ConsumerCents - Keep Your Change: 7/1/2011 Issue

Financial Knowledge is Power

Debit Card Fraud on the Rise

According to a report by Javelin strategy & Research, debit card payment volume exceeded credit card volume for the first time in 2009. As consumers continue to increasingly rely on cash and debit cards to avoid credit card debt, the rate at which consumer debit cards are fraudulently used also continues to grow.

This same report notes that debit card fraud accounted for 36 percent of all card fraud in 2010, and that 1.4 percent of consumers are victims of debit card fraud each year. What many consumers don't realize is that recovering from debit card fraud can be a much more painful and lengthy process than recovering from credit card fraud.

Most debit cards are tied to a checking or savings account. So, when you lose money through a debit card, you're losing actual cash that you've earned and deposited. Your financial institution won't reinstate the funds until after they complete an investigation of your claim - a process that can take anywhere from 7 to 14 days. Not having access to your cash for that long could affect your ability to pay other bills on time. Many consumers are unaware of this difference since fraudulent credit card transactions are not tied to a cash account and can be removed quickly.

The first thing to realize is that anytime you use a debit or credit card, you are at risk of fraud. That's one of those pesky facts of life. You can, however, minimize your risk by taking precautions and being aware of common methods thieves use to steal your information. The following is a list of best practices to keep your information safe.

Monitor Account Activity. While this is a good financial management habit regardless, frequent monitoring of your account activity will help you respond quickly to any unauthorized transactions.
Be Aware of Your Surroundings. Cover the keypad anytime you enter your PIN, even when using ATM machines. This will prevent any people or recording devices lurking nearby from capturing your information.
Use Bank Alerts. Most financial institutions now allow you to send certain spending or transaction alerts to your email address or phone in addition to online/mobile banking.
Avoid Rundown ATMs. Machines that look rundown, have signs of damage, or other visible flaws (loose parts, etc.) can indicate the machine has been tampered with. Play it safe and avoid using them.
Run Your Debit Card as Credit. Many establishments allow you to run your debit card as credit. The money still comes out of the cash account linked to your debit card, but you can sign for the transaction instead of using your PIN.
Shop Securely Online. When shopping online, make sure you are using secure websites (usually indicated by an https in the url instead of the standard http). You may consider having an account specifically for online shopping that is not tied to your general funds, or using other secure payment services such as Paypal to complete your online transactions.

It's also important to remember that debit and credit card fraud are both forms of identity theft. Depending on the severity of the fraud, they can have significant effects on your credit report and credit standing. Be sure to visit ConsumerCents.com. and download the Identity Theft booklet for more information on protecting your identity. You may also speak with our Certified Financial Counselors at 800-351-4195 for help recovering from identity theft.

Hot Topics & Industry News

AAA Fair Credit Foundation Selected to Qualify Homeowners for the EHLP Program

We are happy to announce that we have been selected to qualify Utah homeowners for the Emergency Homeowners' Loan Program (EHLP). The EHLP, recently implemented by the U.S. Department of Housing and Urban Development (HUD), provides $1 billion to assist homeowners at risk of losing their homes.

Homeowners who have experienced at least a 15 percent drop in income due to economic hardship caused by unemployment, underemployment, or medical emergency may be eligible to receive a zero interest forgivable loan that can be applied to past due mortgage payments, including missed payments and late charges. Maximum loan amount is $50,000 per household.

We are currently accepting pre-screening applications from Utah homeowners. To be considered for this program, homeowners must complete the Pre-Applicant Screening Documents and submit them to AAA Fair Credit Foundation by July 22nd. For questions about EHLP, call 866-217-1214.

For those of you living outside of Utah, EHLP is available in 27 states. Non-participating states have similar state-operated programs available. Click Here for information about EHLP agencies and state programs outside of Utah.

Did You Know...

AAA Fair Credit Foundation is now part of a new opportunity through Market America and Shop.Com that allows our supporters to help us generate donations in support of our community programs without spending any extra money. Simply use the Market America portal to complete your regular online shopping and Market America will donate a portion of their revenues to us! Click Here to get started now. Don't forget to bookmark the portal website for easy access each time you shop online.

The Wishing Well

Sammy Rabbit

Sammy Rabbit is a loveable, furry critter on a mission to help kids and families get into the habit of saving and making smart money choices. Created by the It's a Habit Company, the Sammy site is a fun, energetic, and kid-centered clearinghouse of products, games, activities, articles, and other resources all focused on the development of savvy financial skills. Parents, teachers, and kids alike will all find something to enjoy here. Click Here to meet Sammy and find great educational tools and resources for your family.

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