Consumer expert: Don’t use debit cards following Target breach

The card named the worst to use as a checking account alternative is the Account Now Visa Classic. The report says the average user of this card will pay about $30 a month in fees. (AP)
Protecting your money after data breaches

wtopstaff | November 14, 2014 11:54 pm

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WASHINGTON – Target’s security breach has shoppers on edge, especially after a report says it was part of a broader scam that could have affected more retailers — but one expert says consumers can still protect themselves.

Consumer expert Clark Howard says avoiding debit cards is one line of defense for those who fall victim to a breach. If hackers get a debit card, the money comes directly out of a checking account and it is more difficult to recover, Howard says.

“If a criminal compromises your debit card number and starts using it, your money disappears,” Howard said in an interview with WTOP.

“Your rights under federal law are pathetic with debit cards — not anywhere near like where they are with credit cards.”

Victims who have their debit card information stolen have to fight with a bank or credit union to get their own money back, Howard says.

With credit cards, however, the money has never been taken out of an account and all it takes is a conversation with the credit card company to sort it out, he adds.

Another defense is credit freezing, which locks a consumer’s data until an individual allows for a release. It means no one can apply for credit pretending to be you, Howard says.

“A credit freeze is very important because a lot of times it’s the account takeovers and the identity theft we aren’t aware of until after it’s caused a lot of havoc and damage,” Howard says.

Credit freezes allow consumers to seal credit reports and use a personal identification number to “thaw” the credit so legitimate applications for credit and services can be processed.

For more information about how to do a credit freeze, visit Howard’s website.

Follow @WTOP on Twitter.

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