The Bank Account Takeover Epidemic
By Robert McGarvey
NEW YORK (MainStreet)--Even Microsoft billionaire Paul Allen's account was not safe from account takeover.
In Pittsburgh last month an AWOL Army private - who had a few months of community college education - told the court how he used a public computer to sniff out Paul Allen's Social Security number, his bank account numbers, his date of birth and his mailing address.
Then Brandon Lee Price called Citibank, convinced a customer service rep to mail him a debit card at his -- Price's address - and he briefly was in business. He even paid off a $658.81 student loan.
Other, larger purchases were blocked, and details are not clear as to why.
But the frightening takeaway is that even Allen, number 53 in the Forbes rich list with an estimated $15 billion, could be victimized in an account takeover.
What about you?
It's worse than you think.
"For $9.95 you can buy on the Internet a background report on just about anybody that will give you what you need to take over an account at many banks," said a security officer at a large financial institution. He said the report likely would have past addresses, history of property ownership, cars owned, parents' names and mother's maiden name, probably high school attended, are you getting the picture? Just about every challenge question - where did you live in 1st grade? - can be answered with a glance at the background report, and if that fails, there are Facebook and other social media outlets. To call this simple is to make it harder than it is.
Just when you want to withdraw all your money and stuff it into your mattress, know that banks and security outfits are hot in the chase for tools to prevent account takeovers, or at least to minimize the damage done.
And in a way the Paul Allen case proves that, too. Price, according to the trial testimony, attempted over $1 million in larceny. He apparently got away with under $1,000.
But know this: "This is a big problem and it is getting bigger," said Glen Sgambati, chief risk and security officer at Early Warning, a security company. "Banks have to get much more proactive about stopping it."