My post the other day on 5 Good Reasons to Avoid Debit Cards stirred up some discussion on the lack of consumer protection offered by debit cards. The bottom line is that after a fraudulent charge on your debit card, your money is gone from your checking account until first you notice a transaction was made and second the bank completes an investigation. You could end up with a zero or negative balance in your most-used bank account for a period of time. All of this to me is unacceptable.
Thanks to The Consumerist, I noticed famous former fraudster, Frank Abagnale, agrees with this premise [Wall Street Journal]. You may be familiar with the movie that dramatized his life, Catch Me If You Can. According to the article, he has been teaching the FBI how to catch white-collar criminals.
These days, Mr. Abagnale never uses a debit card and writes checks rarely, paying for most everything with a credit card because, he says, credit-card issuers do the most to shield consumers from fraud. “My money is never at risk, only their money,” Mr. Abagnale says. But he adds that he pays the bill in full each month to avoid getting into debt.
I’ll follow the expert’s advice on this one.
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