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Many people find it easy and
convenient to use credit and ATM cards. The Fair Credit
Billing Act (FCBA) and the Electronic Fund Transfer Act
(EFTA) offer procedures for you and businesses to use if
your cards are lost or stolen.
Limiting
Your Financial Loss
Report the loss or theft of your credit and ATM cards
to the card issuers as quickly as possible. Many
companies have toll-free numbers and 24-hour service to
deal with such emergencies. It's a good idea to follow up
your phone calls with a letter. Include your account
number, when you noticed your card was missing, and the
date you first reported the loss.
You also may want to check your homeowner's insurance
policy to see if it covers your liability for card
thefts. If not, some insurance companies will allow you
to change your policy to include this protection.
- Credit Card Loss. If you report the loss before
the cards are used, the FCBA says the card issuer
cannot hold you responsible for any unauthorized
charges. If a thief uses your cards before you
report them missing, the most you will owe for
unauthorized charges is $50 per card. This is
true even if a thief uses your credit card at an
ATM machine to access your credit card account.
However, it's not enough simply to report your
credit card loss. After the loss, review your
billing statements carefully. If they show any
unauthorized charges, send a letter to the card
issuer describing each questionable charge.
Again, tell the card issuer the date your card
was lost or stolen and when you first reported it
to them. Be sure to send the letter to the
address provided for billing errors. Do not send
it with a payment or to the address where you
send your payments unless you are directed to do
so.
- ATM Card Loss. If you report an ATM card
missing before it's used without your
permission, the EFTA says the card issuer cannot
hold you responsible for any unauthorized
withdrawals. If unauthorized use occurs before
you report it, the amount you can be held liable
for depends upon how quickly you report the loss.
For example, if you report the loss within two
business days after you realize your card is
missing, you will not be responsible for more
than $50 for unauthorized use.
However, if you don't report the loss within two
business days after you discover the loss, you
could lose up to $500 because of an unauthorized
withdrawal. You risk unlimited loss if you
fail to report an unauthorized transfer or
withdrawal within 60 days after your bank
statement is mailed to you. That means you could
lose all the money in your bank account and the
unused portion of your line of credit established
for overdrafts.
If unauthorized transactions show up on your bank
statement, report them to the card issuer as
quickly as possible. Once you've reported the
loss of your ATM card, you cannot be held liable
for additional amounts, even if more unauthorized
transactions are made.
Protecting
Your Cards
The best protections against card fraud are to know
where your cards are at all times and to keep them
secure. For ATM card protection, it's important to keep
your Personal Identification Number (PIN) a secret. Don't
use your address, birthdate, phone or social security
number. Memorize the number. Statistics show that in
one-third of ATM card frauds, cardholders wrote their
PINS on their ATM cards or on slips of paper kept with
their cards.
The following suggestions may help you protect your
credit and ATM card accounts.
For Credit Cards:
- Be cautious about disclosing your account number
over the phone unless you know you are dealing
with a reputable company.
- Never put your account number on the outside of
an envelope or on a postcard.
- Draw a line through blank spaces on charge slips
above the total so the amount cannot be changed.
- Don't sign a blank charge slip.
- Tear up carbons and save your receipts to check
against your monthly billing statements.
- Open billing statements promptly and compare them
with your receipts. Report mistakes or
discrepancies as soon as possible to the special
address listed on your statement for
"billing inquiries." Under the FCBA,
the card issuer must investigate billing errors
reported to them within 60 days of the date your
statement was mailed to you.
- Keep a record — in a safe place separate
from your cards — of your account numbers,
expiration dates, and the telephone numbers of
each card issuer so you can report a loss
quickly.
- Carry only those cards that you anticipate you'll
need.
For ATM cards:
- Don't carry your PIN in your wallet or purse or
write it on your ATM card.
- Never write your PIN on the outside of a deposit
slip, an envelope, or on a postcard.
- Take your ATM receipt after completing a
transaction.
- Reconcile all ATM receipts with bank statements
as soon as possible.
Buying
a Registration Service
For an annual fee of $10 to $35, companies will notify
the issuers of your credit and ATM accounts if your card
is lost or stolen. This service allows you to make only
one phone call to report all card losses rather than
calling individual issuers. Most services also will
request replacement cards on your behalf.
Purchasing a card registration service may be
convenient, but it's not required. The FCBA and the EFTA
give you the right to contact your card issuers directly
in the event of a loss or suspected unauthorized use.
If you decide to buy a registration service, compare
offers. Carefully read the contract to determine the
company's obligations and your liability. For example,
will the company reimburse you if it fails to notify card
issuers promptly once you've called in the loss to the
service? If not, you could be liable for unauthorized
charges.
For
More Information
The following federal agencies are responsible for
enforcing federal laws that govern credit and ATM card
transactions. Questions concerning a particular card
issuer should be directed to the enforcement agency
responsible for that issuer.
State Member Banks of the Federal Reserve System
Consumer and Community Affairs
Board of Governors of the Federal Reserve System
20th & C Sts., N.W.
Washington, D.C. 20551
National Banks
Comptroller of the Currency
Compliance Management
Mail Stop 7-5
Washington, D.C. 20219
Federal Credit Unions
National Credit Union Administration
1776 G St., N.W.
Washington, D.C. 20456
Non-Member Federally Insured Banks
Office of Consumer Programs
Federal Deposit Insurance Corporation
550 Seventeenth St., N.W.
Washington, D.C. 20429
Federally Insured Savings and Loans, and Federally
Chartered State Banks
Consumer Affairs Program
Office of Thrift Supervision
1700 G St., N.W.
Washington, D.C. 20552
Other Credit Card Issuers
(includes retail/gasoline companies)
Consumer Response Center
Federal Trade Commission
Washington, D.C. 20580.
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