servicemen and women find it easy and convenient to use credit
cards and ATM or debit cards. The Fair Credit Billing Act (FCBA)
and the Electronic Fund Transfer Act (EFTA) offer procedures for
you to use if your cards are lost or stolen.
Limiting Your Financial Loss
loss or theft of your credit cards and your ATM or debit cards
to the card issuers as quickly as possible. Many companies have
toll-free numbers and 24-hour service to deal with such
emergencies. It's a good idea to follow up your phone calls with
a letter. Include your account number, when you noticed your
card was missing, and the date you first reported the loss.
may want to check your homeowner's insurance policy to see if it
covers your liability for card thefts. If not, some insurance
companies will allow you to change your policy to include this
Card Loss or Fraudulent Charges (FCBA). Your maximum liability
under federal law for unauthorized use of your credit card is
$50. If you report the loss before your credit cards are used,
the FCBA says the card issuer cannot hold you responsible for
any unauthorized charges. If a thief uses your cards before you
report them missing, the most you will owe for unauthorized
charges is $50 per card. Also, if the loss involves your credit
card number, but not the card itself, you have no liability for
loss, review your billing statements carefully. If they show any
unauthorized charges, it's best to send a letter to the card
issuer describing each questionable charge. Again, tell the card
issuer the date your card was lost or stolen, or when you first
noticed unauthorized charges, and when you first reported the
problem to them. Be sure to send the letter to the address
provided for billing errors. Do not send it with a payment or to
the address where you send your payments unless you are directed
to do so.
Debit Card Loss or Fraudulent Transfers (EFTA). Your liability
under federal law for unauthorized use of your ATM or debit card
depends on how quickly you report the loss. If you report an ATM
or debit card missing before it's used without your permission,
the EFTA says the card issuer cannot hold you responsible for
any unauthorized transfers. If unauthorized use occurs before
you report it, your liability under federal law depends on how
quickly you report the loss.
example, if you report the loss within two business days after
you realize your card is missing, you will not be responsible
for more than $50 for unauthorized use. However, if you don't
report the loss within two business days after you discover the
loss, you could lose up to $500 because of an unauthorized
transfer. You also risk unlimited loss if you fail to report an
unauthorized transfer within 60 days after your bank statement
containing unauthorized use is mailed to you. That means you
could lose all the money in your bank account and the unused
portion of your line of credit established for overdrafts.
However, for unauthorized transfers involving only your debit
card number (not the loss of the card), you are liable only for
transfers that occur after 60 days following the mailing of your
bank statement containing the unauthorized use and before you
report the loss.
unauthorized transfers show up on your bank statement, report
them to the card issuer as quickly as possible. Once you've
reported the loss of your ATM or debit card, you cannot be held
liable for additional unauthorized transfers that occur after
Protecting Your Cards
protections against card fraud are to know where your cards are
at all times and to keep them secure. For protection of ATM and
debit cards that involve a Personal Identification Number (PIN),
keep your PIN a secret. Don't use your address, birthdate, phone
or Social Security number as the PIN and do memorize the number.
following suggestions may help you protect your credit card and
your ATM or debit card accounts.
For Credit and ATM or Debit Cards:
cautious about disclosing your account number over the phone
unless you know you're dealing with a reputable company.
put your account number on the outside of an envelope or on a
- Draw a
line through blank spaces on charge or debit slips above the
total so the amount cannot be changed.
sign a blank charge or debit slip.
- Tear up
carbons and save your receipts to check against your monthly
- Cut up
old cards - cutting through the account number - before
disposing of them.
monthly statements promptly and compare them with your
receipts. Report mistakes or discrepancies as soon as possible
to the special address listed on your statement for inquiries.
Under the FCBA (credit cards) and the EFTA (ATM or debit
cards), the card issuer must investigate errors reported to
them within 60 days of the date your statement was mailed to
- Keep a
record - in a safe place separate from your cards - of your
account numbers, expiration dates, and the telephone numbers
of each card issuer so you can report a loss quickly.
only those cards that you anticipate you'll need.
For ATM or debit cards:
carry your PIN in your wallet or purse or write it on your ATM
or debit card.
write your PIN on the outside of a deposit slip, an envelope,
or other papers that could be easily lost or seen.
Carefully check ATM or debit card transactions before you
enter the PIN or before you sign the receipt; the funds for
this item will be fairly quickly transferred out of your
checking or other deposit account.
Periodically check your account activity. This is particularly
important if you bank online. Compare the current balance and
recent withdrawals or transfers to those you've recorded,
including your current ATM and debit card withdrawals and
purchases and your recent checks. If you notice transactions
you didn't make, or if your balance has dropped suddenly
without activity by you, immediately report the problem to
your card issuer. Someone may have co-opted your account
information to commit fraud.
Buying a Registration Service
annual fee, companies will notify the issuers of your credit
card and your ATM or debit card accounts if your card is lost or
stolen. This service allows you to make only one phone call to
report all card losses rather than calling individual issuers.
Most services also will request replacement cards on your
a card registration service may be convenient, but it's not
required. The FCBA and the EFTA give you the right to contact
your card issuers directly in the event of a loss or suspected
decide to buy a registration service, compare offers. Carefully
read the contract to determine the company's obligations and
your liability. For example, will the company reimburse you if
it fails to notify card issuers promptly once you've called in
the loss to the service? If not, you could be liable for
unauthorized charges or transfers.
(Source: Federal Trade Commission)