December 2014 | Print Friendly Version
With incidents of computer hacks and identity theft on the rise, consumers need to be aware that the act of shopping – either online or in person – can put their financial security at risk. Wealth Management Insights spoke to retired FBI special agent and popular Baird speaker Jeff Lanza about how shoppers can stay safe this holiday season.
What you should know:
- Consumer protection laws treat debit cards and credit cards differently.
- Credit cards offer the greatest protection against fraudulent purchases: Under federal law, your liability for a purchase you didn’t make cannot exceed $50, and unauthorized charges are often credited back to your account immediately.
- Debit cards also offer a $50 liability limit – if you report an unauthorized purchase within two days. Otherwise, your personal liability can increase to $500 or more, and it can take weeks for a bank to reimburse a drained account.
- Many financial institutions will let you set up personal fraud controls, such as a hold on any credit card purchase for more than $1,000.
- Shopping from the security of your own home carries its own risks.
- Be wary about links contained in emails or social media posts, as they could be an attempt to trick you into providing credit card information. Instead of clicking on a link to a company’s site, type the URL directly into your browser’s address bar. Once you’ve confirmed the site’s authenticity, bookmark it.
- Your Web browser can tell you when it’s safe to enter your financial information. Common indicators include a locked padlock icon, an address bar highlighted in green or an https:// prefix to the URL (the "s" stands for "secure"). These indicators confirm the website’s authenticity, and any information transmitted to and from the site is encrypted.
- When hackers compromise a website and capture user names and passwords, they will try them on as many popular websites as possible. Assigning different passwords for different websites can limit the financial damage they can do.
- Identity theft can be far more damaging than credit card fraud. With a stolen identity, thieves can open new credit accounts, take out loans, even file for bankruptcy – all in the victim’s name.
- Perpetrators of identity theft can piece together a new identity from your mail. Use a cross-cut shredder to destroy documents containing such personal information as credit card and bank statements, check copies and credit card applications.
- Your Social Security number is an identity thief’s most sought after piece of information. Don’t provide yours to anyone unless absolutely necessary, and don’t carry your Social Security card with you.
- Monitoring your credit history can alert you to a potential breach. You are allowed three free credit reports per year, one each from credit reporting agencies Equifax, Experian and Trans Union.
What you should do now:
Whether you’re shopping in a brick-and-mortar store or from your living room, staying alert to signs of fraud remains your best protection against having your finances compromised. Your Baird Financial Advisor can provide additional financial tips you can use in your daily life.