Security with Online Banks and Online Brokers

Online banking and brokers are by far my favorite byproduct of the internet. Finding an online bank that allows you to pay your bills online for free, saves time and money. The post office has one of the biggest monopolies around. Competition in this area will drive up the interest your idle money will draw. Online brokers cut-out the middle man making it the best place for an informed investor to purchase stocks. (Unless you can purchase the stocks directly from the company itself.) Low commission costs greatly increase your long time return. These wonderful technologies bring me to the point of this article. "Online security" The only catch is you have to be extremely careful about security. As systems such as home PCs continue to get more complex, the ways in which thieves can break-into accounts increase. I work in the computer security industry so I am well aware of these threats. I suspect most people are obvilious to the risk. I've put together several common misconceptions.

Common misconceptions

• If your computer is patched and has an upto date anti-virus pattern you are protected.
• I don't use my computer much online so I don't have to worry about security.
• My bank protects me from identity theft and account theft.

My recommendations

• Use a second PC that has been cleanly built, patched, and utilizes upto date antivirus and spyware protection.
• Only use this PC for accessing your online bank, online brokerage and other online retailers.
• Do NOT browse to unknown sites with this PC. No searching. Do not install any unknown 3rd party applications. Only install necessary applications.
• Ensure there is a firewall between the internet and your secure PC.
• If possible, firewall off this PC from the rest of your home network.
• Use different complex passwords for all online accounts. Please see the definition of complex passwords for further information
• Store passwords in a secure hidden location such as a fire proof safe. Do not leave passwords sitting out. No sticky notes above your computer. Definitely do not store passwords on the computer.
• Check online accounts frequently.
• If possible, create online accounts as "For deposit only". Many online brokerages allow this feature.
• If possible, use 2-factor authentication. This involves something you know and something you have such as a key chain with a rotating 6 digit number.
• Be informed about how your specific online bank or broker handles identity theft.