Protect Yourself from Aggregator Fraud
Minute Read
Aggregators can offer convenience by consolidating information from multiple sources, making it easier to access and manage. However, they can become a risk if the data they collect is compromised. It is crucial to make sure you take the necessary steps to protect your data as the first line of defense.
What is an online account aggregator?
Online account aggregation is the process of bringing together your financial information from different account sources into a single place. It enables members to connect, view and manage savings accounts, checking accounts, investment accounts, credit card accounts, mortgages, insurance policies, health savings accounts, flexible savings accounts and any other applicable accounts to provide a comprehensive picture of financial data. Account aggregation creates fast, convenient and automated account access without the need to manually log in to and check each individual account.
To provide a complete financial overview, account aggregators typically employ one of two methods:
- An application programming interface (API) where data is securely transferred directly from your financial institution.
- Screen scraping which involves granting the aggregator access to your online banking credentials to retrieve account information.
Some popular aggregator apps you might be familiar with are:
- Finicity
- Yodlee
- Plaid
- Stripe
- Intuit
So, what is the risk?
Consumers may not realize that when sharing their financial credentials with an account aggregator:
- They are granting access to a third party, not directly to their financial institution.
- They are storing all their financial information in one place, which can increase the risk of security breaches on individual accounts if the aggregator is hacked.
- Their financial data could be saved, shared or used beyond their initial consent.
- Screen scraping allows aggregators to collect more data than necessary for the requested service, potentially compromising sensitive information.
The rapid growth of financial technology companies has led to increased reliance on data aggregators for convenient access to financial information. Consequently, these aggregators have amassed vast amounts of consumer financial data, often with insufficient safeguards in place. This accumulation of sensitive information without adequate protection raises significant concerns about unauthorized data breaches and potential fraud.
Tips to Protect Your Personal Information and Assets
- Do not reuse usernames and passwords on multiple websites and apps.
- Sign up to receive account and security alerts via text or email on all your bank, investment and credit card accounts. Stay on top of your account balances and pay attention to notifications of activity on your account.
- Exercise caution when authorizing a third party to handle your payments. Always verify that funds are being sent to the correct recipient.
- Carefully review any agreements you sign that allow third-party access to your financial accounts. Understand exactly what permissions you’re granting regarding your financial data.
- What data can they access and for how long?
- Can they sell your data to another third party?
- Do you know how to cancel your account and terminate access rights?
- Conduct thorough online research on any data aggregator or third-party service provider before using their services. Check for customer reviews, complaints or legal issues.
- Regularly check your accounts for any unauthorized transactions, including any debits from your account that you did not make or recognize. If you see something, call us or visit a branch right away.
Your best defense against falling victim to fraud is to use these tips and stay vigilant. When in doubt, give us a call at (800) 826-4314 or visit one of our nearly 60 branch locations.
