What to Do About a Lost ATM Card

Smart consumers are careful to keep track of their cash and plastic cards that function as money. But suppose a wallet gets lost or stolen with a bank ATM card tucked away, seemingly safe inside. While some people might be tempted to wait and hope the wallet turns up intact, the wiser course is to take immediate action.

Here's what to do.

Report the Loss

The loss or theft of an ATM card should be reported as quickly as possible, according to George Joseph, president and CEO of Dade County Federal Credit Union in Miami. Most banks have a toll-free customer service phone number for this purpose.

"As soon as you know it's missing, you should notify your bank or credit union," Joseph says. "You need to do that immediately."

It's also a good idea to send a follow-up letter, with the account number and an explanation of when the loss was discovered and reported, according to the Federal Trade Commission. Unauthorized withdrawals or transfers also should be reported as soon as possible.

Liability Limits

A consumer's potential liability due to a lost or stolen ATM card depends primarily on how soon the loss of the card is reported to the bank, according to the FTC.

*If the loss is reported prior to any unauthorized activity, the potential liability is zero.

*If the loss is reported within two business days of discovery, the potential liability is capped at $50.

*After two business days, that amount increases to $500.

*If the loss isn't reported within 60 days after the bank sends out a statement, the consumer is responsible for all losses up to the balance of the account, plus the unused portion of any overdraft line of credit.

"Best-case scenario, they're not responsible for anything. Worst-case scenario, they're responsible for everything," Joseph says.

Some banks will reduce or waive a customer's loss as a matter of goodwill, according to Cary Whaley, vice president of payments and technology policy at Independent Community Bankers of America, a trade association in Washington, D.C.

A homeowners or renters insurance policy also may reimburse all or a portion of the loss, up to the policy limit, according to the FTC.

New ATM Card

Most banks offer replacement ATM cards at the local bank branch or by mail. Some provide free replacements; others charge a fee or allow customers a few free cards and then charge a fee for any more.

Customers who want to speed up delivery of a replacement ATM card usually have that option, according to Whaley.

"Almost every bank that I'm aware of has a process to expedite a replacement card. That may be for an additional fee, particularly if it involves something like Express Mail," he says.

Customers who lose multiple ATM cards may be encouraged to use other banking services, such as paper checks or an ATM card that doesn't include a credit or debit capability and carry a higher risk of loss, Whaley says. This type of ATM card could only be used to get cash or make deposits.

In the most severe cases, a customer may be cut off from ATM cards altogether. "It really depends on how much risk the bank or credit union is willing to take and how good of a customer you are," Joseph says.

Registration Services

Private companies known as registration services allow consumers to store and track credit, debit and ATM card numbers for a fee. Some of these companies will report lost cards and request replacements on the consumer's behalf, according to the FTC.

Whether these services are worthwhile is a matter of opinion. Those who opt for such a service should compare offers and read the contract to find out what's included.

Whether a bank will be willing to accept the word of a third party that purports to represent a banking customer is open to doubt.

"If we get a call from someone saying one of our members lost their card and they want one reissued, we will tell them to take a hike," Joseph says. "It's only more of a nightmare for you than to do it yourself."

PIN Protection

No advice about ATM cards would be complete without a warning about PINs, or personal identification numbers. The chief caveat, often repeated and just as often ignored, is to keep the PIN private, even from the bank's employees. Storing a PIN in an online or mobile application is "an absolute no-no," Whaley says. Starting out with a replacement card after a loss or theft is a good opportunity to develop the habit of memorizing the PIN and keeping it safe and secret.

"That's the major security you have, particularly for cash withdrawals," he says. "Don't write it on the back of your card. Don't store it in your online wallet right next to your card number. ... Don't tempt people."