BOTTOM OF PAGE: The DANGEROUS DECEPTION of CHECKING DEBIT CARDS

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ADDENUM July 14, 2006

CHECK YOUR CHECKING STATEMENT!!!!

You can get ripped off directly and not even know it.

I just discovered two debits DIRECTLY out of my Checking Account- fraudulent withdrawals, paid to Sears, two separate dates.

I did not make any purchase at Sears on these dates.

What happened? I did a Google Search- "unauthorized withdrawal from Sears" and came up with another person having the same experience. Someone else was paying off their Sears charge account by fraudulently using another persons Checking Card number.

!!

Looks like the same thing happened to me.

I will have to go to my bank, stop my Checking Card number, and perhaps even close my checking account. Sears knows NOTHING about it- so they claim.

This is also from another web page;

"Debit card thieves get around PIN obstacle"

Debit card thieves get around PIN obstacle
Wave of ATM fraud indicates criminals have upped the ante
With consumers around the country reporting mysterious fraudulent account withdrawals, and multiple banks announcing problems with stolen account information, it appears thieves have unleashed a powerful new way to steal money from cash machines.

Criminals have stolen bank account data from a third-party company, several banks have said, and then used the data to steal money from related accounts using counterfeit cards at ATM machines.

The central question surrounding the new wave of crime is this: How did the thieves managed to foil the PIN code system designed to fend off such crimes? Investigators are considering the possibility that criminals have stolen PIN codes from a retailer, MSNBC has learned.

The incident calls into question the security of the four-digit code that for years has made PIN-based transactions less subject to fraud than signature-based credit card transactions.

"This is the absolute worst hack that has happened, the biggest scam to date," said Gartner analyst Avivah Litan.

In recent weeks, Bank of America, Wells Fargo, Washington Mutual and Citibank have all reissued debit cards after detecting fraudulent activity. Smaller banks, such as Ohio-based National City Bank and Pennsylvania-based PNC Bank, have taken similar steps.

Consumers complain around the country
In the meantime, complaints from consumers who say thousands of dollars has gone from their accounts continue to multiply. Police in Erie, Pa., say they've taken reports from dozens of residents. There are more than 100 reports of fraud in Las Cruces, N.M. In Western Massachusetts, after mounting complaints, including 147 compromised accounts at the Fitchburg Municipal Employees Federal Credit Union, the state Consumer Affairs Office issued a warning about debit card fraud.

The tales of theft are consistent and disturbing.

"Last week, I was online paying some bills and noticed several ATM transactions from Toronto, Blainville ...," wrote Dana Lark of Naples, Fla., to MSNBC.com. "By the time I called my bank and reported the problem, they had gotten $1,300 of my money. I told my husband to check his business account, which has an ATM card tied to it, and he found over $1,500 of unauthorized charges from those same places and also Bulgaria."

Financial institutions around the country continue to issue warnings, the most recent this week by Citibank, which said it had spotted fraudulent withdrawals from U.S. accounts made in Canada, the United Kingdom and Russia.

In each case, the banks have blamed a third-party company ? in some cases, more specifically identified as a merchant or retailer. Speculation has been rampant that the source of the stolen data is office supply store OfficeMax, starting with an article last month in the San Francisco Chronicle indicating 200,000 account numbers had been stolen from the firm. OfficeMax denies it's to blame.

The Secret Service is investigating the incidents, said spokesman Eric Zahren. He stressed that the agency is studying potential data leaks "that involve a number of retailers."

Why debit cards and PINs are now targeted
But the key question surrounding the attack is this: How did the thieves get the PIN codes they needed to perform ATM withdrawals?

It's typical for thieves to take credit card numbers and attempt purchases ? but that's risky business. It takes effort to turn stolen merchandise into money. Debit card account information, combined with PIN codes, make a much better mark. Criminals can just go to ATMs anywhere in the world and walk away with cash. They don't even have to interact with store cashiers, making so-called "white card" fraud ? creation of counterfeit cards, often plain white, loaded with stolen data ? easy.

