Listen weekdays from 1-3pm ET
(No audio? Try our help)
Recent shows | More media

Listen Live: Mon-Fri 1-3pm ET

Posted: 6:00 a.m. Thursday, April 24, 2014

How To Protect Yourself After the Michaels Breach

3 Million Customers Were Impacted in Multiple States



By Clark Howard

ClarkHoward.com


Prepare to be underwhelmed by the numbers of the latest data breach.

After last year's Target breach that impacted 110 million people, there's news of a data breach at craft retailer Michaels...and it involves about 3 million customers. That's like child's play in light of Target, right?

Of course, I'm being facetious; the Michaels news is nothing to laugh at.

"The affected systems contained certain payment card information, such as payment card number and expiration date," the company's CEO writes online. "There is no evidence that other customer personal information, such as name, address or PIN, was at risk in connection with this issue."

Click here to see a full list of the stores that were impacted and when the breaches took place.

So this latest episode just serves to underscore the ubiquity of data breach in our world today. Where can you turn? What do you need to do next? I've put together this guide to help you.


Watch your statements carefully

If you're among the affected, you need to go through your credit card and debit card statements this month and next month with a fine tooth comb. Identify any bogus charges the crooks may have pushed through and dispute them immediately with your bank or credit card company.

Use an abundance of caution

This is a time when you need to beware of anyone calling or emailing you trying to impersonate Michaels or your bank. The cons may ask you to click a link or to verbally confirm additional personal information over the phone.

As stated before, when in doubt, hang up the phone or close out the email. Then call your bank or visit the merchant website to verify the legitimacy of the request.

If you remember one thing, it should be this: Do not click on any links in emails that come related to this breach!

Time to kick debit out of your life?

The reality is customers who used a debit card were hit hardest by this breach. If you wish to continue using debit in the future, be sure you tie it into a separate account that's only used for debit transactions so only that money is at risk.

You'll also want to see this list of places you should never use a debit card, and this follow-up story with even more trouble spots that we recently ran.

Understand the real dangers of debit vs. credit

To understand just how bad debit cards are, you first have to look at the consumer protections afforded to credit cards. In a case like this breach where crooks just have your credit card number but not the physical card, normally that means zero dollar liability. In the worst case scenario, your maximum liability would be $50…and some issuers will waive even that.

If you used a debit card though, it's a whole different story. Debit cards are dangerous to your wallet. They don't have the normal protections under federal law offered by a credit card. Our nation's magnetic strip technology undermines our financial safety and makes us a target for hackers.

With a breached debit card, you have only 2 days to notice that money is gone from your account...or else your liability rises to $500. And under some circumstances, your liability with a debit card can be unlimited.

 

For further reading: