Fraudulent Charge Debited to Schwab Account
Fraudulent Charge Debited to Schwab Account
Good morning all. I’ve got a question for folks with brokerage accounts at Schwab. I monitor my investments weekly, and when I checked my individual account at Schwab this morning I noticed that it had been debited for an unrecognizable VISA charge. I called Schwab and they’ve cancelled my debit card and are submitting my claim for reimbursement to their fraud department. The $ amount is relatively small and I have no reason to believe that Schwab won’t make good on this, but I’m puzzled as to how anyone could have gotten their hands on my debit card number since I’ve never used the card and it’s still in my possession. I pointed this out to the Schwab representative I spoke to and suggested that they or their bank might have an internal problem, but the rep indicated that they haven’t received any other reports of fraudulent charges on unused cards. Has anyone else with an individual account at Schwab had this problem or can anyone shed any light on how this could have happened? It's critical that my funds at Schwab remain safe, and I thought I had taken all necessary precautions. Now I'm not so sure.
Jena
Jena
Re: Fraudulent Charge Debited to Schwab Account
If you don't use the debit card, why not cancel it entirely?
Stay hydrated; don't sweat the small stuff
Re: Fraudulent Charge Debited to Schwab Account
I have ben led to believe there are armies of folks who both by hand and computer work on numeric banking codes looking to get an acceptable number "hit", in a small amount, before they move on to larger numbers. Last week someone tried a shopping spree with my PenFed gas card. We should all be thankful for fraud protection.
Re: Fraudulent Charge Debited to Schwab Account
This is why I will not have a debit card. A credit card gives better protection. When something happens, you do not have to wait for an investigation to get reimbursed. With a credit card, it is a charge that you have not yet paid, and they simply credit your account.
Re: Fraudulent Charge Debited to Schwab Account
Not true. Or at least not true in an absolute sense. My PenFed debit card was compromised just last week. They immediately credited me the full amount. If the investigation turns out that I made the charges, then they take the money back and throw me into jail.sport wrote:This is why I will not have a debit card. A credit card gives better protection. When something happens, you do not have to wait for an investigation to get reimbursed. With a credit card, it is a charge that you have not yet paid, and they simply credit your account.
Re: Fraudulent Charge Debited to Schwab Account
You are fortunate they have treated you this way. From what I have read, depending on the bank and the circumstances, it does not always happen like that.grettman wrote:Not true. Or at least not true in an absolute sense. My PenFed debit card was compromised just last week. They immediately credited me the full amount. If the investigation turns out that I made the charges, then they take the money back and throw me into jail.sport wrote:This is why I will not have a debit card. A credit card gives better protection. When something happens, you do not have to wait for an investigation to get reimbursed. With a credit card, it is a charge that you have not yet paid, and they simply credit your account.
Re: Fraudulent Charge Debited to Schwab Account
I look at it this way. For me, there is no compelling reason to use a debit card instead of a credit card. To the extent that CCs are better protected, it is a bonus. There is no downside that I can see.
It also helps me manage cash flow. The CC bills can be paid on a day of my choosing. I transfer money from VG (I'm retired) at the beginning of the month. All the direct debits on the account are scheduled at the same time as are the direct deposits. By the last week of the month I know (nearly) exactly how much cash I need to transfer at the beginning of the next month to fund the month.
It also helps me manage cash flow. The CC bills can be paid on a day of my choosing. I transfer money from VG (I'm retired) at the beginning of the month. All the direct debits on the account are scheduled at the same time as are the direct deposits. By the last week of the month I know (nearly) exactly how much cash I need to transfer at the beginning of the next month to fund the month.
Stay hydrated; don't sweat the small stuff
Re: Fraudulent Charge Debited to Schwab Account
Thanks for the responses. It looks my earlier reply may not have gone through, so I'll try again. Schwab issues the debit cards automatically ... or at least I don't remember asking for one. I kept mine because I'm nearing retirement and I thought I might use it once I shift from contributing funds to my individual account to withdrawing funds. I will probably cancel it now. Schwab, at least, does not automatically credit accounts for fraudulent charges. They told me that their fraud department would investigate my claim and, if approved, would credit my account in about 10 days. They indicated that my claim would likely be approved under the circumstances, but I'm still at risk in the meantime.
Jena
Jena
Re: Fraudulent Charge Debited to Schwab Account
For what it is worth, I put money in a Schwab MM account just to get the debit card which offers foreign exchange at ATMs for the same rate as they are charged. They also reimburse any ATM fees.
Since I travel to the UK a lot (DW is British), this saves a lot of hassle.
I only use it at ATMs.
Since I travel to the UK a lot (DW is British), this saves a lot of hassle.
I only use it at ATMs.
No matter how long the hill, if you keep pedaling you'll eventually get up to the top.
Re: Fraudulent Charge Debited to Schwab Account
I seem to have Fraudulent activity against my PedFed CC every year. Last year someone charged airline tickets. This year a supermarket in NH. I usually get a call from PenFed asking me if that was me and the charges are removed from my account and a new card is issued. This will mark the 5th year in a row of fraud. What the heck am I doing wrong?
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Re: Fraudulent Charge Debited to Schwab Account
I have a Schwab account (and debit card) as well. Like a credit card, Schwab does guarantee return of 100% of losses due to fraudulent activity. I've never had to test that, but I've had great experiences with their customer service on everything else.
That said, I use cash back cards for all my purchases. However, the Schwab debit card is very useful for ATM withdrawals, especially on foreign trips. There are no foreign transaction fees, plus they reimburse all ATM fees.
That said, I use cash back cards for all my purchases. However, the Schwab debit card is very useful for ATM withdrawals, especially on foreign trips. There are no foreign transaction fees, plus they reimburse all ATM fees.
Re: Fraudulent Charge Debited to Schwab Account
After reading this, I thought I would go and put an alert on my Schwab bank account. But I could not find one. I thus added the card to my Apple pay (yet to call for verification) iPhone 6+. I am hoping that transactions will show up there and that could serve as a quick alert when usage happens. Currently only my Amex Costco card has an alert for transaction when card not present. Because all my cards are now chip card, the risk of card duplication has reduced substantially. I wish all cards had the same level of alerts as Amex cards.
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Re: Fraudulent Charge Debited to Schwab Account
double post
Last edited by miles monroe on Sat Jun 13, 2015 11:26 pm, edited 1 time in total.
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Re: Fraudulent Charge Debited to Schwab Account
i will post a warning that everyone with a schwab checking account should check out.
i have a brokerage account and a checking account. one day someone stole a check from my mailbox, made fake checks on a laser printer, and used my checking account number. they ran one debit and one check through my account. luckily, i checked my account the day after the check posted and was able to close the account and get a new account opened.
here is the scary part. the default schwab uses if you bounce a check is to sell stuff in your brokerage account to cover a potential nsf. you need to call them and have this option turned off. i had $800 stolen from me. the debit was restored in about a week. the check took 3 months to get returned to my account. they could have taken the 5K that was in checking and then started on the balance in the brokerage account.
i have a brokerage account and a checking account. one day someone stole a check from my mailbox, made fake checks on a laser printer, and used my checking account number. they ran one debit and one check through my account. luckily, i checked my account the day after the check posted and was able to close the account and get a new account opened.
here is the scary part. the default schwab uses if you bounce a check is to sell stuff in your brokerage account to cover a potential nsf. you need to call them and have this option turned off. i had $800 stolen from me. the debit was restored in about a week. the check took 3 months to get returned to my account. they could have taken the 5K that was in checking and then started on the balance in the brokerage account.
Re: Fraudulent Charge Debited to Schwab Account
I never mail physical checks. I use my ING/Capital one account to have the bank mail out checks. In the remote event, I have to issue checks, I issue write out checks in reverse order and then mail them only in the post office mail box. When I open new accounts, I make it clear that I do not need a check book. When i apply for credit cards, I make sure to inform them, no "convenience" checks. Finally my credit account is always frozen. This protects my ID and bank account well.
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Re: Fraudulent Charge Debited to Schwab Account
i don't put checks in the mailbox anymore. any checks are now mailed from the post office.
Re: Fraudulent Charge Debited to Schwab Account
I had another conversation about general security with Schwab this morning. I don't have a bank account with Schwab and the debit card they sent me is linked directly to my brokerage account. The debit cards linked to brokerage accounts don't have the same foreign ATM advantages as the ones linked to Schwab bank accounts. I confirmed that, if you open a bank account, you can elect to turn off the insufficient funds feature that you noted above, but that you have to call Schwab to do that (you can't do it online when you open the account). I'm now considering opening a Schwab bank account and cancelling the debit card linked to my brokerage account. If I do that I'll reduce my risk by keeping the balance in my bank account relatively low and turning off the insufficient funds feature. I'll close my checking account at my commercial bank at the same time, as that bank, unlike Schwab, doesn't offer two factor authentication.miles monroe wrote:
here is the scary part. the default schwab uses if you bounce a check is to sell stuff in your brokerage account to cover a potential nsf. you need to call them and have this option turned off. i had $800 stolen from me. the debit was restored in about a week. the check took 3 months to get returned to my account. they could have taken the 5K that was in checking and then started on the balance in the brokerage account.
