Tips for Safe Banking Over the Internet
As use of the Internet continues to expand, more banks and thrifts are using the Web to offer products and services or otherwise enhance communications with consumers.
The Internet offers the potential for safe, convenient new ways to shop for financial services and conduct banking business, any day, any time. However, safe banking online involves making good choices — decisions that will help you avoid costly surprises or even scams.
We offer information and tips to help you if you are thinking about or already using online banking systems. We will tell you how to:
Confirm that an online bank is legitimate and that your deposits are insured
- Keep your personal information private and secure
- Understand your rights as a consumer
- Learn where to go for more assistance from banking regulators
Confirm that an Online Bank is Legitimate and that Your Deposits are Insured
Whether you are selecting a traditional bank or an online bank that has no physical offices, it’s wise to make sure that it is legitimate and that your deposits are federally insured. Here are tips specifically designed for consumers considering banking over the Internet:
Read key information about the bank posted on its website.
Most bank Web sites have an “About Us” section or something similar that describes the institution. You may find a brief history of the bank, the official name and address of the bank’s headquarters and information about its insurance coverage from the FDIC.
Protect yourself from fraudulent websites.
For example, watch out for copycat websites that deliberately use a name or web address very similar to, but not the same as, that of a real financial institution. The intent is to lure you into clicking onto their website and giving your personal information, such as your account number and password. Always check to see that you have typed the correct website address for your bank before conducting a transaction.
Verify the bank’s insurance status.
To verify a bank’s insurance status, look for the familiar FDIC logo or the words “Member FDIC” or “FDIC Insured” on the website.
Some bank websites provide links directly to the FDIC’s website to assist you in identifying or verifying the FDIC insurance protection of their deposits.
Also remember that not all banks operating on the Internet are insured by the FDIC. Many banks that are not FDIC-insured are chartered overseas. If you choose to use a bank chartered overseas, it is important for you to know that the FDIC may not insure your deposits. Check with your bank or the FDIC if you are not certain.
For insurance purposes, be aware that a bank may use different names for its online and traditional services; this does not mean you are dealing with separate banks.
This means, for example, that to determine your maximum FDIC insurance coverage, your deposits at the parent bank will be added together with those at the separately named bank website and will be insured for up to the maximum amount covered for one bank. Talk to your Labette Bank representative if you have questions.
Help Keep Your Transaction Secure
The Internet is a public network. Therefore, it is important to learn how to safeguard your banking information, credit card numbers, Social Security Number and other personal data.
Look at your bank’s website for information about its security practices, or contact the bank directly.
Also learn about and take advantage of security features. Some examples are:
- Encryption is the process of scrambling private information to prevent unauthorized access. To show that your transmission is encrypted, some browsers display a small icon on your screen that looks like a lock or a key whenever you conduct secure transactions online. Avoid sending sensitive information, such as account numbers, through unsecured email.
- Passwords or personal identification numbers (PINs) should be used when accessing an account online. Your password should be unique to you and you should change it regularly. Do not use birthdates or other numbers or words that may be easy for others to guess. Always carefully control to whom you give your password. For example, if you use a financial company that requires your passwords in order to gather your financial data from various sources, make sure you learn about the company’s privacy and security practices.
- General security over your personal computer such as virus protection and physical access controls should be used and updated regularly. Contact your hardware and software suppliers or Internet service provider to ensure you have the latest in security updates.
If you have a security concern about your online accounts, contact your bank to discuss possible problems and remedies.