Don't Be a Victim of Identity Theft when Traveling! ATM and Debit Card Fraud: What Travelers Need to Know

According to FICO, 16 percent of all personal data breach victims in 2017 had a debit card number compromised.  This follows a record year in 2016 when there was a 70% jump in such fraud.

Categories of Personal Data Breach Victims in 2017

This is a big problem for travelers!  Why?  Many travelers use a debit card to routinely pay for items even internationally or they use their ATM card to acquire foreign currency! This form of identity theft can be avoided if you plan ahead. Here are some of the basics you should know:  If a fraudulent charge is made on your credit card, there’s no immediate financial hit while you get things sorted out — since credit card bills are paid later, no money actually leaves your hands and the laws protecting you are much clearer. But if thieves get a hold of your debit card or debit card number, they gain access to your entire bank account and everything in it.  There may be money that leaves your hands since cash is automatically taken out of your checking account. In this situation, you may have to fight to get your own money back — a process that’s taking longer and longer these days — that is, if you even do actually get any money back.  The laws protecting you for bank account fraud are not as consumer-friendly.

The Basic Protections and Consequences of Debit/ATM Card Fraud and Credit Card Fraud

The Electronic Fund Transfer Act (EFTA) and the Fair Credit Billing Act (FCBA) offer protection if your ATM, debit cards or credit cards are lost or stolen but the protection level is VERY different!

Debit card fraud

• Reporting before any unauthorized charges are made leads to zero liability
• If you report the card as lost or stolen within two business days, you won’t be responsible for more than $50 of unauthorized transactions.
• If someone makes unauthorized transactions with your debit card number, but your card or pin is not lost, you are not liable for those transactions if you report them within 60 days of your statement being sent to you.
• If someone uses your physical ATM or debit card without your permission (meaning it was stolen) and you report the fraudulent charges within 60 days after your statement is mailed to you, you could lose as much as, but no more than, $500.
• If someone uses your ATM or debit card without your permission and you don’t report it within 60 days after your statement is mailed to you, the potential damage is unlimited. You could lose all the money in that account, the unused portion of your maximum line of credit established for overdrafts, and even more.

Credit card fraud

• If your credit card number is stolen, but not the card, you are not liable for unauthorized use.
• If the actual card is stolen, you are liable for no more than $50 in authorized charges — as long as you report it to your card issuer. Some issuers won’t even charge you the $50.

How to Protect Your Cards and Account Information

For Credit and ATM or Debit Cards

• Don’t disclose your account number over the phone unless you initiate the call.
• Guard your account information. Never leave it out in the open or write it on an envelope.
• Keep a record of your account numbers, expiration dates, and the telephone numbers of each card issuer so you can report a loss quickly. Put the numbers for your card issuers in your travel documents and phone before you leave.  Include the international collect numbers also!
• Draw a line through blank spaces on charge or debit slips above the total so the amount can’t be changed.
• Don't sign a blank charge or debit slip.
• Tear up copies and save your receipts to check against your monthly statements.
• Cut up old cards — cutting through the account number — before you throw them away.
• Open your monthly statements promptly and compare them to your receipts. Report mistakes or discrepancies as soon as possible.
• Carry only the cards you'll need.
• Act quickly if your card is lost or stolen. 

For ATM or Debit Cards

• Don't carry your PIN in your wallet, purse, or pocket — or write it on your ATM or debit card. Commit it to memory.
• Never write your PIN on the outside of a deposit slip, an envelope, or other papers that could be lost or looked at.
• Check your account activity immediately once you are home, especially if you bank online. Compare the current balance and transactions on your statement to those you've recorded. Report any discrepancies to your card issuer immediately.
• Don't use a debit card for purchases unless absolutely necessary.  Pay with cash or a credit card.

Tip:

Use a security bag when traveling!  Our favorite is the Classic Messenger Bag from Travelon.  With RFID pocket, locking zippers, slash proof strap, it helps reduce security risks!