Thanks everyone for all of the good advice.
Jena
Re: Fraudulent Charge Debited to Schwab Account
Doesn't Schwab either immediately close or at least lock the account?They told me that their fraud department would investigate my claim and, if approved, would credit my account in about 10 days. They indicated that my claim would likely be approved under the circumstances, but I'm still at risk in the meantime.
Paul
When times are good, investors tend to forget about risk and focus on opportunity. When times are bad, investors tend to forget about opportunity and focus on risk.
Re: Fraudulent Charge Debited to Schwab Account
And, no doubt, you won't be able to withdraw funds to post bail from your debit card.grettman wrote:Not true. Or at least not true in an absolute sense. My PenFed debit card was compromised just last week. They immediately credited me the full amount. If the investigation turns out that I made the charges, then they take the money back and throw me into jail.sport wrote:This is why I will not have a debit card. A credit card gives better protection. When something happens, you do not have to wait for an investigation to get reimbursed. With a credit card, it is a charge that you have not yet paid, and they simply credit your account.
Steve
Re: Fraudulent Charge Debited to Schwab Account
The brokerage account is much better for some banking functions. For example, one can not wire funds using the on-line system from the bank account. One needs to fax in written instructions. Foreign wire transfers are not possible using the Schwab bank, but not a problem with the brokerage account. The only reason I got a bank debit card is because I felt uncomfortable having a link in to my brokerage account as it grows in size. I can keep a smaller amount in the bank account for using the free ATM debit card when traveling overseas.
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Re: Fraudulent Charge Debited to Schwab Account
Do you have a Platinum card?Jena wrote: The debit cards linked to brokerage accounts don't have the same foreign ATM advantages as the ones linked to Schwab bank accounts.
Logged on to my Schwab International One account, it shows:
I'm not a Schwab Bank user since they won't take me being overseas. I don't think the ATM advantages are only for International customers either since the fine print states "Schwab One Brokerage accounts" and doesn't mention international.Unlimited ATM fee reimbursements worldwide.1 When you withdraw cash at an ATM and are charged a fee, that fee will appear as part of your withdrawal. You’ll see the reimbursement for the fee on your next Schwab statement.
Unlimited ATM fee rebates apply to cash withdrawals using the Schwab Visa Platinum Debit Card wherever it is accepted. ATM fee rebates do not include currency exchange fees; fees imposed by merchants for POS transactions; or fees for stamp purchases, balance inquiries, or any transactions other than an ATM cash withdrawal from your Schwab One account.
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Re: Fraudulent Charge Debited to Schwab Account
This is correct. I have a Schwab Bank Debit card and the ATM fees are fully refundable both here and abroad (used it in the UK a bunch of times and all fees were refunded on my next statement).I don't think the ATM advantages are only for International customers either since the fine print states "Schwab One Brokerage accounts" and doesn't mention international.
As far as the accounts go in general, I've had the best functionality when I have an account of each type (i.e. brokerage, checking, savings). That seems to cover just about everything I want to do.
So to the OP I would highly recommend getting a Schwab Bank Checking account and card for daily use just to add another layer for someone to get through if the card # is stolen in the future.
Re: Fraudulent Charge Debited to Schwab Account
How did you manage to get an ATM card that isn't also a debit card? I have checked with every national/regional bank in my area and none of them will issue an ATM card that isn't either a Visa or MasterCard debit card.sport wrote:This is why I will not have a debit card. A credit card gives better protection. When something happens, you do not have to wait for an investigation to get reimbursed. With a credit card, it is a charge that you have not yet paid, and they simply credit your account.
Re: Fraudulent Charge Debited to Schwab Account
In addition to the regular debit/ATM cards, my bank has ATM cards that do not have a Visa or MasterCard emblem on them. They charge $1.00 per month extra for the privilege of having one.dkturner wrote:How did you manage to get an ATM card that isn't also a debit card? I have checked with every national/regional bank in my area and none of them will issue an ATM card that isn't either a Visa or MasterCard debit card.sport wrote:This is why I will not have a debit card. A credit card gives better protection. When something happens, you do not have to wait for an investigation to get reimbursed. With a credit card, it is a charge that you have not yet paid, and they simply credit your account.