But getting consumer PINs has always been a hurdle. At times, criminals have resorted to drastic measures such as using miniature cameras or other technologies to steal PINs one at a time. But the sheer number of stolen accounts linked to the latest data theft suggests there must be another method.

On Thursday, Litan will release a report indicating she believes the PIN information was stolen in bulk, at the same time the account information was stolen.

Stealing PINs sharply ups the ante in the cat-and-mouse games between criminals and banks.

Litan says many merchants incorrectly store PIN information they should be destroying after customers enter the secret code on PIN pads in stores around the country. While the information is often encrypted into something called a PIN block, the keys necessary to decrypt the information are often stored on the same network, she said. That makes stealing the PINs as easy as breaking into an office computer using a password a careless employee has taped to the screen.

"Once the thieves have a cardholder's PIN, they have enough data to create and use counterfeit cards to withdraw cash at ATM machines," Litan said. In her report, she says careless PIN storage by retailers is to blame for the recent spate of ATM fraud, including Citibank's troubles.

?But in defense of (the retailer), it?s just using payment software and probably doesn't even know what's in there,? she said. ?The software is storing PINS just because it can. No one is paying attention to this stuff, it's deep in the software.?

Surprise: Merchants keep your PIN
None of the banks involved would discuss how the criminals managed to get customer PINs. But a researcher familiar with the investigation, who asked for anonymity because he said he wasn't authorized to speak publicly, confirmed that Litan's description is the operating theory on the recent rash of debit card fraud.

Several banks have made clear in their announcements that PINs were stolen and used to make fraudulent withdrawals. In its announcement this week, Citibank said specifically it had locked out suspect cards from PIN-based transactions, after there were "several hundred fraudulent cash withdrawals" in Canada, the United Kingdom and Russia.

Consumers might be surprised to learn that their PIN numbers are stored by merchants they shop at, and can be stolen from merchants by hackers.

While storing PINs is against network rules, many retailers inadvertently store the information, said Mike Urban, who runs Fair Isaac Inc.'s ATM fraud detection program called CardAlert. It ends up accidentally saved in temporary files and other software nooks and crannies.

"There are so many places along the transaction that the numbers can be," he said.

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Those nooks and crannies worry Urban, who like Litan, thinks PIN theft ? leading to cash machine withdrawals ? is the next major trend in fraud.

"There's a shift going on in fraud," he said. "(Criminals) are moving to where the cash is, and moving away from credit.?

Urban confirmed that his company is investigating "several large compromises of cards and PIN data." The number of compromised accounts could easily reach six figures, he said.

For consumers: Avoid the PIN pad
Litan says consumers concerned about the scam should avoid PIN-based retail transactions, and chose instead to make signature-based, credit-card-style transactions when making purchases with debit or check cards at stores. That means pushing away the PIN pad and signing a receipt instead. Doing so will limit the number of computer systems where a PIN may end up in storage.

"There are so many point-of-sale terminals everywhere, it's hard to know how safe they are," she said. A sloppy retailer, or a sloppy software provider, could end up leaking the PIN to a criminal. There is no reason for added scrutiny of bank ATM machines, Litan said, which tend to have far stricter security standards.

Debit card theft can be far more severe than credit card theft for consumers. For starters, different consumer protections apply. Account holders are liable for only up to $50 of credit card fraud ? but consumers can be liable for the entire balance of their bank account after debit card fraud, according to federal banking regulations. Many banks voluntarily extend credit card-style protection to debit cards, but they are not required to do so.

Moreover, debit/check/ATM card fraud means money is instantly missing from the consumer's account. That can lead to bounced checks and other hassles. In credit card fraud, consumers generally never lose the money and simply don't pay the bill for the fraud.

Also, while most consumers have multiple credit cards, many only have one cash/debit card. If the account is suspended, they may not have access to the cash in their primary checking or savings account.

