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Capital One breaks exposed account numbers for the most economically vulnerable customers



The bank and the US Department of Justice on Monday revealed that a hacker was able to access private data for more than 100 million Capital One customers. Social security numbers, credit card applications, home addresses, credit points, credit limits and balances were exposed.

The trope of data also included 80,000 bank account numbers, all for secured credit card customers.

Such credit cards are usually held by consumers with low credit points or no credit history at all. This means that many of the 80,000 customers may find it difficult to recover from an identity theft if their exposed data is used to be ill.

It is not yet clear if anyone's identity was stolen as a result of Capital One ( COF ) violation. The company said that the vulnerability that allowed the hacking, which happened in March, is resolved and that it is "unlikely that the information was used for fraud or dissemination." Capital One said it is still investigating.

What this means for secured credit card customers

Secured credit cards are meant to help people build or rebuild credit: They are offered people with a FICO score in the mid-600 and above who probably have no other credit options. The banks require cardholders to deposit cash equivalent to part or all of the card's credit limit before they can start using.

Many consumers who choose a secured credit card are recovering from a personal crisis, such as a medical emergency, divorce or sudden unemployment that hampered their credit score, said Beverly Harzog, a credit card expert and analyst at US News & World Report. Immigrants and young Americans who do not have a credit history can also use the cards as a starting point. And people who ruined their credit scores with reckless spending can use a secured card to help them get back on track.

In short, the typical secured credit card customer is someone who "very sincerely tries to understand" how they can improve their financial position, Harzog said.

But that hard work could go up in smoke for the 80,000 Capital One secure credit card customers to whom the information was exposed during the breach.

If their data goes into the wrong hands, a fraudster could clear the victim's checking or savings account. Fortunately, according to CyberScout founder Adam Levin, most banks will restore stolen funds to victims' accounts within ten days. But for a seriously cash-strapped person, 1

0 days can still lead to a major disruption if bills are due or the refrigerator is near empty.

And it could be worse: The Capital One secured cardholder identity number may also have been exposed to the breach, and identity theft could ruin a credit score.

Criminals only need social security numbers and a few other key pieces of personal information to cause serious harm. They can repair medical bills under someone else's name, open new credit card accounts and never pay the bills, or even take another mortgage in a victim's home.

Setting the record right after an identity theft can "become almost a full-time job for an extended period of time," Levin said.

Harzog, the credit card expert, said it's especially important for secured credit card customers to take Capital One up by offering free credit monitoring and identity protection. Experts also recommend that affected people pay close attention to their credit reports for all unexplained activity, look at their bank statements for unknown expenses and even freeze credit to stave off fraud.

And, Levin warned, if it seems like a scammer would be less likely to impersonate someone with a bad credit score – think again.

"To a hacker, you are Kim and Kanye because you have what they want: data," he said.


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