March is fraud prevention month and, right on cue, Jonathon Chevreau became the unwilling advocate of the cause by becoming a victim of debit card fraud. His story sounds a lot like mine several years ago when there was an unauthorized withdrawal from an ATM in the middle of the night. Since the reports of fraud are on the rise, whether it be identity theft, debit card fraud or credit card fraud, there’s a whole host of new products and technologies to prevent fraud.
But here is the crux of the issue. Last week, I received one of these new chip bank cards which are supposed to decrease the incidents of fraud. One problem- my bank mailed me my top of the line anti-fraud debit card by regular mail with a “important document enclosed” notation in bold on the front of the envelope. Even worse, I did not have to dial a number to activate the card; all I had to do was sign the back of the card.
You can fight high technology fraud with high tech devices but it is the simple things that makes fraud easy. Mailing a debit card by regular mail is tantamount to buying the greatest home security system on earth and forgetting to lock the front door. Stealing mail is often the first step in identity theft- made easier by telling the would be thieves that there are important documents inside.
(…and once upon a time, my bank used to courier credit cards to the local postal office for me to pick up. This is classic Dilbert-esque corporate decision making- spend a load of money on the sexy stuff and cheap out on the important things.)
As a lawyer, you hear about too many tales of good people becoming victims of fraud. But they are not victims due to some elaborate, high tech scheme. Committing fraud can be quite low tech and there are some equally low-tech and common sense ways to prevent fraud.
- Check your mail daily. Easiest way to commit identity theft is to steal someone else’s mail. Yet, I am always appalled by how long it takes for people to pick up their mail.
- Check your bank account daily. First and foremost, you will pick up unusual activity. Secondly, if you fail to report a fraudulent transaction in a timely manner, the bank may not reimburse you if you are a victim of debit card of identity theft (read the first comment from the regulator- absolute great examples and lessons to be learned; nothing really complicated too). As a side note, I find that checking my bank account daily helps in curbing spending. There is something about watching a dwindling bank account that acts as a brake to consumption.
- Always wrap your cheques in paper/buy thick envelopes. Thin envelopes allow you to see a cheque and someone can take your cheque and alter it. Cheque washing, the process of re-writing cheques, is often not caught when the amounts are small and processed through ATMs.
- Bad social media practices = invitation to rob you (literally). As Weakonomics explains, certain social media applications are invitations to the world to rob you; Please Rob Me may be my favorite social commentary site of the year, exposing the downside with our endless fascination of telling the world about our most intimate details 24-7 (they have taken down the Twitter feeds which matched people announcing to the world they left their house to their actual home address). More to the point, social media over-share is now used by unscrupulous characters to guess your passwords (if you give birthdays, family member names, pet names etc.) and identity theft. Do NOT rely on the privacy settings. Social media sites can be buggy and not always work properly. The rule should be to provide as little as possible on social media.
- If you think you are a victim of fraud tell someone and be proactive. Call the cellphone company and lock your phone if it is stolen. Tell your bank branch manager if you think someone saw your pin at the local ATM. Call the credit bureau if you are a victim of identity theft. Be cautious and be prudent. As the above noted, being proactive also increases your chances of a quicker recovery.
At the end of the day, if some high tech fraud artist is using absolute cutting edge technology to hack your computer or replicate your credit card, they will. There is no real preventive measure to a really skilled and determined theft other than living off the grind entirely. The point is not that one can be 100% fraud proof but to eliminate the low-hanging fruit opportunities by using common sense and being proactive. Good luck.
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