Because of reduced access to credit and declining consumer confidence in the credit market, consumers are relying more on debit cards to make purchases. In fact,debit card usage rose 11% from 2003 to 2008 according to the Nilson Report, a newsletter that tracks consumer payment industry or Credit-Land.com. And as the number of debit cards grow, so do the amount of debit card scams. Seventy percent of the Nigerian banking scams are conducted through debit cards.
While a scam is a scam, credit card scams and debit card scams have one major difference. One affects imaginary money, and the latter effects very real, hard earned money. A credit card thief charges merchandise to your card and then resells the items. Debit thieves steal your pin number and/or account information to steal cash from your account. If a consumer is affected by a credit card scam, they can usually recover by relying on other funds, but if a debit card scam wipes you out, it can be debilitating.
“As economic conditions have worsened, there’s been a noticeable increase in all types of card fraud,” says Avivah Litan, an analyst specializing in fraud detection and prevention at Gartner Research in Stamford, Conn. “But ATM and debit-card fraud is the top area of concern we’re hearing about from banks all over the world”, – said Credit-Land Representative.
In DeWitt County, Texas, Sheriff Jered Shofner has warned residents of a telephone scam that has been going on. Several homes have already been affected by it, which involves automated telephone calls from personal numbers disguised to sound like they’re coming from financial institutions.
The recorded message informs the person that there is a problem with their debit card and proceeds to ask him or her to key in their debit card number for verification purposes. Once a thief has access to this information they have access to all the money in your account.
“Providing the numbers can lead to an empty bank account. Never give out your personal information unless you know exactly who you are dealing with, and they have a legitimate need for the information,” Shofner said in a written release.
Another scam in Arkansas sends a text message to phones explaining that their card is about to be deactivated, according to the KAKE website. In order to keep their card from being deactivated they must enter their debit account information.
In addition to the techniques listed above, skimming is another technique that consumers should watch for. Thieves set up equipment that captures magnetic stripe and keypad information from gas pumps, ATM machines, retailers, and restaurants.
Credit-Land Tips to on How to Protect Your Debit Card Information:
- Here’s how to keep those skimmers away from your money
- Never give out personal information unless you know who your dealing with
- Ask yourself is it legitimate reason for giving out the information?
- Call the bank, rather than accepting their call
- Check Your Bank Account Everyday – Don’t Wait for Monthly Statements
- Use your bank ATM, stay away from ATMs in grocery stores, street corners and ecluded locations
- Run your debit card as credit at gas stations and retailers
- Watch out for faulty ATM equipment, it may the sign of a skimmer as they add extra components to ATM devices to gain access to your ATM information.