The number of debit cards compromised at ATMs, merchants and restaurants in the U.S. rose by 10 percent last year, according to newly released information from Fair Isaac Corp., or FICO.


Swiping your plastic presents an inherent risk. ATMs and card payment terminals in stores and restaurants can be rigged by criminals trying to steal card numbers. T.J. Horan, vice president of fraud solutions at FICO, says: “The number of compromises and the number of card members impacted set a new record last year. While most devices are safe, fraudsters are developing new technology and methods for hacking ATMs.”

If you can’t prevent debit card fraud by abandoning your card, monitor your bank account closely. Watch for transactions you don’t recognize. That way, if your card is compromised and someone makes fraudulent charges using your card numbers, you’ll at least know about it early on. United Bank offers alerts through online banking so you can receive automated email or text message notifications of the types of transactions you choose.

Some hackers have figured out how to outsmart credit cards with EMV chip technology. Here's how to safeguard your cards – and your money. The tiny computer chips embedded in the front of credit and debit cards are designed to make the cards less vulnerable to fraud compared with cards that have only a magnetic strip on the back. But that doesn’t mean chip cards are invulnerable.

CBS New York reports that it appears some thieves have found ways around the microchip, sometimes called an EMV (Eurocard, MasterCard, Visa) chip. One consumer tells the news outlet that she discovered five “suspicious” transactions totaling about $2,300 on her chip card. Another consumer discovered a $200 withdrawal from an ATM in another city that she did not make.
According to CBS New York: “It only takes small modifications to skimming devices to bypass the chip and enable unauthorized uses of these cards, just like with the magnetic cards.”

So what’s a consumer to do when even the latest and greatest payment technologies show vulnerabilities? 

Monitor all cards closely. You should report problems as soon as they discover them. That means you must regularly monitor activity on all of your debit (and credit) cards — regardless of what type of technology they feature. Develop a routine that affords you time to log into your bank and credit card accounts online regularly, ideally daily. It should take no more than a few minutes to skim the latest charges for anything suspicious.

Information for this news item was excerpted from MoneyTalksNews.com