PSA: Scottrade hacked, customer data stolen

[Chad]

I would think a higher priority is having a strong password and a broker that uses dual factor authentication. Though, I do have mine split between two brokers. Both with dual factor authentication. I'm not sure splitting up much more is a good idea, as you quickly start hitting your memory limit of strong passwords.

It also doesn't hurt to have brokers that email or text you when a transaction occurs.

The real danger seems to be scams and con artists using your data to try and trick you to get access to your account, as opposed to them brute force breaking everything and stealing the money in a direct cyber attack.

[SimpleLife]

Are these accounts FDIC insured? Up to 250K? Even against loss as a result of hacking?

[Noided]

Are these accounts FDIC insured? Up to 250K? Even against loss as a result of hacking?

In the case of fraud, don't companies have to legally restore all your money? Off course they could go bankrupt, that is another story.

[fiby41]

Serious question I can't gnaw out -- Is it better to have all of your money in one place to limit your exposure to hacks? Or is it better to spread your money around in different places to prevent a successful hacker from getting all of your money, even though you're more exposed to smaller hacks?

Wouldn't the latter require having separate credit card accounts with different personally identifiable details to work?

I am novice in this area atleast until I turn 18 after which I will reapply for an account with the Income Tax Department which will in turn allow me to create an online brokerage account.

[George the original one]

Serious question I can't gnaw out -- Is it better to have all of your money in one place to limit your exposure to hacks? Or is it better to spread your money around in different places to prevent a successful hacker from getting all of your money, even though you're more exposed to smaller hacks?

If you take it that hacking (or insider fraud) is inevitable, then it depends on the frequency of such thefts. In other words, it's like betting on the roulette wheel... you can choose red/black at 1:1 or you can choose a number at 33:1. But if the house is paying 5:1 for red/black or 150:1 for a number, then that's the way you'll go. Only it is more complicated because you don't know the odds.

[George the original one]

Are these accounts FDIC insured? Up to 250K? Even against loss as a result of hacking?

In the case of fraud, don't companies have to legally restore all your money? Off course they could go bankrupt, that is another story.

No, they aren't FDIC insured. There is a group that insures the accounts in the event a broker goes bankrupt, but that insurance doesn't cover fraudulent activity. Just like FDIC isn't going to cover your money if someone else gets hold of your bankcard and performs unauthorized withdrawls.

[SimpleLife]

Are these accounts FDIC insured? Up to 250K? Even against loss as a result of hacking?

In the case of fraud, don't companies have to legally restore all your money? Off course they could go bankrupt, that is another story.

No, they aren't FDIC insured. There is a group that insures the accounts in the event a broker goes bankrupt, but that insurance doesn't cover fraudulent activity. Just like FDIC isn't going to cover your money if someone else gets hold of your bankcard and performs unauthorized withdrawls.

So who then pays the cost of the reimbursement I get from Bank of America every time my credit card is fraudulently used online? It's happened probably 4-5 times in the past 7 years.

[Chad]

The bank. Though, the banks are pushing through a new system that puts the onus on the merchants. The difference is they didn't steal any assets from you. Those are the banks assets they are stealing (soon to be the merchants) when it's a credit card. Those are your assets they are stealing inside your bank/brokerage account.