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Re: Fraudulent Charge Debited to Schwab Account
Local/small regional banks/credit unions are far more accommodating. While they issue debit cards by default some still issue ATM only cards by request. Unlike sport, mine are no cost.dkturner wrote:How did you manage to get an ATM card that isn't also a debit card? I have checked with every national/regional bank in my area and none of them will issue an ATM card that isn't either a Visa or MasterCard debit card.sport wrote:This is why I will not have a debit card. A credit card gives better protection. When something happens, you do not have to wait for an investigation to get reimbursed. With a credit card, it is a charge that you have not yet paid, and they simply credit your account.
I don't use debits cards or checks for my online accounts. I keep a modest amount in my local bank and credit union. I use those for miniscule withdrawals and/or checks I need to write. If I need to write a larger check, I ACH the funds in. If I make the request by 4PM, the money is there the next morning.
Everything else is by credit card, online ACH (push/pull), or bill pay.
Re: Fraudulent Charge Debited to Schwab Account
I requested an ATM only card from my local bank, the default was the fake visa.
Mike
Mike
Re: Fraudulent Charge Debited to Schwab Account
I requested my credit union to issue an ATM only card that is not linked to the Visa system, and I was told they no longer do that.
Re: Fraudulent Charge Debited to Schwab Account
There was a more recent discussion on this topic: Displeased with Fidelity Cash / BNY Mellon- debit card theft. Ask your CU if they will lower your VISA charge limit to $0, independent of the ATM daily limit. They should be able to do so.That doesn't eliminate the possibility of fraudulent debits, but it essentially makes your debit card an ATM card as any VISA/signature charges will be declined.midareff wrote:I have ben led to believe there are armies of folks who both by hand and computer work on numeric banking codes looking to get an acceptable number "hit", in a small amount, before they move on to larger numbers. Last week someone tried a shopping spree with my PenFed gas card. We should all be thankful for fraud protection.
Re: Fraudulent Charge Debited to Schwab Account
dunscap wrote:There was a more recent discussion on this topic: Displeased with Fidelity Cash / BNY Mellon- debit card theft. Ask your CU if they will lower your VISA charge limit to $0, independent of the ATM daily limit. They should be able to do so.That doesn't eliminate the possibility of fraudulent debits, but it essentially makes your debit card an ATM card as any VISA/signature charges will be declined.midareff wrote:I have ben led to believe there are armies of folks who both by hand and computer work on numeric banking codes looking to get an acceptable number "hit", in a small amount, before they move on to larger numbers. Last week someone tried a shopping spree with my PenFed gas card. We should all be thankful for fraud protection.
That might be true but it's a credit card I use for gas purchases to get the 5% back. Restricting it to an ATM card doesn't work for me.
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Re: Fraudulent Charge Debited to Schwab Account
A credit card isn't an ATM card or a debit card, it is tied to a line of credit.midareff wrote:dunscap wrote:There was a more recent discussion on this topic: Displeased with Fidelity Cash / BNY Mellon- debit card theft. Ask your CU if they will lower your VISA charge limit to $0, independent of the ATM daily limit. They should be able to do so.That doesn't eliminate the possibility of fraudulent debits, but it essentially makes your debit card an ATM card as any VISA/signature charges will be declined.midareff wrote:I have ben led to believe there are armies of folks who both by hand and computer work on numeric banking codes looking to get an acceptable number "hit", in a small amount, before they move on to larger numbers. Last week someone tried a shopping spree with my PenFed gas card. We should all be thankful for fraud protection.
That might be true but it's a credit card I use for gas purchases to get the 5% back. Restricting it to an ATM card doesn't work for me.
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Re: Fraudulent Charge Debited to Schwab Account
Schwab WILL lower the point of sale limit to $0 upon request. This allow you to make withdrawals with PIN at ATMs worldwide and enjoy the surcharge reimbursement AND the no foreign transaction fees, but the card cannot be used for purchases (fraudulent or otherwise).
Re: Fraudulent Charge Debited to Schwab Account
I also asked my credit union to do this, and again they said that was not an option. This is the last straw...I have decided to take my banking business elsewhere...I am in the process of switching to Charles Schwab Bank.dunscap wrote:Ask your CU if they will lower your VISA charge limit to $0, independent of the ATM daily limit. They should be able to do so.That doesn't eliminate the possibility of fraudulent debits, but it essentially makes your debit card an ATM card as any VISA/signature charges will be declined.