Credit or Debit?

Traditional advice would suggest to avoid using Credit Cards because of the potential to overspend. BUT there is DANGER in using Debit Cards. The next time you are asked "Debit or credit?" at the checkout, use your credit card. The law limits your liability to $50 if a credit card is stolen, but you could lose much more if you report debit card theft.

Fair Credit Billing Act
This federal act limits the liability of a credit card holder to a maximum of $50 for any unauthorized transaction -- whether or not your card was actually stolen. Someone may have been able to access your account without the card.

Electronic Fund Transfer Act
This limits the liability of a debit card holder to a maximum of $50 if you notify the bank about a lost card within two days and up to $500 if the bank's notified after two days. After 60 days, there is potentially unlimited liability on the debit cardholder.

If someone makes an unauthorized transaction without obtaining the debit card, you could be liable for all transactions made after 60 days of receiving your bank statement and before you tell the bank.

Proactive measures to limit liability for unauthorized transactions:

• watch your checking account balance
• check your statements
• call the bank immediately to report a lost or stolen debit card, or notify the bank of an unauthorized transaction

Shoppers must be made aware of ways to safeguard personal information and their money.

Not annually.

Not monthly.

But weekly, if not daily.

Besides switching from debit to credit cards, I suggest the regular check of accounts and your credit report. Using the credit card option on your debit card, is not safe, either. It is a non-PIN option to using money in your account.

Companies are sloppy with information. People need to be aware that companies are not protecting their information.

Your credit card is their money, but your debit card is your hard earned money!!!

Consumers should find out their bank's written policy on liability for unauthorized transactions if they use a debit card. Although a number of banks limit liability to $50 or less for fraud, a thief can drain your account, and if a conflict with the bank arises, no law requires that you see any of that money again.

Tax Time TIPS

A majority of Americans will finish filing their taxes this weekend. I wanted to give you a few reminders to help you keep your information safe.

It is important that you are aware that most photocopiers produced in the last five years contain hard disk drives that keep a picture of every document copied over a historical period. This means that someone else can gain access to any document you photocopy. Most of these copiers don't include security software and encryption to protect or adequately erase data that is no longer needed.

The biggest threat comes from the companies that service photocopiers (you know, the ones who fraudulently call you and try to get you to order new toner or service your machine?). When repairing a photocopier, most any competent technician will know how to run a copy of all historical documents. Tax documents are particularly vulnerable because of all of the private information they contain.

There are several solutions:

1. Photocopy documents on a photocopier that has no hard drive
2. Photocopy documents on a copier that you own and can frequently erase the hard drive
3. Ask the company copying for you (e.g., Kinkos) if they maintain an image of your photocopy and how often they erase the drive (CHOP for those of you who have seen me speak)
4. Make sure you ask your CPA, Bookkeeper, Lawyer and Broker about their photocopy machines. Most of them probably don't even know that it is becoming a problem
5. Make sure you mail your tax return via USPS Registered Mail with Return Receipt in order to provide an extra level of security. Drop your filing off inside of the post office; never use the blue USPS boxes to mail sensitive documents (many of them get picked up at night by ID thieves and replaced by morning) and don't send it from your home or the office.
6. When you are done filing, store the documents in a locked filing cabinet or fire safe. You protect yourself against fire and theft at the same time.
7. Don't forget that it is also tax scam season. Ignore all faxes and emails that appear to be from the IRS. They are NOT FROM THE IRS, but are trying to get your private information from you. If you receive one of these faxes or emails, contact the IRS at phishing@irs.gov.

Sounds Familiar

An article was just published in the American Bar Association Journal.

'Where Theres a Will'

The article details how a lawyer has come up with a 'new concept' of having home parties for estate planning packages. This concept sounds familiar. Can you say Pre-Paid Legal?

Included in this attorneys estate planning package is a basic will, healthcare proxy, and a durable power of attorney. For this, the attorney gives a $25 discount off his normal feee of ONLY $500.

ONLY $500 for what PPL does (and a PPL Legal Plan does a whole lot more) for $17 per month.

"But Haroutunian thinks his take on the Tupper­ware party could be just as big. He’s contemplating creating a franchise for the will-signing party, and he thinks there will be no shortage of takers. In fact, just the other day, he says, an Ohio attorney who got wind of the idea called him to learn more. "

Seize the opportunity you have before you.

