of money you owe. The longer you wait, the more you will be held liable (within two days/$50, more than two days/$500, more than 60 days/you could lose everything). Those who don’t monitor their bank and/or credit statements suffer the worst damage.
The next time you dine out, don’t send your debit card with the server. Request to have your payment processed at the table if possible, or pay at the register. Better, yet, pay with a credit card so that your bank balance isn’t affected, should something go awry. One last word of advice, don’t forget to monitor your statements at least once a month.
Thankfully everything worked out in my friend’s favor. It could’ve very easily been me.