Bob Sullivan is author of Your Evil Twin: Behind the Identity Theft Epidemic
http://www.msnbc.msn.com/id/11731365/

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You are likely being ripped off and overcharged for services that every person should be screaming about. Yet, we have become as placid as cows and sheep going to slaughter.

If you are like most Americans, the logical part of your brain in the financial section of your neural networks is DORMANT and ASLEEP.

Think about this for a second- Your bank LOVES it when you make banking errors because every mistake you make results in fees for which you are charged. It's additional money the bank takes from you, at great profit to the bank; Millions upon millions of dollars of additional profit for the banking industry.

Further, most Americans use banking services that increase the likely hood that they will make checking account and saving account errors. Often, we also pay additionally for these services.

When you get ripped off by manipulative banking advertising and practice, your brain is unhappy. Fight back with

WHOLE BRAIN BANKING INTELLIGENCE.  

Our story begins here.....

The biggest news these days in banking is 

McBanking

Banks are modeling themselves after the McDonalds Chains of fast food restaurants, first by offering branch banking on every corner. This is an attractive way to get customers- simply by being in customer's faces at every turn, the bank gives the illusion of being a NEIGHBOR, and community friend. Omnipresence with nice shiny stores. "We are everywhere you are, and we are good neighbors." 

That's the first hook.

Once inside the bank, they sell their services: MODERN MONEY CONVENIENCES like

ONLINE BANKING and BILLPAY and VISA Check Cards and ATM Cards are just like the junk food you see on a fast food restaurant menu.  Look at all those greasy GOODIES! Yummy!

Here is where the big corporate lie begins.

The LIE is that NONE OF THESE SERVICES take the place of simply and dependably keeping track of your expenses and deposits  in either a plain written register or in decent computer software.

Read this FACT again until it is BURNED INTO YOUR BRAIN:

ONLINE BANKING and BILLPAY and VISA Check Cards and ATM Cards  just like the junk food you see on a fast food restaurant menu.

The LIE is that NONE OF THESE SERVICES take the place of keeping track of your expenses and deposits  in either a plain written register or in decent computer software. 

None of these services are in the end as simple and as dependable as keeping sufficient cash in your pocket for smaller planned purchases, using a credit card for larger purchases, and writing checks when necessary and keeping an ongoing log in a register or computer software. 

You will never be told this by a banker selling you their "convenient banking features", because knowing this one fact will reduce or eliminate your tendency towards using their "convenience features" which are laden with possibilities for error. Stop using the bank's junk services, and you will reduce profits for the bank. "Quiet....shhhhhhhhhh!"

They are most interested, above all, in getting you to take the bait and bite the 

McBanking Burger.

You wouldn't know it from the 8 FOOT HIGH billboard inside the bank telling you that "ONLINE BANKING LETS YOU DO ALL YOUR BANKING CONVENIENTLY and ACCURATELY". 

This is a Total misleading lie.

It fools millions of people every year who think online banking is a great invention and convenience.

You cannot rely on Online Banking for FULL and accurate account information. It is incomplete, and will never show outstanding payments you have made, and thus can be devastatingly inaccurate and can lead to horrendous overdrafts.

The same can be said of Auto pay and Bill Pay services which require additional yet absolutely necessary efforts in record keeping.

Similar services promise to make your banking "convenient and easy" as well.

All of these modern "conveniences" also make it MUCH MORE LIKELY and CONVENIENT THAT YOU WILL MAKE A BANKING ERROR.

Another example: FREE ATM CARDS!!!  FREE CHECKING CARDS!!!

The bank will issue you a "fake" Visa checking debit card, allow you to pay for an item, then delay "posting" the item several days, and if a conflicting check posts the same "postponed posting" day (often 3 or more days later), you will be charged if you go over your balance, even though you used the card on a day you actually had money in your account. Yep.

Use the card like an ATM card, and many banks will charge you an additional fee in addition to your purchase.

And who on earth keeps a written record of every ATM withdrawal or debit card purchase?  Too easy to miss, even when you don't mean to.

