Is it Safe to Give a Bank Account Number?
Media often warns consumers to keep their personal and financial information private to avoid becoming victims of identity thieves and scammers. This information includes name, date of birth, Social Security number, credit card information, checking account information. A thief can use this information to open credit accounts, obtain loans in the victim's name. A scammer will take money out of the victim's checking and sometimes even savings accounts.
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Telemarketing Scam
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A telemarketer may ask for a checking account number during the sales pitch. He may say that is necessary for receiving a "free trial" offer. In some cases, a telemarketer may explain that the company will debit the customer's account at the end of the trial period by using a "demand draft," which looks like a regular check, but it does not require the account owner's signature. The owner may not know about the debit until he looks at the monthly statement.
Prevention
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To avoid becoming a victim of a scam, don't give out your checking account number over the phone, unless you know the company and understand why this information is necessary. Avoid "free trial" offers which usually carry a high price tag at the end of the trial period. Don't be afraid to ask questions if you don't understand the payment terms. Generally, sales companies will not ask for a checking account number, unless you have requested this payment method.
Contact the National Do Not Call Registry (see Resources) and request for your name and phone number to be removed from telemarketing lists.
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Law
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As of Dec. 31, 1995, a telemarketer must obtain a customer's verifiable authorization in order to debit his checking account. This can be done by recording a verbal authorization, by requesting a written authorization or by mailing a written confirmation before debiting the account. The telemarketer must also disclose the date and the amount of the draft, whom it is payable to, number of drafts (if more than one) and the telephone number the customer may call for additional information.
If You Have Become a Victim
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If you receive a written confirmation and the terms of the sale are not accurate, you can request a refund. A legitimate company will list the information on how to receive a refund. If you do not receive a refund, it is against the law. If you have become a victim of fraud, notify your bank immediately. Explain the situation and request to stop for all further debits from your account. Contact your state Attorney General to file a complaint against the telemarketing company.
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References
Resources
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