Checking Account Scams

Banking, Borrowing, Credit Rating, Investing & Retiring

Your checking account is a tempting target for thieves. You must stay alert for the many varieties of checking account scams – but first, you must be able to recognize a scam when you see one. Have you ever been targeted by any of the scams below?

Free Prizes – This scam usually starts with a postcard or a telephone call notifying you of a prize that you have won. If you respond positively, the telemarketer will ask you for your checking account number, either for verification or to use for direct deposit. Once they have your account number, scammers will be able to apply a “demand draft”, allowing them to withdraw funds directly from your account without your signature.

Variations of this theme exist, such as a special credit card offer that applies even if your credit history is suspect. In all cases, the end result is the same – the telemarketer will ask for your checking account information. Don’t give it to them.

Compromised Account Schemes – These methods attempt to instill a sense of panic and false urgency. You will receive a phone call, e-mail, or text explaining that your account has been compromised and that you must take immediate action to prevent damage. Texts or e-mails will direct you to false phone numbers and Internet links, where you will be asked for “verifying” account information.

If you really aren’t sure about the request, call your bank directly through a number you know is legitimate (the one on the back of your debit card is a good choice).

Online Purchases – Many legitimate websites and online auction services allow you to pay for items through a direct transfer from your account. Provide your bank’s name and routing number, your account number, and a billing address, and the transfer is complete. Unfortunately, fraudulent sites can spoof legitimate sites and fool you into submitting that same information.

Make sure that any purchases that you make via debit are directed to legitimate websites – or, better still, set up a PayPal account or use credit cards to serve as a buffer and increase your level of protection.

Account Takeovers – If your account information was compromised in any of the recent data breaches, thieves may have enough information to be able to impersonate you and get the remaining piece of information. For example, criminals may have enough information to pose as you and claim a forgotten password, allowing them to reset your password and take advantage of your account. Once they have control, criminals can transfer money out of your account at any time.

The thief may also alter your account in other ways, such as changing your mailing address to an address that they control. You may not realize that thieves have access until your account has been drained. Let MoneyTips protect your credit and your identity with a free trial.

Recognition is an important defense against checking account scams, but you can go a step further. Take pre-emptive action against account scams by taking advantage of any account alerts that your bank allows, and enabling two-factor authentication when possible. Two-factor authorization requires a secondary form of ID (often a code sent by e-mail or text that you must use to complete the transaction).

In addition, monitor your account regularly for any fraudulent transactions – but make sure you are doing so in a secure environment. Non-secure wireless connections expose your account information and your password to potential thieves.

Make it difficult for thieves to get away with checking account fraud, and they are likely to move on to easier targets – and if they do succeed, your proactive approach will help you to limit the damage.

Protect your credit – protect your identity – protect yourself with a free MoneyTips trial.

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