How to protect yourself from fraud by your own bank

We often worry about having to monitor our bank and credit card accounts from identity theft or outside fraud. But no one ever warned us about having to worry about and monitor our accounts for bogus activity from the very institutions with which we do business.

In the wake of the Wells Fargo Bank being hit with $ 185 million in civil penalties for secretly opening millions of unauthorized deposit and credit card accounts that harmed customers, now we do.

So, what’s the best way to protect yourself from this sort of fraudulent activity? uMonitor, monitor, moni

tor. Regularly monitor all of your accounts for indications of unauthorized fees, says Steve Weisman, a professor at Bentley University author of the Scamicide blog.

“Ultimately, the fees lost to this particular scam came out of legitimate accounts of the victimized customers and would have been apparent upon a careful examination of their monthly statements,” he says.

Others agree. “In these days of increased electronic correspondence when many institutions have cut down on paper statements as much as they can, it’s important that consumers are vigilant in checking their financial statements from their banks, retirement accounts and any other place where a financial transaction can take place,” says Amy Nofziger, a spokeswoman from AARP’s Fraud Watch Network.

Beware pending charges. Fraudulent charges are often on the books as “pending charges” for a period of time, says Kathleen Sindell, CFP chair at the University of Maryland University College and author of Social Security: Maximize Your Benefits. “This gives the thief time to steal the money and replace it before the charge is finalized.”

Don’t disregard small charges on bank and credit card statements. “Customers who want their money replaced often have to complete a form and have it no- tarized and returned to the bank,” says Sindell. “If the theft is for a small amount of money, the customer may forgo claiming the funds. The robber wins and the customer has the inconvenience of getting a new credit or debit card. In terms of daily business, the old credit card number disappears.”

uAsk your bank to do a Social Security/ name check. Geoffrey VanderPal, a certified financial planner with VanderPal Capital Management, suggests that you periodically ask the fi- nancial firms with which you do business to do a Social Security and name check to see what accounts may be opened or closed based upon your identifying information.

uSecurity freeze. Also, to help prevent fraud in general, VanderPal recommends placing a freeze on all three main credit bureaus as well as some secondary credit bureaus and Chex Systems, which reports banking information and about 85% to 90% banks subscribe to. Placing a freeze on your credit report prevents lenders from accessing your credit reports.

uDon’t put your trust solely in monitoring services. “It is questionable whether these services would pick up on the new accounts set up in your name, such as online banking services for your own account at your own bank,” says Weisman.

JON FEINGERSH, GETTY IMAGES You are your own first line of defense against bank fraud.