Not Secure!

rb10

Bloomberg wrote: »

Banks advise customers not to keep large amounts of money in their current accounts in case of their debit card being cloned. Although the chances of this happening to you as an individual are slim it is advice given by all banks. My friend has a partner who works at Barclays and she said that they advise customers not to leave more than five hundred pounds in their current accounts.

In days gone by when interest rates were higher there would have also been the issue of missing out on interest. I hope this helps, all the best.

This is very true.

When fraud occurs, it is generally on current accounts. Savings accounts are rarely a target, because they are more inaccessible.

So, I only keep a few hundred pounds in my current account, except when bills are due. So no one would be able to get away with too much money before my bank started bouncing payments.

I'd far prefer this outcome than if I had, say, £5k in my current account for them to get hold of.

It's definitely worth keeping your current account balance as low as you possibly can. Keep your money in savings accounts instead.

Bloomberg

rb10 wrote: »

This is very true.

When fraud occurs, it is generally on current accounts. Savings accounts are rarely a target, because they are more inaccessible.

So, I only keep a few hundred pounds in my current account, except when bills are due. So no one would be able to get away with too much money before my bank started bouncing payments.

I'd far prefer this outcome than if I had, say, £5k in my current account for them to get hold of.

It's definitely worth keeping your current account balance as low as you possibly can. Keep your money in savings accounts instead.

There are some people who say that you should never use your debit card in shops or online. A credit card is by far the safest way to make purchases. If your debit card is cloned then the account will be frozen and will be a lot of hassle with direct debits and standing orders not being paid. There is could also be a problem with salary credits. If your credit card were cloned then it would be be far less hassle.

Someone in the bank onve told me that if a fraudster uses your credit card then they are stealing from the bank, with your debit card they are stealing from YOU!!. Worth remembering.

rb10

Bloomberg wrote: »

There are some people who say that you should never use your debit card in shops or online. A credit card is by far the safest way to make purchases. If your debit card is cloned then the account will be frozen and will be a lot of hassle with direct debits and standing orders not being paid. There is could also be a problem with salary credits. If your credit card were cloned then it would be be far less hassle.

Even if you never used your debit card anywhere at all, it still poses a small security risk. A common method of debit/credit card fraud is to generate lists of 16-digit card numbers, and three digit security codes. They then attempt (or, rather, have computers that attempt) to perform tiny transactions (i.e. just a few pence). When a combination is successful, they then take larger amounts from the card. So by never using a card at all does still leave the account open to the potential of fraud.

Bloomberg wrote: »

Someone in the bank onve told me that if a fraudster uses your credit card then they are stealing from the bank, with your debit card they are stealing from YOU!!. Worth remembering.

Remember that you are still liable for any transactions on your credit card until the bank agrees that they are fraudulent. So in a sense they are stealing from you.

However, it's far less painful (from the point of view of direct debits etc) to have your credit card out of action for a few days while the bank sorts it out than to have your current account out of action.

Bloomberg

rb10 wrote: »

Even if you never used your debit card anywhere at all, it still poses a small security risk. A common method of debit/credit card fraud is to generate lists of 16-digit card numbers, and three digit security codes. They then attempt (or, rather, have computers that attempt) to perform tiny transactions (i.e. just a few pence). When a combination is successful, they then take larger amounts from the card. So by never using a card at all does still leave the account open to the potential of fraud.



Remember that you are still liable for any transactions on your credit card until the bank agrees that they are fraudulent. So in a sense they are stealing from you.

However, it's far less painful (from the point of view of direct debits etc) to have your credit card out of action for a few days while the bank sorts it out than to have your current account out of action.

Just out of interest do you personally refrain from using your debit card in shops and on line?

rb10

Bloomberg wrote: »

Just out of interest do you personally refrain from using your debit card in shops and on line?

I personally use my credit card everywhere I possibly can. The main reason for this is that my current account pays no interest, just a flat £5 per month regardless of my balance. It therefore pays me to keep the balance of my current account as low as possible - just enough to cover direct debits going out.

I can then earn interest on my money by keeping it in a savings account until, transferring it back to the current account the day before my credit card's direct debit is taken.

iereboy

Lloyds is very security and money laundering conscious. (as all banks should be) When you put large amounts in, they want to know where it comes from, not because they are nosy but because they have a job to do.

When they mean your money is not safe in the current account - they rather you not keep large amounts of money in your current account as the chances of debit card fraud is higher on current accounts than savings accounts. Move your money in an instant access savings account.

Just to let you know if fraud happens on your current account, the process to get your money back CAN be VERY long, time consuming and involve a lot of chasing up on your path with possibly some missed direct debits and standing orders as well as charges and in some cases suspicion pointing in the direction of the customer. Missed direct debits means you having to call every single provider and make alternative arrangements and possibly affecting your credit file as well. Remember each case of fraud is different and the bank will cover you for fraud as well on your current account.

Personally I use my credit card for all my transactions (except withdrawing cash); when fraud happens on the credit card, its not my money they are taking its the banks and there are no direct debits involved. Credit card fraud is a bit less hastle and less painful than debit card fraud.

Hazzanet

rb10 wrote: »

Remember that you are still liable for any transactions on your credit card until the bank agrees that they are fraudulent. So in a sense they are stealing from you.

I was under the impression that the law recently changed and that you were not liable until the bank proved that you conducted the transaction(s) under dispute? Otherwise a full and immediate refund should be given by the bank until they are able to ascertain the transactions were genuine.

jambosans

iereboy wrote: »

When they mean your money is not safe in the current account - they rather you not keep large amounts of money in your current account as the chances of debit card fraud is higher on current accounts than savings accounts. Move your money in an instant access savings account.

Strange coming from a bank, who, to achieve one of their best interest rates, you must have a current account with Vantage. If they were so security conscious about large amounts in current accounts they wouldn't be offering 4% AER on balances between £5000 and £7000.

Normally the fraud process involves a temporary credit (as Hazzanet suggests) while your bank completes an investigation. Some banks will put in place temporary arrangements to allow bills to be paid (e.g. an temporary overdraft increase).

I agree with the general point though, current accounts pose a higher risk of being defrauded purely down to the supplied debit card. Savings accounts offer more restricted access, which should provide more security. Although I would argue that if access is gained to a current account via telephone banking, online or branch, linked savings accounts often allow instant transfers (so the fraud risk is just as great).

wigglebeena

So Lloyds' current account security measures are inadequate and incompetent, by their own admission? That's interesting.

jambosans

wigglebeena wrote: »

So Lloyds' current account security measures are inadequate and incompetent, by their own admission? That's interesting.

Even with the best fraud detection system in place, debit card fraud will still happen, regardless of the bank. Remember fraud can be caused by "inadequate and incompetent" behaviour on the customer's part (e.g. using the debit card on a suspect website), or even pure bad luck (e.g. a security breach on trusted website).