Consumer Law

Linking a Checking Account and Debit Card Could be Risky

Having a checking account that's linked to a debit card is almost a necessity these days. It is a standard option offered by most banks. However, this doesn't mean that all checking accounts are the same. When you open an account, the documents you sign create a contract or agreement between you and the bank, covering essential details.

Examine Your Checking Account Agreement

Checking account agreements generally cover the rate of interest, if any, that's paid on your checking account balances:

  • How the bank handles checks drawn from your account
  • The fees the bank charges for a negative account balance
  • Monthly maintenance fees
  • How quickly your deposits become available for withdrawal

and a long list of other issues, such as the bank's responsibility to you for errors it makes.

Linking Your Checking Account to a Debit Card

Linking your checking account to be debit card may require a separate agreement. Common issues addressed by these separate agreements include daily restrictions on the amount of money you can withdraw from ATMs, as well as the number of ATM transactions you can make each day from the bank's terminals. The agreement may also list the fee you'll pay for each withdrawal you make from an ATM that isn't operated by your bank and whether you can stop payment for disputed charges with merchants.

Many Fraudsters Who Target Debit Cards

Your entire account balance can be depleted within minutes if your debit card, or the information printed on it, falls into the hands of a fraudster. In this situation, your best defense is to immediately report the card as lost or stolen. If you report this issue to your bank within two days, U.S. law limits your loss to $50. This means that any amount above $50 that is stolen from your account is reimbursed by your bank. Waiting longer than two days, however, may cost you up to $500 instead of $50.

Traditional Checking Accounts Aren't Immune to Fraud

People can also use your checks to make unauthorized withdrawals. For this reason, you may want to think twice before signing blank checks or mailing a completely filled out check to people and companies with whom you don't usually deal. The last thing you want is for a skilled fraudster to add an additional zero or two on the check amount, or for someone to fill in a name on a lost blank check.

A Consumer Lawyer Can Help

The law surrounding checking accounts and debit cards is complicated. Plus, the facts of each case are unique. This article provides a brief, general introduction to the topic. We hope you found it useful. For more detailed, specific information, please contact a banking lawyer.

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