Most consumers understand the potential dangers of sharing their credit card numbers. But fewer realize they put themselves in even greater financial jeopardy when they share information about their checking accounts. It’s riskier than you think.
In the past few years, more consumers have been complaining about unauthorized debits from their checking accounts. Some were victimized after paying with a check; others lost money after they used their checking account to make an electronic payment by phone or Internet.
One woman, a 75-year-old widow, said a company she paid with a check in 2006 used the routing and account numbers on the document to make an unauthorized second charge a year later. “I told a company representative not to renew my service because I couldn’t afford it. But when I received my bank statement, I discovered $300 had been debited without my consent,” she complained.
Many consumers authorize automatic debits from their checking accounts to cover recurring charges such as car loans and mortgage payments. It’s quick and convenient. But the system is also easily abused, the Federal Trade Commission states.
Once it has a consumer’s checking account information, a questionable business can initiate one or recurring debits from an account. So treat your checking account information as carefully as your credit cards. Think before you give out the number over the phone or on the Internet.
Even if you just provide it for “verification” or “security purposes”, someone could raid your account, the FTC warns. Some consumers have lost hundreds of dollars from their checking accounts because they fell for unsolicited phone or Internet offers. They typically provide their checking account information because they think they’ve won a prize and need to provide it to qualify for the offer.
Once a dubious business has the checking account information, it can set up a “demand draft,” a type of electronic check that does not require your signature. Those kinds of debits are easy to start, hard to stop?and harder to reverse than unauthorized charges on a credit card.
5 responses so far ↓
1 Ms. W // Sep 27, 2008 at 10:14 am
This is very scary. I am assuming that giving account info to major utilities, major cable companies, and my credit card companies and department store charge cards are okay. Please tell me if I’m wrong.
2 Loris Hamilton // Sep 27, 2008 at 7:03 pm
Asa, how do I get the phone number and name of the President of Time Warner/NY? Also address. Have decided to take them on. Recently THE VIEW started with Whoppi and Sherri complaining and I sure have complaints about their lack of communication, resusal to give names and extensions, infernal wait to get them by phone,. etc. Understand they have so many complaints against them that their license is in question this Fall. Loris Hamilton
3 Asa Aarons. // Sep 28, 2008 at 9:36 am
Ms W: It’s ok to give the number to companies you know and trust. Asa
4 Jimbo // Mar 17, 2009 at 10:05 pm
sorry Asa I disagree. I only give out my number for things like my work with direct deposit or online banking.
For utility companies it’s easier to set up bill pay through your bank. It doesn’t give utility companies authorization to withdraw money.
Besides cable companies are the worst for getting bills incorrect (my personal vendetta is Verizon).
Just my two cents
5 Marie // Aug 26, 2009 at 7:53 pm
I recently fell victim to a scam where a supposedly good samaritan convinced me to purchase a magazine subscription for a local children’s hospital (dumb, I know…it was a moment of weakness). Anyway, I gave the con artist a check. Once I discovered the scam after doing a little research, I stopped payment on the check. Do you think I also need to have my checking account number changed? Thanks for your advice!
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