The banks have made every conceivable way possible for you to "get" money out of the bank- at least temporarily. But they have not increase one method of keeping accurate track of your actual finances- i.e. a up to date true and accurate written record of everything you have spent. So, they have made it so many more ways possible for you to make an error, and thus generate INSUFFICIENT FUND PENALTIES.

Yea banks!!

They are also VERY happy to cover a limited number of your overdrawn written checks. Gee, AREN'T THEY NICE?  Oh yeah, they make an extra $33 every time they do this. And if you don't pay them back they will ruin your life and hound you in every possible way until you ante up.

The Banks know all of this. They are VERY aware.

They also know that they are not at risk when you make a simple error.

But they know how profitable it will be for the bank.

Do you think for a second that banks would issue such cards and services if it did not meet their primary criteria: i.e. make more profit for the bank at little or no risk to the bank?

HOWEVER NOTE:

The bank NEVER pays for misleading the customers about the limitations and error prone methods they sell as conveniences available to customers. 

If a customer makes a mistake- it can CASCADE into a waterfall of fees, that is impossible to stop before it's too late. Just do a Google search and see what people are going through. Ask your neighbor.

Banks make MILLIONS and TENS of MILLIONS of dollars in this way on penalty charges when you use their convenience services instead of keeping a simple register.

One check that bounces, can cause a high overdraft fee, which then causes more overdrafts, which generate more fees, which generate more overdrafts ETC ETC ETC ETC.

Before you can get caught up, you may have had HUNDREDS of dollars subtracted from your bank account, and you will have to pay all of this off, and the bank will NEVER reverse these fees. Plead as you will. "I'm sorry," the bank will tell you, "But we don't reverse the fees unless it's a bank error."

It's one of the ways banks are racking in RECORD profits from unwary customers who have made errors- lured into Online Banking, Auto Pay, Bill Pay.

We accept this, just like we've accepted the low quality of service we get everywhere from corporate big business.

All of the banking "services" being offered are not for the customer's convenience- it's for higher profits in the banking industry. The more automated your banking, the less the bank has to do, and the less people they need to have on staff, and the more profit they make-- which ultimately result in higher corporate stock prices on the stock market.

Actual personal service is not cost effective.

Instead, customers are offered THE ILLUSION of SERVICE 

which is nothing more than cheap ass wholesale bulk electronic processing and all the limitations of such. This is NOT real human services or human concern. Its JUNK.

The tellers and other low rung bank employees are not any better off than the typical customer as they make just above minimum wage as they have their benefits cut each year. 

The top CEOs rake it in as they drive to the country club in their new Porsche.

Yes, this sounds negative. I am sorry.

But the human brain has not changed much since we first crawled out of the mud. It's still the dog eat dog reptilian part of our brain that runs much of our modern culture.

Better honest that head in the sand ostrich with an empty pocketbook.

ALL of the corporate banks are the same. Some are worse than others. But they are all bad in the way that they manipulate customers, and overcharge extravagantly with penalties approved by their friends in congress.

All big banks have friendly looking marketing and ads with pretty girls and big smiles kissing handsome guys, maybe some rustic stage coach logos and horses, and warm friendly faces to fool you into thinking they are down home people. Romantic Banking.

Banks have done a great job in presenting themselves as YOUR BEST FRIEND.

Bankers are not doctors, artists, musicians, teachers, bus drivers, or public workers.

Bankers are not even the tellers behind the counter.

Don't be fooled. Banks have one thing on their mind. 

Money. Money money money money money money money money.

Making PROFIT at your expense and risk.

Watch out.

THE FAIR MONEY

SOLUTION FOR YOU:

GOOD GREEN ENERGY FLOW

Concentrate on moving your green energy with YOUR REAL FRIENDS who actually care about you and who's business structure allows them to actually and truly COOPERATE with you. This is advanced frontal lobes interpersonal relationships.

