Stolen credit card or debit card information: your options

The recent theft of data for millions of cards at Target raises once again the question of what you can do to protect yourself.   The answer is that after the fact your options are limited, but you can prevent a lot of problems if you:

Use a credit card, not a debit card.  They offer better protection.

“If a fraudster steals your credit card number and uses it, they’re stealing the bank’s money, not your money,” said John Ulzheimer with “If a fraudster steals your debit card number and uses it, they’re stealing your money and you’ll have to argue with the bank to get your money back.”

Federal law limits losses on a credit card to $50, but all the major credit card companies have zero liability policies; so you will lose nothing on fraudulent charges.

Debit cards have some protection, but they require notification in a limited time and also require you to recover what you’ve lost by convincing the bank you are not liable.

“Debit cards are fine, right up to the point where they get stolen, and then they’re no longer fine,” Ulzheimer said. “In my mind, if you qualify for a credit card and have the willpower not to run up a massive amount of credit card debt, then credit cards are a safer alternative.”

Things that won’t help after  your card info has been stolen.

  • Free credit monitoring. If they haven’t stolen your Social Security number, date of birth or account passwords, this service, which can be useful in those cases, won’t help.
  • Security freezes. This is when you notify the credit reporting agencies not to open any new accounts in your name before notifying you.   This does not affect fraudulent credit card or debit card charges.
  • Changing PIN on debit card. This is of limited value since debit cards can be used without a PIN at most stores.  You should get your bank to cancel your debit card and issue a new one.
  • Choosing credit instead of debit. If you check “credit” when they swipe your debit card, you do not get the same protection as you would with a credit card.  All that does is allow you to use a signature instead of a PIN.   It’s still a debit card.

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