Foiling Financial Felons

Dec 6, 2017

The holiday shopping season is in full swing. But there are pitfalls a-plenty for shoppers; especially when they shop online.

Credit Tom Flanigan

First, here’s the really bad news:

“If you have a credit profile, for whatever reason you have an Equifax credit profile, your information has been lost. It has been hacked and so you are potentially a victim.”

Ben Graybar, financial leader and vice president at Hancock Bank in Tallahassee, said there's more bad news for those who shop on the Internet.

“Somewhere in the area of up to 46% of web sites have had the opportunity to be hacked on the backside, where you go to what you think is a legitimate site and it may well be, and that site has been compromised somehow where you’re downloading something other than just the purchase you were expecting on that web site and you didn’t even know it.”

Totally boycotting the Internet probably isn't a practical solution. So Graybar had this tip to minimize the risk.

“Shop with a credit card,” he urged. “Because if you end up with subsequent charges – and you can expect that you will – then at least you have a third party between that you can go to to help unravel the extra charges and get them refunded to you.”

But what if - for whatever reason - your only payment option is a debit card?

“Have a checking account that has no minimum balance tied to it and do not have overdraft protection connected to that card,” Graybar suggested. “Have that ATM/debit card connected with that checking account. Then you can go wherever you want to and shop with it and whenever you’re ready to make a purchase, you can log into your bank, manually transfer the money into that account and there’s only that much money in there. Execute your purchase and if the bad guy gets ahold of the number and tries to do something with it, there’s no money there to do it with.”

Of course, there are multiple ways bad guys can steal your identity and money.

“The number one thing I recommend is to look every day at yesterday on your bank accounts and your credit card bills. Because if I ask you what you had for lunch on Tuesday two weeks ago, because you just got your bank statement in the mail and you’re looking at a solid month, you don’t know the answer to that. But if you can say what you did yesterday, that’s pretty clear and easy,” he said.

And if there is a purchase you know isn't yours, contact the bank right away. You need to do this every single day, insisted Graybar, because it's getting ever tougher to figure out which purchases are yours and which are someone else's.

“The bad guys put charges on the card that are in line with what are the amounts of the regular (legitimate) activity and they are actually labeled with the fake company names. So if you’re looking at it, you see maybe Comcast, Amazon, etc. Except it’s not them; it’s the bad guys because they’re not just trying to steal money, they’re trying to cover it up and not have you not notice for a period of time.”

Graybar sadly reported the proverbial “little guys” are already at a bit of a disadvantage when it comes to protecting themselves from attacks on their bank accounts.

“Businesses – the larger ones, not really as much the smaller ones – have an opportunity to lock down their accounts and make it where they’re more bullet-proof where the bank will block any access from the bad guys going in and taking out money, or cashing checks without their permission, but on the consumer side, there isn’t that kind of protection.”

And now Graybar said more and more financial institutions are helping out.

“For example, Visa will let you do this for free; anytime there’s a Visa purchase on one of your credit cards, you’ll get a text or an e-mail that this purchase took place and that way if it wasn’t you or your spouse or whatever, you need to look into it and call the card company immediately.”

But what about old-fashioned shopping in actual stores? Graybar cautioned there can be dangers there from skimmers that read and transmit credit and debit card information to the bad guys.

“The good news is that a law went into effect the first of October that made possession of a skimmer illegal. So before then you could own one and it was just fine. The scary part is that the new ones are invisible. They’re a skinny sheet of metal that sits inside of an ATM or gas pump and you’re putting your card to be charged and if it’s inside then you can’t actually see it and your card will still work properly for the purchase.”

Meanwhile, a tiny camera hidden nearby can be recording your PIN or zip code so the thief has all your critical account information. Graybar said another option to consider is a credit freeze.

“If you freeze your credit, it’s not necessarily a bad thing,” he said. “It means that no one can go apply for credit and have an automatic response kick back in that says you’re approved because we’ve seen your credit. It doesn’t stop somebody from filling out a paper application and the vendor is not online and they say they’re going to give you $500 of store credit and they haven’t pulled your credit yet. It won’t stop that, but that’s a rarity. And the vendor – whoever does that – is taking on that risk of loss themselves.”

Graybar revealed one of the three big credit-reporting agencies is stepping up in this area.

“The big deal is now you can freeze your credit for free with Equifax through January 31st and they have put out a news release saying they’re going to make an app so that you can go on your phone and freeze and unfreeze your credit whenever you want. It’s a lifetime thing and I think this is going to be their reciprocity for having had the breach take place and your information go out on the dark web and be lost. So keep an eye out for that. It’s not necessarily a bad thing to do.”

All helpful hints to ensure happier – and safer – holiday shopping.