Debit card users and the risks they are exposed to highlighted by the latest scam

Debit card users are increasingly worried due to the recent security breach that was brought to light at the arts-and-crafts retailer Michaels Stores. There are around 185 million US consumers who own debit cards and these reports are causing a lot of concern since the reports claim that the thieves not only managed to steal the information from the debit cards from the stores across 20 states, but they also used them to withdraw money from the bank accounts of the customers.

Although this is not the first time that debit card information had been stolen, these crimes seem to be increasing every day and they are becoming very common these days. Last summer there were similar cases at the AldiInc grocery stores where there were customer complaints with regard to debit card fraud. Credit card and debit card frauds make up at least 20% of all data breaches which are up from 11% last time at the same time, as per reports from the Identity Theft Resource Center. The losses due to debit card fraud that the banks incurred in 2008 went up to a record $788 million, according torecent estimates from American Bankers Association and this is mostly due to counterfeit debit cards or stolen cards. This is likely to worsen as there are more fraudsters out there who are looking for information on debit cards all the time, states Jay Foley, Executive Director from ITRC.

Consumers in general find debit card theft more damaging than credit card theft. It doesn’t matter if it is the theft of the card or the information on the debit card this causes a lot of psychological damage for customers. When debit card holders report a missing card, they are not held responsible for the subsequent withdrawals. However, if they fail to notice until after the fraudulent transactions take place, they can be held responsible for a few charges or all charges. Sometimes, in the worst circumstances, debit card theft could easily wipe out the entire money in the bank accounts. Sometimes a consumer’s checking account may be linked to a line of credit in order to give overdraft protection, and even that may be lost under such circumstances.

Everything depends on the amount of time that is lapsed, states Lauren Saunders who is the managing attorney at Washington D.C. office, National Consumer Law Center. Consumers need to report a missing card within two business days to limit their losses.