If a Bank Says Don’t Worry, Worry

Don’t worry, the bank told me when it froze my debit card after a thief managed to drain a couple thousand dollars from my account.

Here’s a consumer tip: When your bank says don’t worry, you should begin worrying. What I’m about to tell you is a cautionary tale, so pay close attention, and with any luck, you won’t get ripped off like I did.

My bank’s friendly customer service rep explained by phone that the stolen funds would be restored to my account while the bank conducted an investigation.

Sounded great, and indeed, the funds were restored. But how had the money been withdrawn from four different ATMs, at $500 a crack, if I still had my debit card?

Someone might have managed to steal my PIN number and create a bogus card, the bank explained.

As I would later learn from the U.S. Secret Service, local police and the Identity Theft Resource Center, the business of ATM fraud is booming. Crooks are using video cellphones, surveillance cameras and old-fashioned shoulder surfing to eavesdrop on you while you punch in your PIN. On top of that, there’s an occasional inside job in which a crooked bank employee swipes the information.

My thief was a busy little derelict. In four days ending Nov. 3, he managed to hit the jackpot at ATMs in Van Nuys, North Hollywood, Sun Valley and Lancaster.

As instructed, I filled out the necessary forms and even called my bank to say I had a hunch where the original theft might have occurred. I’d had a suspicious encounter at a gas station, where a clerk watched me try to use a pump that had rejected my card. Within a few days, my account was tapped.

Four weeks after filling out forms, my bank sent me a letter.

“After conducting a thorough investigation ... it has been determined that ... the transaction activity in question was authorized and posted correctly to your account. Therefore, the temporary credit for $2,020.50 that was previously applied to your account will be reversed on December 16, 2005, thus closing this dispute.”

First I had steam coming out of my ears. After a few minutes, my head caught fire.

And that was before I read the following line:

The bank “appreciates your business and values you as a customer.”

The reason I’m not divulging my bank’s name -- as much as I would love to -- is that it wouldn’t be right for me to use the influence of the newspaper to get my money back. The average Joe can’t do that. And besides, I want to see if in the end, my bank (a large national operation that will no longer have my business when this is over) does the right thing for the right reasons.

The day I got the letter, I called the bank’s debit-card operations office and screamed at someone, telling him they might as well have sent me a letter calling me a liar and a thief.

What exactly did their “thorough investigation” consist of? I asked.

The lackey on the other end of the line claimed bank investigators had called me, and I hadn’t returned their messages.

Are you kidding? I asked.

Do you really think that with $2,000 on the line I’d ignore inquiries into the theft?

Nobody called me, I told him. You’d think they’d at least have been interested in the gas station I told them about, since it’s possible that lots of people are getting swindled there. And you’d think they would have checked the videotape at the ATMs where this punk drained my account.

Sorry, the knucklehead told me, but because of privacy considerations, they can’t always get access to those tapes.

I calmly advised this lad to get up from his desk, head for the door and go get himself a good stiff drink. Then go back to the office and quit, I told him. You can’t keep working for these people and ever hope to feel good about yourself.

To his credit, he told me he didn’t disagree with a word I had said.

My wife, who was getting worried about the direction of the conversation, asked to speak to the guy.

I handed her the phone, and the guy told her I had every right to be angry. He also suggested I go to the Los Angeles Police Department to file a theft report and send it along. Maybe that would help.

I went to the Northeast LAPD station on San Fernando Road, where the desk cop was helpful and more than sympathetic, telling me he’d been a victim of identity theft himself.

Ditch the debit card, the cop advised, and use a credit card. If you get ripped off, the law makes it the credit card company’s loss, not yours. He said he’d seen lots of victims, too, and accused derelict bankers of leaving basic investigative work to customers and police.

When I called Det. Bob Berardi of the Los Angeles County Sheriff’s Department’s identity theft task force, he told me that he’d been victimized twice, including once while he was in Las Vegas giving a speech on identity theft.

Nice to know I’ve got so much company.

When I called, Berardi was writing a report that said the Sheriff’s Department had 6,198 identity theft reports in 2005. Get a shredder, he advised, and destroy all documents before dumping them into your trash.

Thieves operate alone or in rings, Berardi said, and gas pump scams are common. In some cases, he said, a cashier will use a small “skimmer” to read the information on your debit card, or a skimmer will be attached to the ATM device on the gas pump.

When you punch in your PIN, said Don Masters of the U.S. Secret Service’s Los Angeles office, the guy behind you who appears to be on his cellphone may instead be videotaping you. Or the surveillance camera in the gas station mini-mart might be pointed at the ATM keypad.

“It’s a lot safer and more productive to use ID theft and credit card fraud than to go out and rob a bank,” said Masters. He said that a stolen PIN, along with the information skimmed from a magnetic stripe, can be used to produce counterfeit cards on plastic blanks that are easily purchased.

“They can do all that working off a laptop computer,” Masters said.

What makes you nuts is that despite such sophisticated scams, the banks’ attitude is that if someone snatches your PIN, it’s your fault, and the loss is your responsibility. In 2001, the U.S. Office of the Comptroller of the Currency, which regulates national banks, scolded them for rejecting claims of ATM fraud when customers couldn’t prove that withdrawals were unauthorized.

“These are the games the banks are playing,” said Jay Foley of the Identify Theft Resource Center (www.idtheftcenter.org), which alerts consumers to scams and advises victims how to get their money back.

He asked if I’d sent my police report to the bank by certified mail.

No, I said.

He predicted I wouldn’t hear back from the bank, and when I call to find out what happened, someone would say they never received the letter.

“Then they’ll ask if you sent it certified mail,” he said.

For their next trick, Foley said, the bank will argue that it received the certified mail, but the claims window is closed.

“They know the rules, and consumers don’t, and they have no qualms about reciting the rules when they work to their advantage,” Foley said.

John Hall of the American Bankers Assn. told me a case like mine is rare, making me wonder if the guy has any idea what he’s talking about.

I told him I’d bumped into one identity theft victim after another and reminded him how the Comptroller of the Currency had come down on banks for rejecting claims.

Hall said banks eat the loss 99% of the time, and it costs them millions.

If that’s true, and I have my doubts, it doesn’t make me feel any better about being in the 1%.

Call my bank and lay out my case, Hall advised.

Wow, there’s a great insider tip. Thanks, I told Hall, but I already did that.

Call them again, he said.

How many times should I have to call?

“I don’t know,” he said. But “you need to resolve it with them.”

I’ll tell you what: If this guy’s current job doesn’t work out, I’m sure he can get an executive job with my bank.

Reach the columnist at steve.lopez@latimes.com and read previous columns at www.latimes.com/lopez.