From Scott Marinoff…
I'd appreciate it if you'd post your thoughts (or anything you've seen online) about how consumers should address the recent payment card troubles at Target. I usually shop there a few times a month – including within the Black Friday through mid-December timeframe when the hack happened.
Since hearing about this, I've checked my online banking website daily for any unusual activity. None yet, but some of the news reports say it could be weeks or months before the stolen card information might actually be used. I'd rather not call my bank and get a new card if there's no need to. The phone lines to Target are apparently jammed and it's not clear if they know or if they would even tell a consumer if their card information was affected. So, all that's left is a waiting game, with daily worry if or when the other shoe will drop and cause financial headaches.
You're always pretty savvy when it comes to dealing with large organizations when things go wrong, so I await your wisdom on this situation.
Well, if what I'd had ripped-off was a debit card, I'd cancel it immediately. Beyond that, I'm not sure you're at any greater risk than you are all the time with credit cards. Two nights ago, you ate at a restaurant and for a few minutes, your Visa card was away from you and several restaurant employees could easily have copied down all the info on it. They can wait a few months, then post just as many unauthorized charges to your card as the folks who obtained that info by hacking Target.
Matter of fact, I'd be more worried about info stolen on a small scale. The busboy at the restaurant who passed your info on to his brother-in-law only stole 20 or 30 numbers that way all week and might well try to use all of them at local businesses. The Target hackers stole 40 million numbers and the majority will probably never get used that way…or will be used from all over the world. Even the stupidest credit card company in the world will smell large rodents if you live in San Diego and usually purchase gas and groceries locally…and suddenly, your card is being used to charge purchases of rifle ammo in Reykjavík, Iceland.
What I'm getting at is that I think you should always monitor your credit cards as if your numbers are in unauthorized hands…because probably, somewhere, they are. And with regard to the Target situation, read this.
I don't know why in the age of Smartphones, credit cards don't work more like this…
- You charge a purchase in a store to your credit card.
- When the store phones or "internets" in to check on the card, the credit card company dispatches a text message to your Smartphone.
- You receive the message and it asks you to confirm your purchase of $828.43 at Whips 'R Us.
- You type in a little 4-digit code to confirm it and the purchase goes through.
Now obviously, not everyone has a Smartphone or would want the occasional hassle…but if my company offered me a card that worked like that, I'd get one. I would think it would be especially good for online purchases. There must be a reason they haven't tried this.