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The Latest Data Breach in America: What Happened and What We Can Do About It

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In today’s increasingly digital world, data breaches have become an all-too-common occurrence. The most recent breach in America, which targeted a major financial institution, has once again brought the issue of cybersecurity to the forefront of national conversation. The breach, which compromised the personal and financial data of millions of Americans, serves as a stark reminder of the vulnerabilities that exist in our digital infrastructure.

What Happened?

The latest data breach involved the unauthorized access of sensitive information from a prominent U.S. financial institution. According to initial reports, cybercriminals exploited a vulnerability in the company’s online systems, allowing them to infiltrate databases that contained personal information such as names, Social Security numbers, credit card details, and bank account information. While the exact number of affected individuals is still being determined, early estimates suggest that millions of Americans may have had their data compromised.

The breach was detected when unusual activity was noticed on the institution’s servers, prompting an internal investigation. Unfortunately, by the time the breach was discovered, the attackers had already accessed and potentially exfiltrated large amounts of data. The incident has raised serious concerns about the state of cybersecurity, not just within this particular institution but across all sectors that handle sensitive data.

The Consequences

The consequences of a data breach of this magnitude are far-reaching. For the affected individuals, the immediate concern is the potential for identity theft and financial fraud. With access to personal information, cybercriminals can open fraudulent accounts, make unauthorized transactions, and even sell the data on the dark web, where it can be used by other criminals.

Beyond the individual level, data breaches can also undermine trust in institutions and the broader financial system. When consumers feel that their data is not secure, they may be less willing to engage in online transactions or share personal information, which can have a ripple effect on the economy.

Moreover, the cost of dealing with the aftermath of a data breach is substantial. Companies often face significant financial penalties, legal fees, and the costs associated with notifying affected individuals and providing credit monitoring services. There is also the potential for long-term damage to the company’s reputation, which can impact its bottom line for years to come.

What Can We Do About It?

While it may seem that individuals are powerless in the face of such large-scale cyberattacks, there are steps that we as citizens can take to protect ourselves and mitigate the impact of data breaches.

  1. Monitor Your Accounts Regularly: Keep a close eye on your bank and credit card accounts for any suspicious activity. Set up alerts that notify you of transactions, and report any unauthorized charges immediately.
  2. Use Strong, Unique Passwords: Ensure that your online accounts are protected by strong, unique passwords. Avoid using the same password across multiple sites, and consider using a password manager to keep track of your credentials.
  3. Enable Two-Factor Authentication (2FA): Whenever possible, enable two-factor authentication on your accounts. 2FA adds an extra layer of security by requiring you to verify your identity through a secondary method, such as a text message or an authentication app.
  4. Be Cautious with Personal Information: Be mindful of the information you share online, especially on social media. Cybercriminals often use publicly available information to answer security questions or craft phishing attacks.
  5. Stay Informed: Keep up to date with the latest news on data breaches and cybersecurity. Knowing which companies have been compromised can help you take timely action to protect your data.
  6. Freeze Your Credit: If you believe your information has been compromised, consider freezing your credit with the major credit bureaus. A credit freeze makes it more difficult for criminals to open new accounts in your name.
  7. Advocate for Stronger Protections: While individual actions are important, it’s also crucial to push for stronger cybersecurity measures at the corporate and governmental levels. Support legislation that requires companies to implement better security practices and hold them accountable for protecting consumer data.
  8. Use Identity Theft Protection Services: Consider enrolling in an identity theft protection service that monitors your personal information and alerts you to any potential threats.

Conclusion

The recent data breach in America is a sobering reminder of the vulnerabilities that exist in our digital world. While we cannot eliminate the risk of cyberattacks entirely, we can take steps to protect ourselves and mitigate the damage. By staying vigilant, using robust security practices, and advocating for stronger protections, we can play a role in safeguarding our personal information in an increasingly connected world.

Wal-Mart Offers new GoBank Accounts Without Overdraft Fees

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WalMart New Accounts
Shopping giant Wal-Mart has opted to provide a card-based program for customers who may overspend their accounts while purchasing in their stores

Joining other large retailers that engage in semi-banking practices, shopping giant Wal-Mart has opted to provide a card-based program for customers who may overspend their accounts while purchasing in their stores.

The world’s largest retailer had teamed with Green Dot Corp., a leader in creating reloadable prepaid cards. New mobile checking accounts issued by Wal-Mart under the cooperative effort will not require fees for overdrafts and bounced checks. An $8.95 monthly fee will be charged for these GoBank accounts. The fee is waived if there is a deposit of $500 or more each month.