At Cash Machines

• Use ATM's that are at a bank, preferably inside the bank doors.  These are less likely to be manipulated by scammers.  If you are able, before you leave on your trip, look at your banking website to find partner bank ATM's near your hotel.
• Safeguard your PIN code. Memorize your PIN; you'd be surprised how many people foolishly write it on their card. (If you don't trust your memory, you can keep a clue to your code in your moneybelt and/or your phone — just be sure that your reminder is utterly inscrutable to a thief.) "Shoulder surfing" — a thief watching you as you type your PIN into a keypad — is worth being aware of. When entering your PIN, block other people's view of the keypad by covering it with your free hand.
• Inspect the ATM for card skimmers. Before inserting your card into a cash machine, inspect the front (especially if it's not inside a bank). If anything looks crooked, different colored, loose, or damaged — or if the entry to the card slot bulges out dramatically — it could be a sign of a card-skimming device.  PC Magazine has a great article on how to spot a skimmer.
• Beware of stuck cards. Keep an eye out for anything in the card slot that could trap your card (or in the cash dispenser that could trap the cash). If your debit card gets stuck in an ATM, do not re-enter your PIN. Thieves have been known to insert a thin loop of tape cleverly designed to trap your card in the slot, then promptly arrive on the scene posing as a Good Samaritan. They may advise you to retrieve it by retyping your PIN, or point to a sign recommending that you enter your PIN twice if there's trouble. In either case, someone is nearby watching you enter your code. Once you give up on getting your card to eject and leave the scene, the criminals collect it and use it.
• If your card or cash does get stuck, try to avoid leaving the machine. If you're traveling with a partner, have one person go inside the bank while the other one stands by the machine — if your card or cash has indeed been trapped, thieves won't wait long to retrieve it.
• Don't trust "helpful" strangers. Yes there are true helpful good Samaritans everywhere — but when it comes to troubles with your bank card, politely decline any offers of help.
• Also, pay attention to strangers loitering near a cash machine, especially if they're in pairs (most commonly, the first one distracts you; the second one grabs your cash). Remember that you're most vulnerable just after you have entered your PIN and the withdrawal amount. Be savvy about the many clever methods used to distract ATM-goers. For example, the scammer may pretend to sell you something, place money at your feet and tell you that you dropped some money, or ask you for a charitable donation. Sometimes the scammers are children trying to be cute.

The ATM pictured on the right below is shown with the card skimmer and video camera (upper left) attached. Click the image for a slightly larger look. (Courtesy Krebs on Security)

Avoid Trouble by Planning Ahead

• Exchange money before you leave home.  Most banks have mail order opportunities or large branches where you can make cash exchanges.  Call your bank and ask, because if you are a customer, the exchange rates are usually most generous for you.
• A credit card is always your best bet for purchases overseas, and make sure you notify your credit card companies before you leave the country if they require it.  Notice we said companies?  It is always smart to have more than one credit card in case merchants only accept certain types of credit cards overseas.  Still, it is very worthwhile to have some foreign currency on hand, and we recommend doing the currency exchange before you leave.
• Exchanging currency before you leave gives you more opportunities to shop around for the best rates and allows you to avoid the hassle of large exchange fees once you arrive and have limited options.  In addition, having your money ahead of time gives you more time to enjoy your destination!!!!
• How do you shop for currency exchanges? One excellent option is to contact the branches of large banks in the city you’re flying out of. Cities with a large international airports often have bank branches that will do an exchange for you, often at a low rate.
• You can convert dollars in your last domestic airport before departure.  This allows you to conceal the cash you have obtained from potential thieves, and limits hassles when you arrive and may be confused, tired and overwhelmed by immigration and customs checks.
• If you must use a debit card or ATM card while traveling, and travel frequently, consider asking your bank for a second account or debit/ATM card that is only used for traveling.  
• Use an RFID wallet or bag to protect your credit card and ATM card information and a few options from Amazon are listed below.