Using Online Banking to Protect Your Money
It's funny. I hear people talking about being afraid of using the Internet for online banking. They fear their accounts will be compromised by some unseen hacker and their funds will be siphoned out. Actually, the fact is that when a customer is practicing good computer security and Internet security techniques (as anyone connected to the Internet should), online banking can provide a powerful tool for detecting and preventing fraud losses.

[Good computer security and Internet security include having up-to-date, properly configured anti-virus software, anti-spyware, a personal firewall and promptly applying security updates and patches.]

In the paper world, there's a lag time between when transactions occur and when a customer receives his bank statement. That leaves weeks, sometimes, between when a fraudulent transaction occurs and when the customer learns about it.

In the online world, a customer can log on every day and do a quick review of the account. ATM withdrawald? Checks? Automatic debits or bill payments? It's easy to look at each one, and determine at a glance whether they're legitimate transactions or not. If you spot something that doesn't look quite right, a follow-up phone call or visit to your financial institution can help straighten it out.

Often, a customer that doesn't use online banking has no idea that unauthorized withdrawals have occurred or forged checks have been written until he receives the paper bank statement and reviews it. Sometimes a customer will learn of the fraud when he starts getting NSF notices (notices of insufficient funds) when there should be plenty of money in the account, and that sparks an inquiry.

The sooner you know about fraud in your account, the sooner you can put a stop to it.

The next time you make a deposit and the teller engages in chit-chat, they may actually be looking out for your financial welfare. The First National Bank South Dakota reported saving customers more than $1.1 Million by avoiding fraud losses in the first half of 2006.

Many times a customer will fall victim to a scam. There are Nigerian 419 scams, Internet sales frauds, fake lottery winnings and many more ways to steal your money. A conversation with a teller may actually reveal that a check being deposited is for more than the sales price of an item you sold over the Internet. The person who bought your car, collectible or other item requested that you send them back a cashier's check or that you wire the excess money to them. A red flag should go up because this is a common scam. The check is counterfeit, but this may not be detected until after it has traveled halfway around the world where the bank it is drawn on refuses it. Then it makes its way back to your bank, where you have to repay the bank the entire amount.

Avoiding these scams doesn't happen by accident. At First National Bank South Dakota, the Security Officer's learns what is happening across the country to banks and bank customers and trains the staff so they are aware and can help their customers.

BankingQuestions.com has a series of examples that you can compare a suspicious message to whether it is a phishing email, a Nigerian 419 scam, a potential virus carrying message or a fake lottery letter. See the examples here.