While I was on vacation this week, some thief was busy emptying out my checking account.

I have always loved the convenience of debit cards, but this recent experience has me re-thinking the cost of that convenience.

First, your liability if you are a victim of debit card fraud is greater than if someone steals your credit card or uses your credit card to make unauthorized purchases.

With credit cards, your liability for unauthorized transactions is limited to $50. However, most major credit card issuers have a zero liability policy, so you typically aren’t liable for anything if you are a victim of credit card fraud.

With debit card fraud, your liability is limited to $50 only if you notify your financial institution within two business days after realizing their card has been lost or stolen. After that, your liability is limited to $500 if you report any suspicious activity within 60 days of receiving your account statement. After 60 days, your liability is unlimited, so it’s very important to check your statements on a regular basis.

Continue Reading Debit Card Fraud Much More Damaging Than Credit Card Fraud

Now that the holidays are over, it’s a good idea to check your credit report. Unfortunately, the holidays are a peak time for credit card fraud and identity theft, and checking your credit report is sometimes the only way to catch fraud.

You can check your credit for free at www.annualcreditreport.com. This report does not include your credit score but it can be purchased for $12.

There are three credit reporting agencies, and each of them is required to give you one
free report per year. Which means you can actually get 3 free credit reports each year, by requesting 1 report from each reporting agency. I suggest that you stagger these requests out over several months, rather than requesting from all 3 reporting agencies at once.