Protecting Card Numbers

"Credit card numbers are a cyber criminal's most attractive target," said David Nelson, a fraud specialist in the FDIC's Division of Supervision and Consumer Protection. "Stolen card numbers can be used to make counterfeit cards and run up big charges on your account." Some new options to consider for protecting your credit card number include:

Single-use credit card numbers: Also known as "virtual cards," these are numbers issued by your bank or credit card company for one-time use with online purchases and catalog or phone orders. "By using a one-time account number, you get peace of mind knowing that your actual credit card number isn't revealed to the merchant and can't be stolen by a crook," said Nelson. "Plus, each number can only be used with one merchant, so it will be void if someone tries to use it elsewhere." Your authorized charges using a one-time number will show up on your monthly statement, just like any other purchase.

Password protection: When making a purchase online you must enter a password along with your credit card number. So far, this extra security measure is only available for online purchases at merchants that participate in the program. However, more and more merchants are making this security feature available.

Online credit card statements and account access: You may not realize it, but the ability to use your computer to check your credit card balance, receive alerts and monthly statements and pay your card bill online offers you ways to protect against identity theft, too. Examples: If your credit card issuer sends you periodic e-mails with current balance and payment information, you can look for suspicious transactions. When you get an e-mail saying your monthly statement is available online to view or print, this arrangement may replace the traditional mailing of your credit card statement and thus prevent the information from being lost or stolen. The e-mail alert, which will include part of your account number or some other sign of authenticity, links you to a secure connection that is encrypted and requires a password for access.

And if you don't have access to a computer or your computer isn't working, you may be able to make your card payments and get credit card account information electronically using your telephone.

Protections for Online Banking

Here are protections some banking institutions are offering to help consumers guard against errors or unauthorized transactions online:

Guaranteed bill payment: If your bank makes an error and an online bill payment arrives late, this service would cover any late fees.

Online authentication: Banks are coming up with new, innovative ways to identify their real customers from impersonators in Internet transactions. Don't be surprised if, as part of the online banking process, you are asked to verify something that you know but a crook wouldn't. (For more information, see Coming Soon to Internet Banking Customers: New Procedures for Verifying that "You are You".)

Avoiding Fraudulent Sites

There are numerous high-tech scams aimed at accessing your bank account online. In one example, known as "pharming," a computer virus or other malicious program redirects your PC to a fraudulent bank or retail Web site. The crooks behind the Web site collect your personal information for use in fraud and identity theft. The following services can help you:

The "padlock" symbol of certification: Before you enter personal information when banking or buying online, look for the image of a padlock on the lower part of your computer screen, double click on it, and read the certification information on the pop-up screen. It tells you who you are dealing with and that you are on a secure site certified by a trusted third party. "If there is no padlock," said Nelson, "you can't be sure who owns the Web site and how your information is protected in transit, and that means you are taking on more risk."

Verification engines: As an alternative to clicking on a padlock, you can install software onto your computer that will automatically tell you if a Web site you are visiting is real or fake. "Verification engines do the security work for you," said Robert Lee, a technology specialist in the FDIC's Division of Supervision and Consumer Protection.

Countering "Spyware"

Spyware refers to malicious programs that can get onto your computer in numerous ways, including when you open e-mail attachments or "instant messages," listen to music or watch videos online. Inside your system, spyware can secretly change your security settings and record your keystrokes. By doing so, the criminals can steal personal information (such as passwords or credit card numbers you've typed) that can be used to gain access to your bank account.

While spyware can be difficult to guard against, you can improve your chances by adding a "firewall" (to stop hackers from accessing your computer) and installing and periodically updating virus protection (to block and detect spyware). Some of these and other services can be found for free on the Internet. "Be selective because some products claiming to be anti-spyware software actually are spyware," said Aurelia Cardamone, a Senior Technology Specialist in the FDIC's Division of Supervision and Consumer Protection.

Nelson also suggests that you consider moving sensitive personal or financial records, such as tax returns or bank statements, from the hard drive of your computer onto diskettes or CDs that spyware can't access. "If the data are not stored on your computer, hackers can't find, copy, transmit, store and sell it," he said. "Just make sure you keep the diskettes or CDs in a safe place."