It's well known that credit cards are safer to use than debit cards. If your credit card is compromised, you just report the fraudulent charges to the issuer. No money is removed from your bank accounts. However, with a debit card, money is removed from your checking account. If it's a fraudulent charge, you have to fight to get your money back.
This article from The Plain Dealer describes the hassles that you may have to go through if you're a victim debit card fraud:
While many consumers get most of their money back in debit card fraud cases, they generally have to wait seven to 10 days while the bank investigates.
Further, in the typical case of debit card fraud, consumers spent 28 hours making phone calls, dealing with their bank and filing police reports, to get the problem resolved
When a Debit Card and PIN Are Stolen
The typical debit card fraud doesn't involve a PIN. If a thief acquires your PIN, it can become much harder to get your money back. There was a news story this week at my local Florida news station which described the problem a lady experienced with Wells Fargo when her debit card and PIN were fraudulently used. Here's the video of the story.
Her adult grandson stole her debit card and PIN and went on a spending spree charging over $900 and causing over $300 in overdraft fees. Wells Fargo refused to reimburse her even after she filed a police report on the theft. Wells Fargo claimed she had authorized the charges since the PIN had been used. It wasn't until the news reporter contacted Wells Fargo that they agreed to refund her the stolen money and cancel the overdraft charges.
The important lesson from this news story is to avoid disclosing your PIN to anyone including family, and don't write down your PIN. Also, it's important to remember that you are not responsible for unauthorized charges. Make sure you quickly dispute any unauthorized charges with your bank, and if the bank refuses to provide a refund, file a complaint to the bank's regulator.
Coincidentally, TBS ran the Seinfeld Secret Code episode yesterday in which George refuses to divulge his ATM PIN to his fiancée. It's rare to have this much trouble in keeping your PIN a secret :-)