Accounts can be opened by purchasing a $2.95 starter kit at any Wal-Mart Store. A smartphone is a necessity, since most of the banking transactions are done through an app. Credit Bureau ratings commonly used to determine eligibility are not part of the application requirements. The idea behind GoBank is to provide options for people who don’t have a lot of money and may have poor credit scores.

The kit includes a MasterCard debit card that can be used to withdraw money or make purchases. No fee is charged for ATM withdrawal services at the 42,000 locations around the country. If money is withdrawn from ATMs outside the system, a $2.50 charge is levied. A 3 percent fee is added to withdrawals outside the United States.

The new arrangement is one of several moves being made to help Americans who are still feeling the effects of the recent recession. Both Bank of America and Citibank have begun offering fee-free accounts this year.

Regulators have been looking more closely at overdraft fees, which in some instances can go up to $35 per incident. The regulators have responded to concerns by requiring banks to get written approval from a customer to provide overdraft protection, which allows a customer’s account to dip below zero. Those who choose to have the overdraft protection still pay high fees. Some customers at large banks regularly rack up fees in the neighborhood of $260 a year, according to the Consumer Financial Protection Bureau.

Wal-Mart’s Daniel Eckert, senior vice president for services, said GoBank was the retailer’s response to customer concerns that regular banking fees are too high.

Numerous Bank Fees Can Be Decreasing Your Assets

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Banks and Fees: They Go Together

bank-feesThat little extra twinge you feel when you tote up your bank account is likely the added fees you pay for the privilege of banking. Typically, there may be some you didn’t even know about. Banks, according to a Market Watch article in the New York Times, aren’t always up front about such things.

The average checking account is subject to some 30 fees, but some institutions have lists of up to 50. That’s according to a 2013 survey by WalletHub.com, a financial website. And, the survey found, about 20 percent of the banks contacted don’t provide prospective customers a list of these charges when they submit an online application. Only two of the banks included in the survey earned perfect scores on the WalletHub quest for full transparency. Fewer than half – 48 percent – had direct links on their product pages to alert customers to the full gamut of fees.

It may or may not make you feel better to know that airlines are worse, with up to 150 potential fees. The list for banking fees is long an varied but may include a fee simply to have a checking account. (In 2009, some 76 percent of banks offered free checking. By 2013, the number was down to 39 percent.) Then, you may pay a fee to use a competitor’s ATM. And the list goes on.

Some of the fault lies with banking consumers. Only one in three makes the kind of annual assessment that would advise them of the fees they are paying. Only 15 percent reported ever having looked into fees at their particular financial institution, Kasasa found when it surveyed 1,000 adults. (Kasasa is a new financial institution devoted to creating communities by uniting small credit unions and small banks.) Federal regulations now require that such information be available, but it’s up to you to find it.

Banks have been more forthcoming in recent years, but there has been a commensurate increase in the number of fees. But to get the information specific to your bank account, you may have to plow through an average 44 pages of information, which still may be incomplete.

Five things to look for:

1. Banks are allowed to change the order of processing checks and electronic transfers. That means that if you have a $50 purchase and another for a minor item (a cup of coffee, perhaps) the larger item is processed first, increasing the bank’s potential to collect overdraft fees on a greater number of smaller purchases. The number of banks that do this has decreased in recent years. About 22 percent of the largest banks no longer do it and the percentage of those that do has gone from 51 percent to 49 percent.

2. The bank may hold a transfer for several days, increasing the institution’s potential for interest income. It may take several days, for instance, for payments to utilities to clear. For the customer, it may make a difference of only a few cents, but with millions of customers, the bank may see a significant advantage. No federal regulations are in place to force a bank to speedily process your payment.

3. Though many banks have created standard disclosure boxes, financial experts say there still is “vast room for improvement.” Making comparisons bank-to-bank is hard because of the length and different ways of identifying the same fees. Pew’s Model Disclosure Box has been adopted by 56 percent of the country’s banks, making it easier to make comparisons. The Consumer Financial Protection Bureau has proposed such mandated disclosure for prepaid cards, but has announced no plans to do the same for banking accounts.

4. Fees for overdrafts are the bank’s biggest money-makers. Such fees make up 60 percent of their fee income, according to the CFPB. More than half of bank customers don’t even know if they have overdraft protection or what their particular coverage consists of. Recent figures show that the number of involuntary closures of accounts based on overdraft issues is rising. It is possible to opt out of the service, with written confirmation of their choice.

5. About three-quarters of banks will let you go into overdraft at ATMs or at points-of-sale with your debit card. But each such transaction will push your account further into the negative, with a fee charged in each instance. The purchase amount will be pulled from your next deposit, along with the fees. Fees for overdrafts have increased steadily and now stand at $35 to $37 per instance at most banks. A transfer from another account at the same bank (savings, for instance) to cover the overdraft is usually about $10.