We are more and more losing touch with PERSON TO PERSON individual recognition, especially when we do business with big corporate entities.

The days of dealing with an individual person when we buy and sell things we use in life are quickly disappearing with each passing day.

Those who hold on to this way of social/business interacting are being FORCED out of business-- the small stores that are run out of town and driven out of business by Wal-Mart, who offers cheap prices as they underpay their workers and but the cheapest goods on the planet made by virtual slave labor in Asia.

We are being fooled, and cutting our own throats because we are failing to value PEOPLE and PERSONAL CARE and REAL ATTENTION. By shopping only at BIG BOX STORES we are choosing to put smaller private business who can personally attend to our REAL needs out of business.

How much do you value YOU? And you as an individual? What are you willing to pay for Personal real service and care?

This can be on the INTERNET, on the PHONE, or in PERSON.

What matters is someone is actually listening to you, and understanding and looking after your welfare. Not just how much money they can squeeze out of  you.

As the economy gets worse, we have to pinch pennies. The cost of gas, utilities, and other rising costs forces us to shop at parking lot sized merchants, because we can not afford to keep shopping at the corner grocery store.


Your dollar buys a fraction of the standard of living it did 20 years ago. It will buy less tomorrow.


We have come to accept the way in which these hugely profitable businesses have manipulated the market and our behavior in the marketplace. These corporations have invented and delivered services and goods that we not only desire, but somehow feel we MUST have.

Do we?

Simple Money Brain Solution-   A MORE EFFICIENT WAY TO HANDLE MONEY:

1) Do business with a REAL PERSON who KNOWS YOU and CARES about you and can actually CONTROL how your money is taken and used, as opposed to a mindless and powerless worker bee than can only do the LAW according to the Corporate Queen Bee.

Buy at your corner market, at your corner hardware store, at your FRIEND'S place. Pay a few cents extra to deal with a REAL HUMAN with frontal lobes energy exchange- not just reptilian grab and go.

2) Take your banking business to your local credit union (or smaller neighborhood bank)-- where the rates are better, and YOU and other members OWN THE BANK. You will get better treatment, better fees, and better service when you really need it. At least if  you pay a penalty, it will feed the people who own the bank- YOU, the credit union member- rather than an overpaid billionaire corporate bank executive and their stock holders.

I recently moved all of my money out of the stinking Wells Fargo bank where there were constant teller waiting lines, and higher fees- to the smaller Liberty Savings Bank right across the street, where there is NEVER a line to wait to see the teller. The fees are less, the services are exactly the same, the service is far better, and my money is insured exactly the same as at Wells Fargo Sucks You Dry Bank.
Do I sound angry at Wells Fargo?--- heck no!! I am laughing all the way across the street, and laughing at the poor suckers who still have money there and still put up with terrible Wells Fargo service.

3) Keep a faithful DAILY record of your expenses in and out of any bank account. Use a written log, register, or computer software. DO NOT DO NOT DO NOT trust ANYTHING else, no online banking, no phone banking- as these are NOT ACCURATE BOOK KEEPING METHODS and in no way replace your PERSONAL WRITTEN RECORD KEEPING. Otherwise you run the high risk of getting totally screwed by  your bank in penalties if you make an error.  Hey, if you've got so much money and so little expenses that you don't need to keep a register, good for you. Otherwise, don't go by anything else.

4) Use your credit cards sparingly, and don't live beyond your means. Actually, I have NO CREDIT CARDS AT ALL NOW. I am FREE. Instead I use my Check Visa card to make purchases online, and when I don't have a check on me. But I am VERY careful about its' use.

Reserve credit cards for things like Brain Books and Music, and Brain Movie DVDs   :-)   where you need them to pay online purchases, or big purchases you don't want to write a check for.  Additionally, do without crap, and do without being lured into obscene interest payments, late fees, etc-- hooked with the lure of low starting interest and easy credit. Check every credit card statement for a raise in interest rates and CLOSE your credit card account and OPT OUT of any obscene rate changes. You'll lock in your original rate this way. 

