Connecting to Your World

Now that we may have scared the you-know-what out of you learning about identity theft, we thought it would be good to tell you that there are laws that protect you from having to pay for fraudulent charges (or charges made without your permission) to your financial accounts. Your rights for fraudulent credit card, debit/ATM card, and check purchases are outlined below:

If you have fraudulent charges on your credit card:

  • Lucky for you the Truth in Lending Act has your back. Your personal liability for unauthorized credit card charges is limited to only $50.00. However, to take advantage of this law, you must write a letter within 60 days of the first bill containing the error.

  • If your credit card number is used fraudulently (but the credit card itself is not used) you have no personal liability for fraudulent charges (in other words…you should owe zero, zilch, nada for those charges).

If you have fraudulent charges on your debit or ATM card:

  • If you have already read the credit card section of this website, you would have learned about all of the advantages of credit cards. One of these advantages is that they offer more protection against fraud than debit cards. Debit/ATM cards aren’t quite as simple as credit cards in terms of unauthorized charges. The amount you are liable for depends upon how quickly you report the loss. If you report a lost or stolen debit/ATM card within two days, you are liable for a maximum of $50.00. Within 60 days, you are liable for up to $500.00. After 60 days, you may be liable for all of the fraudulent charges.

  • You are not liable for any fraudulent charges made after your debit or ATM card is reported stolen.

If someone uses your checks to make fraudulent purchases:

  • Yes, even in our current world of electronic payments, check fraud still occurs. There is no exact personal liability amount for fraudulent checks as there is for credit and debit cards. If you are a victim of check fraud, notify the depository institution where the account is located AS SOON AS POSSIBLE. The amount of time it takes you to notify the depository institution of the fraud will often determine your personal liability for the fraudulent check(s). Most states hold the depository institution responsible for losses of a forged check if you notify the depository institution within a reasonable time. However, exact personal liability for check fraud will depend on many factors.

Overall, remember these simple tips:

  • If you discover that unauthorized charges have been made to one of your accounts, remember to report the fraud as soon as possible and your personal liability should be limited.

  • If you want extra protection against fraud, use a credit card instead of a debit card. In fact, it is highly recommended that you always use a credit card when purchasing anything on the Internet.

  • If you are a victim of fraud, you have rights and laws to protect you.


Wow, that was really

Wow, that was really surprising. I didn't really expect that kind of reaction from me. Everyone should really see this.

It’s a Jungle Out There

Credit, ATM and Debit Cards: What to do if They're Lost or Stolen – Information straight from the Federal Trade Commission.
Federal Trade Commission: Deter, Detect, Defend, Avoid Identity Theft – Everything you need to know about identity theft!
Learn about the difference between debit cards and credit card.