There. A word to the wise for those who don’t want to be fee-d to death.

Run On China Bank Gives Consumers Food For Thought

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When The Rumors Aren’t True

Keeping close tabs on our money is an American fact of life. In general, we like to be able to deposit what we have in what we believe to be a secure holding institution and then relax.

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Customers getting money out of the Jiangsu Sheyang Rural Commercial Bank
But what happens when an alarm is sounded and there is the possibility that we relaxed too soon? How do we react when there is even a hint that our particular financial institution could be in trouble and that our share of the money being held could be in jeopardy?

Fortunately, the United States has built safeguards into its banking systems, including federal deposit insurance, and the likelihood of a “run” today is miniscule. But a recent story out of China shows what can happen when rumors run rampant and cool heads do not prevail.

How The China Bank Run Started

A customer in Yancheng, China, went to his bank and requested a withdrawal of 200,000 yuan, the equivalent of $32,200 in American dollars. The story goes (and the details have not been clearly defined) that when the customer’s request couldn’t be immediately honored, he assumed that the bank had run out of money and panic ensued.

Panic Rampant

Soon, depositors arrived in droves, by any and all means of transportation. Though regulators and spokespersons for the central bank assured the bank’s clientele that their money was safe, the flood of customers demanding their full amount kept arriving. The beleaguered bank stacked piles of yuan on its counters to create the appearance of plenty, but even that ploy and the sight of armored cars bringing cash to aid the besieged institution didn’t immediately quell the tide of anxious customers. The run continued for three days.

Customers’ concerns were probably magnified by China’s failure to meet a domestic bond recently. The default was a first in the mega-country’s current financial history, but it lent itself to ongoing itchiness about all aspects of the country’s financial security.

Lessons From The Bank Run

There are many versions of what happened in Yancheng, but the lessons for Americans are the same.

The news of this story spread quickly. All it took was one customer who used a twitter like service to notify his circle of friends. From that point hundreds of people heard about the customer’s experience and soon it gained world wide attention. The Chinese people have a heritage of fearing for the safety of their money. Older generations of people experienced government confiscation of property and wealth. It is no wonder that panic resulted.

So what is the lesson American people can gain from this? When rumors start, don’t panic. Check other sources for the truth to the rumor. Give yourself some time to make the best decision for you and your family. Though time would be of the essence in a real bank failure, it is foolish to over-react.

The bottom line is to look before you leap. Trust in the safeguards that have been built around the country’s financial practices. Certainly you are justified in making immediate inquiries if there is a suggestion that something is wrong, but don’t just assume that the rumors are true. Often, they are not.

CPSA Sets Standards For The Check Printing Industry

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check-writingAlthough paying by check is not as common as it once was, it’s a financial practice that is likely to have long-term value in the economic scheme of things, according to the Check Payment Systems Association. And their prime role is to promote and protect what is referred to as the “paper-based” payment system.

The non-profit organization has been involved since 1952 in assuring that using personal checks and business checks will remain a viable option for individuals and businesses. It is dedicated to the integrity, security and convenience of checks. It has been at the forefront of developing safeguards that are built right into the checks you use. Its advice has been incorporated into check-printing practices for ValueChecks.net main check printing partners.

Preventing Check Fraud

One of CPSA’s most valuable contributions has been in developing strategies that thwart criminals bent on check fraud. In 1994 the association created a set of guidelines intended to prevent the production of counterfeit checks. The guidelines are voluntary, but have been applied by the majority of check-printing companies in North America. Would-be counterfeiters have been significantly stymied in attempting to use computer scanners, laser printers or photocopiers to produce fake checks.

Key to the effort is the Padlock Icon, touted as CPSA’s greatest contribution to the fight against check fraud. The small symbol appears on the front and back of personal and business checks that were designed with at least three safety features. Those who routinely accept checks recognize the Padlock as  evidence that the checks are protected by production safety steps. Only CPSA can legally grant the right to use of the Padlock on checks.  The association’s website lists authorized users, such as those check companies who print checks for Valuechecks.net.

CPSA partners with the American National Standards Institute to study issues surrounding the use of checks. It also does research to assist members with development of products and services. It’s influence is recognized and respected in Washington D.C. as federal government agencies consider these issues. Lawmakers whose business is to protect citizens make use of the information generated by  CPSA researchers.

Beneficiaries of the efforts being made by such organizations are those at the end of the chain — the individuals and companies that continue to make writing checks their standard for doing business.