The vast majority of Americans are now doing online banking, which means keeping your transactions safe is more important than ever.
According to a new Federal Reserve study, approximately 74% of us used online banking to access banking services in 2014 — the most recent year for which data is available. That makes online banking almost as common as going to an ATM, the latter activity having been reported by 75% of Americans during the same period.
Of course, online threats are a big concern for the banking industry. Whether you’re talking about payment hacks like those that hit Target and Home Depot or the ransomware planted on your computer by criminals looking to steal your money, you’ve got to be careful out there. Here’s how to stay safe…
Opt for two-factor authentication
As you go about your business online — whether it’s logging on to your bank’s website or that of an e-retailer like Amazon — you leave enough info out there for criminals to misuse. To lessen the danger, many popular sites make use of two-factor authentication to safeguard their customers.
If you’re not familiar with two-factor authentication, it’s a process that requires you to go through an additional step to authenticate who you are when doing a transaction. It’s sometimes also referred to as two-step authentication.
The most common type of second-layer authentication is a security token (FSR token or fob that you carry with you). Many banks or brokerage firms will give you one of these devices if you call and ask for it. The security token generates a 6-digit code that changes every 30 seconds. So when you log in, you enter your username and password as usual and then also the latest six digits from your token.
Another way to have a second layer of authentication is to have a verbal password put onto your account. But note this well: Most financial outfits will *not* give you any prompt to remember your verbal password — so you’ve got to be sure you have it memorized!
Be careful of public Wi-Fi
Using a public source of wireless Internet can compromise your security under certain circumstances. The fact the network is open means someone with the right skills could compromise your security by snooping or planting malicious content on other machines attached to the same hub.
That said, it will always be better for you if the location’s Wi-Fi has beefed up security. A good indicator for that is if you need a password to get access.
But having a password doesn’t guarantee anything — which is why we have some tips that can help keep your information safe during your public Wi-Fi escapades.
Before you ever have to log in to a public hotspot, make sure your device’s software is up to date and use any extra layers of security your online accounts might offer. This would be something like two-factor authentication or security questions.
Having a virtual private network, or VPN, on your devices is also a good idea if you know you’re going to be using public Wi-Fi at any point in the future. But if you didn’t have the opportunity to plan that far ahead, go into your settings and try turning off file sharing. That can save you from unwanted connections.
When you’re looking for the right network to connect to, make sure you’re connecting to legitimate ones. So, not the one that says “free Wi-Fi” and doesn’t require a password.
After you’re on a safe public Wi-Fi source, pay attention to sites’ URLS. If you see “https” or a lock icon, that means the site you’re visiting is more secure thanks to an encrypted line of communication between your browser and the website.
When you’re done browsing, log out of the sites you signed in to. And forget the network, so the next time you’re in the area, your devices won’t automatically connect without your knowledge.
Set up double authentication on wire transfers
A common point of breach is when a criminal attempts to set up overseas wires from your account. Contact your bank and request double or dual authentication on any wires. That means a wire won’t automatically take place when someone requests it. The bank must take the additional step of getting a second go ahead from you — in writing, in person — before completing it.
Consider a dedicated computer for important financial transactions
The goal here is to eliminate the threat at the source. If you have a dedicated computer that you only use for financial transactions, that’s the best way to stay safe. No surfing the web on your dedicated computer. No e-mailing. And definitely no visiting Facebook or Twitter, as social media is one of the main entry points for hackers today.
This tip is especially important for small businesses. Under the current law, a business is not protected by a bank when a hacker breaks into a business account. So a business that you spent years or decades building — or even generations if it’s a family business — could be out of business overnight. If you have a breach and you can prove you took this extra step, you can show that you took “due care” under the Uniform Commercial Code (UCC). That may give you some legal wiggle room to get back some or all of your money.
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Use an antivirus program and keep it up to date
You know the saying: An ounce of prevention is worth a pound of cure. The best way to stay safe when doing online banking — or really any kind of online activity — is to use an antivirus program and keep it up to date.There’s a list of free programs in our Virus, Spyware and Malware Protection Guide.