University Federal Credit Union

Students need to pay closer attention to protecting their personal finances and identity online. Independent research released in 2013 concludes that a person’s identity is compromised every three seconds, and according to the Better Business Bureau, college students are at the greatest risk for identity theft. 

Months before coming to UT, I opened up a debit card. It was the first step to managing my own money and financial aid — relative financial independence and all that good grown-up stuff. After a few years fostering a habit of swiping cards and entering numbers, I received a voicemail.

“We would like to verify some recent transactions,” the automated voice started off, claiming to be my bank. For a long minute, I wondered if it was a hoax. Skeptical, I called member services only to learn that someone had attempted to charge thousands of dollars’ worth of online game credits to my debit card through Facebook, of all places. Just another college kid, I only had around $30 in my bank account, so naturally, the gaming bonanza was denied. I asked myself how my information could have been compromised, considering I’d never paid for anything on a social network. And offhandedly, I wondered how desperate someone else could be, just to get to that coveted next level of Candy Crush.

Based on the amount of personal information listed on paperwork and this generation’s Internet activity, college students are understandably common targets of identity fraud. It’s impossible to track where all your information is headed or stored. Yet the accumulation of personal details found online, including simple identifiers like name, date of birth and location, can easily put a person’s privacy on the line. 

Kimberly Smith, government and  African and African diaspora studies senior, has been a victim of debit card and social security fraud on two separate occasions. For Smith, the claim that college students are more at risk would not have held up as well before the Internet supported online shopping and social media. “I think younger people are definitely more vulnerable in general,” Smith said. “Clean credit histories, generally not detail-oriented, often unaware of their financial picture.” 

Using auto-debit services and ignoring emailed bank statements come to mind as examples of how online convenience does not always equal vigilance. Smith also points out how traditional college students tend to have better credit lines than other peers of the same age because of their resources and ability to spend. So if we’re easier targets, what should we avoid?

Located next to the Co-Op, the University Federal Credit Union’s Guadalupe branch regularly serves the UT community and, more often than not, handles the unfortunate cases of compromised accounts. UFCU Financial Representative Timothy Diamond says he sees more fraud cases than he would like and observes how most originate from either gas stations or online. “There’s two different reasons behind the two different sources,” Diamond said. “At gas stations, there may be something called card skimmers. You swipe your debit card and enter your PIN, and if there’s a card skimmer there, that’s how someone can get your card information.”

Recent journalism graduate Maribel Molina says she’s had to change her card on three separate occasions.“Each time has been because my card was compromised,” Molina said. “I randomly had charges from department stores out of state.” Molina suspects skimmers could have been involved and says the experience made her start looking at where and how her cards are swiped. While there could be signs of tampering on a card reader, it’s not always easy to tell whether a card skimmer, an identity thief’s best friend, is installed. Try selecting the credit option even when a debit card is in use. Instead, a zip code is requested for verification in place of your much more valuable PIN number.

Back online, however, is murkier territory, where websites have access to addresses, checking accounts and contact information which they requested and was provided. The customer must then trust that information is and will remain safe. “Only shop at trusted retailers” seems to be the best advice from banks, but even in-store transactions can be at risk, as seen with Target and Home Depot. Maybe the most we can control are our own practices. So how can we develop better habits and start to spend smarter?

The Center for Identity at UT Austin aims to encourage identity management, privacy and security for the general public. The Center recently secured $5 million — the largest investment made at the state level in identity research nationwide — with support from Texas Comptroller Susan Combs. In April, the Texan reported on the Center for Identity’s plans to use the funding toward a resource center slated to open over the summer. The project’s release was pushed to October to create an infrastructure and develop promised features, like toolkits and mobile apps. “October is actually Cybersecurity Awareness month,” said Anna Griffin, communications and public affairs coordinator at the Center for Identity. “For us, the timing and the topic seemed to make sense.”

Now called IDWise, the resource center is actually housed online, and is set to launch Tuesday. IDWise will provide expertise on protecting sensitive information for anyone, especially those who make common targets: college students, small businesses and senior citizens.

After researching my own personal transactions and the subject of identity theft, the mystery of how my information was compromised remains unsolved. This experience was obviously disturbing and before, I would have described myself as overly cautious with my account information, refusing to even use some smartphone apps in case of loss, or not logging in through unsecured Wifi connections. Still, it wasn’t enough to stay secure.