Be HAPPY and FREE instead- which is PRICELESS.

5) Cut your Checking Debit Card to SHREDS.  See below....

Okay, these little debit cards are necessary if you have cut up all your regular credit cards (a very good idea) and need plastic for certain purchases online, or occasional other uses. But beware, these check cards can come at risk. Read the horror story below....

BRAIN MONEY SELF-QUIZ

What else can you think of that will put you in control of your expenses, your green energy, your interaction with people who get your
green energy?

Who will you choose to share your green energy?

A faceless corporate controlled robot entity-

Or A Human?

Think, and be happy.

MORE BELOW 

Back to: The Library From Another Dimension

Back to: The Really Affordable and Good Use of Money Brain Book and Music Store

The DANGEROUS DECEPTION

OF BANK CHECKING DEBIT CARDS

Of recent times, banks have been issuing, most often WITHOUT REQUEST FROM THE CUSTOMER, Checking "Credit" Cards and DEBIT CARDS.  These cards look EXACTLY like a regular credit card, and you pay with it at the store like a regular credit card. Banks advertise these cards with slogans such as "USE LIKE CASH" or "USE LIKE A CHECK".  However, these cards operate VERY DIFFERENT from cash or check.

Unlike cash, use of a debit/checking card draws funds from your checking account with a DELAYED POST- this means, that although you may have money in the bank when you use the card, and use of the card SEEMS to indicate sufficient funds to cover your purchase on a given day-  by the time the card payment posts to your account several days later, your account balance may be very different. If you have had other items come through, the earlier purchase may result in insufficient funds by the time the debit card purchase posts- even four days later or more. and then THE BANK DOES NOT CARE WHEN you made your purchase, and whether or not funds were available on that day, and you may be subject to high overdraft fees.

When you use an ordinary credit card, you are usually protected from making purchases over your available funds- not so with your debit card- it will theoretically allow you to make dozens or more charges, and will never let you know anything is amiss. The bank would love to have you make many purchase over the funds in your account in fact, because they will then charge you high fees to cover these purchases- even though they may only be $1 for a cup of coffee. Enjoy that $34 cup of coffee, please!

Use of the card also makes it much more likely that you will not enter these purchases in your account register, as you would with a check.

Use of the debit card does not require a PIN number for security, and ANYBODY could use your debit card, and charge or pay for virtually UNLIMITED purchases. There is nothing to stop a crook from doing so.

Further, the customer liability for fraudulent purchases using a checking debit card is FAR GREATER than for a regular credit card. Usually $50 for a regular credit card--  and up to ALL THE MONEY IN YOUR CHECKING ACCOUNT for a debit card- with no liability to the bank.

They will be SO HAPPY to issue a debit card to you today~!

Banks DO NOT INFORM THE CUSTOMER of these differences between a checking debit card and standard credit card and checks, save THE FINE PRINT.

This is a perfect example of corporate lack of responsibility in regard to serving ordinary folk.

Daffy and Bugs tell you these cards are better than a check, because you can use them without the "inconvenience" of providing identification. What Daffy and Bugs aren't telling you, is this: not only can you use your VISA check card without ID, but a thief may also use your card without identification, without a personal identification number and even without the card to drain your checking account, even if you don't lose your card or disclose your secret code. I know, not only because I work for a consumer group, but because I have been a victim of debit card fraud. After I used my card in a retail transaction, a thief took my receipt and used the number and expiration date to order merchandise over the telephone, and later to book a hotel room in Boston.

Credit card liability is capped by the Truth In Lending Act at $50. Regardless of the cap, you're in a dispute with the bank only about whether you owe the money. On the other hand, ATM debit card liability can go as high as $500, or even all the money in your checking account, under certain circumstances. Worse, you're not fighting about whether you owe the money, you're fighting to get your own money back. At least one victim of debit card fraud lost all of the money in his checking account, as well as several thousand dollars of a cash overdraft account.