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Updated on Monday, December 14, 2015
When Carrie Hemler logged into her bank account in late November 2015, she intended only to transfer money to her daughter at college. Instead she ended up noticing several transactions on her checking account that she didn’t recognize — and that added up to more than $3,600. Hemler had been hit with bank fraud.
Unable to Get Ahead of the Problem
“They were all pending, and I immediately called the bank,” says Hemler, 49, who lives in Westampton, N.J.
What she heard from the customer service representative, however, wasn’t too helpful.
“He said they really couldn’t do anything until the posts cleared,” she said. “I said, ‘This person is about to drain my bank account, I have a mortgage bill that’s going to post in two days, and you’re telling me I have to wait until these clear?’ I couldn’t understand why they couldn’t stop it.”
To make matters worse, Hemler then learned that even after waiting for the posts to clear, she’d have to file an official dispute at her local bank branch and wait seven to 10 business days to get her money back. Hemler was furious.
Using the Resources at Her Disposal
After speaking with a supervisor at the bank and receiving the same unsatisfactory answers, Hemler took matters into her own hands. Turning to social media, she posted on the bank’s Facebook page about her disappointment with its customer service and the steps they weren’t taking to assist her. Within minutes she got a response — and was soon on the phone with a customer service rep who was determined to look into things.
“This was probably 9 p.m. on a Sunday evening,” Hemler says. “She called me back first thing Monday morning to tell me what happened.”
Evidently someone in the Miami area had posed as Hemler and called the bank directly to place a travel hold on her account. “They said, ‘Oh, we’re vacationing in Miami,’ so nothing looks suspicious,” said Hemler. The hacker had already used a fake copy of Hemler’s debit card to make a small transaction, and then used that transaction to verify identity on the phone, along with Hemler’s name and address.
“It’s very scary because we don’t use our debit card for online purchases, so it has me a little freaked out,” Hemler says. “It’s very violating.”
Cleaning Up the Hack
The new customer service rep was able to credit Hemler’s account for the fraudulent transactions so she’d still have enough money to pay her mortgage and other bills. Then she suggested that Hemler get a chipped (EMV) debit card, which wasn’t available from branch locations but could be mailed from the corporate office.
She also recommended that Hemler add a security code to her account that would have to be verified every time she or her husband called the bank or visited a branch. Hemler and her husband received new, chipped debit cards, changed their PIN numbers, and changed the passwords on their bank logins.
“Having said all that, my husband and I have agreed that we’re pretty much going to stick to credit cards only and use the not use the debit card for transactions unless we absolutely have to,” Hemler says.
“I was lucky in that this person at the bank took care of me so promptly, but I’ve heard so many stories where it’s a nightmare to work with the bank,” she says. “If something appears on a credit card, it’s very easy for them to take care of it for you.”
Hemler was lucky in the end to have everything taken care of, but it could have been much worse. Check out this piece for seven reasons your debit card makes you a target for fraud, and this one for three strategies to help fight credit card fraud.
MagnifyMoney Action Plan
Identity theft is an incredibly stressful experience, no matter how financially savvy you are.
Here are steps to take if you become a victim of fraud:
- File police and FTC reports about the fraud.
- Pull a copy of your credit report and then place freeze on your report with each of the three credit bureaus (Experian, TransUnion and Equifax).
- File disputes about any incorrect information and close any bogus accounts.
- If you have trouble resolving any of these issues, don’t hesitate to reach out to the CFPB.
There is one way to reduce some of the risk that a thief will access your bank account:
- Use a credit card instead of a debit card your purchases, especially online.
Credit card fraud is annoying, but usually relatively simple to handle and banks can often detect unusually charges quickly. You should also have zero liability fraud protection on your credit card.
Debit cards and bank accounts, unfortunately, come with a different set of liability rules and it all depends on when you report the fraud. You could be liable for $50 if it’s reported within two business days after you find out about the loss, $500 if it’s more than two business days after the loss but less than 60, or even the full amount if you don’t report the loss for 60 days or more. Learn more about it here.