Don’t Get Burned by the Home Depot Credit Card Breach

Headlines have been full of company's who data systems have been hacked and customer credit card information stolen. Most recently it has been Home Depot customers that have been compromised. Below is a  timely blog from a colleague, Matt Pearce, Rome, GA Small Business Development Center, that addresses how this recent breach can impact small business owners:

As I was driving home yesterday, I heard radio host Clark Howard mention a couple of numbers related to the Home Depot credit card breach:

• Approximately 56 million credit and debit cards may have been compromised.
• 40% of these may be small businesses, contractors, etc.

Clark made the point that business credit cards do not get the same fraud/theft protection that consumers enjoy.  It got me thinking about what this meant for business owners and independent contractors who have done business with Home Depot during this time period.  So, I called a banker I had previously done business with to get his perspective.

Generally, a business has 30 days to report fraudulent charges to its bank.  Consumers have 60 or more.  If you see fraudulent or questionable charges on your business credit or debit card, contact your bank to start the process of disputing the charges.  In this way, it is similar to the fraud protection you have on your personal credit and debit cards.

The main difference is that there is an expectation that a business will exercise more “due diligence” in monitoring its banking activities, compared to the typical consumer.  If you haven’t been doing so already, go back and check your credit card and debit card statements for any unusual, unexpected, or just plain weird, transactions.  If you have employees with business credit or debit cards, make sure you check those statements too.

Home Depot says this was going on for five months – so go back to April 1, 2014.  In theory, if you did not have any Home Depot charges on your account during this five month period, you should not be at risk for this particular fraud.

Next, you should continue to check your credit and debit card statements on line at least once a week for the next couple of months.

Your bank may issue you a new credit or debit card.  J.P. Morgan Chase and Capital One have already indicated that they will be issuing new cards to customers, according to an article in today’s Wall Street Journal.

I mentioned above that you should check your bank statements on line weekly.  This would be a real good habit to get into permanently.  It is part of what accountants call “Internal Controls.”  Internal controls simply mean that you, the business owner, are making sure that you know where your money is coming from and where it is going.  It starts with reviewing your bank accounts on a regular basis.

Good advice to take! Questions, comments or concerns? Please leave me a post!

Laura Katz, MBA, is a Consultant at the University of Georgia Small Business Development Center and specializes in marketing and business development. Ms. Katz can be contacted at: 706.542.7436 or lkatz@georgiasbdc.org.