A warning sign, according to UFCU, would be a questionable item on an account’s pending purchases list, most likely made in small amounts like $1, to test if larger fraudulent transactions will go through at a later time. A reminder to check account balances regularly and keep track of your purchases also shouldn’t go unheeded. As a preventive measure, I opened up another checking account especially for online or high-risk purchases. Hopefully, that provide some peace of mind in the future. 

Life doesn’t stop because of one incident of identity theft, but as young people developing our financial health, we should take these cases more seriously as a reminder of what other personal, sensitive information could be exposed. One can never be too careful with a name or hard-earned money, which, despite what our less-than-careful actions suggest, seem to be two things college students care about the most.

Piedad is a journalism junior from San Antonio. Follow her on Twitter @janjourn. 

UT students will be participating in Bank Transfer Day Saturday, where they will close their accounts at commercial banks and open new ones at local credit unions.

While Bank Transfer Day is not officially affiliated with Occupy Wall Street, its goal has garnered support from the movement and the protesters in its satellite occupancies.

The planned event comes after commercial banks announced new and increased service fees for their customers. Kristen Christian, a Los Angeles-based art gallery owner, created the Bank Transfer Day event on Facebook in response to imposed fees and poor customer service from Bank of America.

Credit unions, like the University Federal Credit Union, are usually smaller and locally based. Commercial banks like the Bank of America are financial corporations with branches across the world.

Bank of America announced plans in September to start charging customers $5 a month when they use debit cards to make a purchase. Within days, Citi Bank raised the monthly maintenance fee on its mid-level checking account to $15 a month from $7.50 a month and upped the required minimum balance of linked accounts from $6,000 to $15,000.

After a month of public outcry over the new fee, Bank of America dropped proposed plans to charge debit usage fees Tuesday.

These debit fees are in response to legislation passed earlier this year that imposed a federal cap on debit card “swipe fees,” or the fees charged to retailers by major banks every time a customer pays with a debit card. The legislation capped those fees to 21 cents per transaction from a previous average of 44 cents.

Last year, congressional legislation also required banks to give customers the option to have transactions declined instead of being charged overdraft fees.

To recoup those lost revenue streams, the Wall Street Journal predicted earlier this year, banks would start charging for services.

UT’s own Occupy satellite will be participating in Bank Transfer Day. Headed by rhetoric and writing assistant instructor Trevor Hoag, the group consisting of 35 Facebook-confirmed participants will be walking down Guadalupe to the Bank of America, Wells Fargo and Chase branches to close their accounts Saturday morning.

Hoag said he transferred to the University Federal Credit Union, which is based in Austin, two weeks ago after learning that they offered the comparable services to what he was receiving at Chase. He also said that UFCU was the more ethical banking option for himself.

“Credit unions weren’t complicit in the bailout and they weren’t complicit in the predatory lending,” Hoag said.

The past month has seen bank transfers similar to Hoag’s. According to a poll conducted by Independent Community Bankers of America, 60 percent of responding independent banks saw an increase in new account openings.

That movement of consumers is happening in Austin as well.

UFCU spokeswoman Sheila Wojcik said at the three branches in the central Austin area, the number of new accounts opened in October was twice their original projection.

“People directly said in many instances that they were transferring from a big national bank like Bank of America,” Wojcik said. “We have seen an impact.”

Senior finance lecturer Regina Hughes said the primary difference between credit unions and commercial banks is the ownership.

Hughes said commercial banks, like Bank of America and Wells Fargo, are for-profit entities owned by shareholders. Credit unions are controlled by its members, who directly make policies for other members and are not necessarily looking to make a huge profit. They also do not provide the same variety of services, such as types of investments, offered by major commercial banks. Commercial banks, she said, are corporations that invite people to become customers, but their goals can be different and separate from those customers.

The services offered by credit unions are enough for architectural engineering and philosophy sophomore Kathleen Hetrick, who said she will be participating in Bank Transfer Day.

“This doesn’t have anything to do with capitalism. It has to do with companies not functioning right and stealing from people. It’s a morality issue almost,” Hetrick said. “I can’t really do too much about the bank structure itself, but I can take my money out of their bank.”

Published on Friday, November 4, 2011 as: Students to switch accounts on first Bank Transfer Day