A former employee of the Clayton Animal Hospital in North Carolina was arrested recently and charged with stealing the credit card numbers of hospital clients and using these numbers to make online purchases. This is important to you regardless of whether you are a client of the Clayton Animal Hospital or not because it points out our vulnerability to credit card fraud when either rogue employees or hackers manage to steal credit card information. This case also serves as an important reminder to us all to use our credit cards rather than our debit cards when doing retail purchases. Your potential liability is far worse when your debit card information is stolen than when your credit card number is stolen. The holder of a credit card used for fraudulent purposes cannot be assessed more than $50 for such use and most credit card companies charge nothing. However, the potential liability of a person whose debit card has been compromised can reach his or her entire bank account tied to the card if the card owner does not report the crime promptly and even if the card owner does report the theft promptly, the debit card owner’s access to his or her own bank account is frozen while the bank investigates the crime.This case further points out the value of EMV chip credit cards. If the Clayton Animal Hospital had used the EMV chip card, the employee would not have had access to the credit card number.
According to statistics of FICO, the company that created the credit scoring system used by banks and others to measure credit worthiness, debit card fraud increased by 26% between 2015 and 2016 and my belief is that the problem is going to get worse before it gets better.   A large part of the problem has been the failure of many companies to switch over to the more secure EMV chip credit and debit cards as required by industry guidelines that do not carry the weight of law.  While the date for retailers and ATMs to switch to EMV chip credit and debit cards has long passed, the date for gas pumps to implement EMV chip credit and debt card technology has been extended until 2020. This gives identity thieves plenty of opportunities to install cheap and easy to obtain skimmers on ATMs, gas pumps and the card processing equipment of non-complying retailers to steal credit and debit card numbers to be used for fraudulent purposes.
Consumers should refrain from using their debit cards for anything other than an ATM card. Use a credit card for all of your card purchases to achieve greater consumer protection and shop with businesses that use the EMV chip whenever possible for further protection.  In addition, you should regularly monitor the bank account tied to your debit card in order to discover as soon as possible if fraudulent use of your debit card has occurred so that you can report it to the bank and limit your liability.
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