Kerry K. Taylor   Jul 4, 2010 15 Comments

Onlinebank2 Banking online is an easy way to pay bills and move money without leaving the comfort of your sofa. With zero ATM line-ups and no traffic to navigate, it's easy to see why 54% of Canadians 16 and older opted to bank online last year. And the popularity of banking online is growing, says a recent Statistics Canada Internet Use Survey. But with the increased popularity of online banking comes increased criminal interest in finding a way into your account.

"It used to be all phone fraud, but now we're seeing the internet taking over," says Paul Proulx, RCMP Staff Sergeant and manager at the Canadian Anti-Fraud Centre. "We're seeing that especially in the last two years, and the trend is increasing."

[See 5 ways to scam proof your financial life]

Next time you bank online, try to keep these seven tips handy to protect your financial information from online fraud and identity theft.

1. Be aware of phishing.

Always be highly suspicious of emails requesting your bank account number or debit card PIN. Smooth criminals use a technique called phishing to masquerade as a bank and draw out, or fish for, your banking details. These sophisticated emails usually request personal information to 'update your account' or threaten to 'close your account' unless you click a link and provide your PIN.

[See 5 Ways to protect your pin]

If in doubt of the validity of an email, skip clicking the links and contact the bank directly using an advertised number. Also, always access online banking by typing the bank's web address directly into your browser.

2. Use an encrypted connection.

Before sending sensitive banking information online, "make sure you have security settings on your computer," says Proulx. To do this, check your web browser for an unbroken key or a locked padlock icon. A secure connection is also in use when the http part of the bank's Internet address changes to https.

3. Only bank on your personal computer.

Keep your account numbers, passwords, and PINs safe by only entering them on your trusted personal computer. Public computers may be running spyware programs that wait and watch for sensitive digits to be entered. These programs then report their findings back to the criminals who installed them, making you a target for online fraud.

4. Keep your computer secure.

Update your anti-virus, firewall, and anti-spyware programs regularly to protect your personal computer from all dubious Internet infections. If you bank online with a computer using Microsoft Windows, keep your operating system current by downloading software updates directly from the Microsoft website.

5. Avoid shared "coffee shop" networks.

Grabbing a quick coffee and checking your bank balance using a public 'hot spot' or Wi-Fi connection may pose several risks to the security of your online accounts. Public connections may not be secure or encrypted, and 'shoulder surfers' may be watching you enter your bank data from across the crowded room.

6. Check your bank's website.

Banks are often quick to update customers on phishing efforts and other fraudulent activities. When in doubt, look for security updates and warnings on your bank's website.

7. Log out after every session.

Don't walk away from your computer while you're actively banking and always log out of your web browser after each session.

If you think your account has been compromised, contact your bank for anti-fraud instructions. The article 5 Steps to take when your credit card is scammed gives some helpful tips.

Kerry K. Taylor writes at Squawkfox.com, a blog where personal finance is fun. Kerry is the author of 397 Ways To Save Money: Spend Smarter & Live Well on Less.

Your Turn: How do you stay safe while banking online? Have you ever dealt with online banking fraud?

: 10:26 PM in Banking
15 Comments

Always good practice to clear cookies after each banking session as well! If using Internet Explorer, Goto Tools on web browser, Internet Options, click on Delete under Browsing History, tick Temp files, Cookies and History, then press Delete button.
This will ensure that anyone using your computer cannot access your last banking session.

I always check my accounts on a regular basis, especially credit card accounts, looking for any activity that is not on my approved activity lists.
When travelling, I deposit funds into my Credit card account, in effect prepaying for everything. Hence, avoiding interest charges.

I cust and paste my user id and password when I log on to my bank account. This prevents software from tracking what you have been tying

Change your password every month

What about key logger scripts? The staff at my bank have not heard about them! Since the data from my keyboard to my computer is not encrypted, does it even matter that there is 128 bit encryption between my computer and the bank.

The Banks have all been sending me new chip cards,requiring a PIN number, saying this is to improve security. Since I have several bank cards, the only way I can remember the PIN number is to make them all the same. This is less security, not greater security. Am I missing something here?

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Don't just keep your anti malware stuff up to date regularly. SCAN regularly! I scan almost daily, but I'd say the average user could get away with a scan every week or 2.

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