Privacy Advocate Pushes to Protect Data in Public Records

April 09, 2007 (Computerworld) For nearly five years, Betty “BJ” Ostergren — a feisty 57-year-old former insurance claims supervisor — has led a one-person crusade to persuade county and state government officials to stop posting public records containing Social Security numbers and other personal data on their Web sites.

Last month, Ostergren persuaded the secretaries of state in Colorado and Arizona to break links to some commercial and tax lien documents. And last week, she began putting public pressure on Massachusetts Secretary of State William Galvin to do the same thing.

Ostergren, who lives in Virginia, spoke with Computerworld about her privacy campaign last week.

Excerpts follow:
Are there many counties around the U.S. that are still posting public records with personal data?
Yes, there are. It’s stupid, it’s reckless, and it’s dangerous. Here’s a thought: If somebody wants to see a public record, why don’t they get in their car and drive down to the courthouse or the secretary of state’s office? Don’t be spoon-feeding criminals with stuff on the Internet. County clerks say all they’re doing is making the same records that are available in the courthouse available online.

What’s wrong with that?
Sure, these are open records at the courthouse, as well they should be. But when we first started putting our records in these courthouses hundreds of years ago, it was for safekeeping and for different legal purposes. With the advent of the Internet, everybody wants to put all this crap online, and I just think that it’s dead wrong.

So who do you think is accessing the data?
Absolutely anybody and everybody can access it. People from outside this country are into these sites, and so are people from within this country. Maybe it’s your neighbor down the street. A site like the Colorado secretary of state’s is free and open. Anybody can just simply sign up and get a password, and in a minute you can get right in.

But some states and counties require you to pay for the records, right?
A subscription is no protection. In Virginia, for $25 you can sign up to access [the Web site of] Fairfax County. I send in $25 and I get a password and a username back in three days or so, and then I’m in there sitting on 33 million records and about 5 million Social Security numbers. That’s where you lose control of those records. There are people downloading them by the gazillions.

Industry of Ignorance or Greed?

I have stated in my book as well as my lectures and seminars that in my opinion identity theft “insurance” or a “monitoring service” that is proactive as well as reactive will be a must in everyone’s insurance portfolio within three to five years.

You do not have to like this, it is a matter of necessity.

Ask yourself, when is the last time you have made a claim under your auto insurance? What about your home owners insurance? Then why do most of you carry it? It is the same reason you will start to carry identity theft insurance.

The problem with insurance products on the market today is they are not robust enough. Until someone starts to listen to the masses and builds a product for the good of the people instead of for corporate greed the individual will continue to lose.

I am convinced the insurance industry is to lazy and greedy to do the research needed to build a product that will have some real teeth. I am also convinced that the congress is to lazy, greedy and worried about being re-elected to make any "real" changes to the law that, god forbid, is on the side of the public instead of "corporate america." I want to assure the insurance industry, if you get your head out of the sand and realize what opportunity you have in front of you there is a lot of money to be made, while truly fulfilling your client's needs.

In a meeting, roughly one year ago, I attended with a large company that provides an identity theft protection product, I voiced my concern with their product and the lack of “true” proactive coverage and the false sense of security the consumer was getting from it. The answer I received from their managers was flabbergasting. They said their product was … (Another Post for another Time) Even I was shocked.

This is not a local, state, regional, or national issue, this is a global issue that can and will cause financial destruction on a global scale. This global issue will soon become an epidemic if unchecked as the below article from South Africa demonstrates.

In an article written by Nabelah Adams on 15 March 2007 for BusinessOwner.Co.ZA, Nabelah quotes Caroline Buthelezi of the Credit Information Ombud’s Office of South Africa as stating, “Clearing one’s name involves a great deal of effort as many people only discover the consequences of not reporting their ID book stolen when the credit bureau has already handed the matter over to their lawyers.”

“The consequences of ID theft might be even more exacerbated by the fact that attempts to have matters resolved are complicated by having to deal with attorneys,” Buthelezi says.

This is of course if you can afford to hire an attorney.

© 2007 Michael R. McCoy