Protect Yourself from Data Breaches

Data breaches are becoming far too common. And there is no single law that requires a company to tell their customers when, or if, such a data breach has occurred. As a result companies often pick and choose what laws to obey and which to ignore. Stores, banks and other services where you use your credit card often practice protecting themselves first before they consider your interests. In addition many of these companies are also deciding to pay off a claim of fraud rather than fix security issues in their systems. Its simply cheaper to pay you than invest money in more secure systems. Its the sad state of e-commerce security.

As a result black people and all consumers need to protect themselves when shopping online or in the brick and mortar stores.

Here are a few steps I’d advise the African-American consumers to take to protect your financial information and assets.

1) Monitor your bank accounts, daily!  There is no easier way to spot fraudulent charges than to pay careful attention to you bank account and your credit and debit card statement. My recommendation is that you check you accounts each evening. Its funny but a lot of people are watching television with their tablets or laptops. Use a few minutes to check those accounts. And change passwords, correction, pass phrases, frequently, like every six months. See something fishy?  Call your bank or card provider immediately.

2) Use a credit card, not a debit card.Why? Because government regulations protect you from fraudulent charges over $50 and most liability.  Use your credit card or a debit card with a signature, not a pin number. The regulations are not so clear when using a debit card with a pin and as a result you may end up on the hook for fraudulent charges.

“The best tip to avoid problems on your existing accounts is not to use debit cards, because not only is the credit card law better, but your own money is not at risk with a credit card,” says Ed Mierzwinski, consumer program director at the U.S. Public Interest Research Group.

3. Make use of free credit monitoring.  Whenever a data breach happens, and the word gets out, then a lot of financial institutions will offer credit monitoring to those customers affected. Its really not much but its something.  And you don’t have to pay anyone for your credit report. The government offers three free credit checks a year. Black people should take full advantage of this service. Your credit report will reveal if any loans or new credit cards have  your name on them. If you see something act immediately. It likely means your identity has been compromised. Get you free credit report here: https://www.annualcreditreport.com/index.action

4) Make use of your banks security services. Many banks offer email alerts when a charge shows up on your account, especially major purchases. These can help protect you from identity theft. Some credit monitoring service will alert you when someone applies for credit in your name as well.  Be careful about online money transfers and online bill paying. Use a check and drop it in the mail.  Paper is indeed much more secure. And don’t use the same password for your bank that you use on Facebook or other websites.  Social media and other non-financial websites are easier to hack.

5) Don’t depend on the banks or credit companies to protect you. You are an after thought after they protect themselves.  Vendini is an online ticket seller that reported a data breach. Just this past Friday the company settled a rare class-action lawsuit about compromised data. Rare because the courts usually throw out cases where no actual damages are proven. Vendini will pay affected customers up to $3,000 for identity theft losses. But as I said, unless the customer can prove actual damages from the data loss the money may be out of reach. The lesson here is don’t expect companies to tell you if your data has been stolen. There is no law that says they have to tell, at least not right away. Its up to you to cover your own ass. 

Now you know.