Proactive Security - Part 3: Financial Transactions

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Precautions for important financial transactions

I always use a separate, secure computer for online banking and other critical financial transactions. In one location it's an old PC updated to Windows 7, and in another an even older PC running Windows XP.

Of course I use the security setup I've outlined in Part 1 and Part 2 on both of these computers.

A second computer may not be practical though. A live CD makes a good alternative to  a separate computer. You just boot Linux from the CD instead of booting Windows from the hard drive. This solution works fine if your bank's website works with Firefox. Most of them do, but there's no IE available for Linux.

You can use TrueCrypt to encrypt any records you want to store. You could store the encrypted volumes on a flash drive, in online storage or just email attachments . You could even create a Linux partition your hard drive and use that. 

The article at How-To Geek is just one of the good places where you can get started with live CDs.

I also encrypt all the passwords and financial documents that I store on those on those computers. I use TrueCrypt, but there are alternatives. TrueCrypt lets me go one step further and use Portable Firefox from within the TrueCrypt volume (encrypted container) so that no temporary files containing personal details are ever exposed.

Cyber-muggers love to booby-trap bank, broker and other websites where they can steal important passwords, etc. So I implement the precautions outlined in the parts 1 and 2 of this security plan — good security software, keeping Windows patched, etc. — even though I never use my "green" computers for anything but important business.

By the way, there's a serious "gotcha" to watch out for if you use a router. Computers normally trust other computers connected to the same local area network. That means your secure computer could be attacked by any other computer on the LAN — say a guest computer connected by WiFi, or one connected by Ethernet that is used for wide-ranging adventures online. ;-)

Unless you know how to set up your router or the firewall of your secure computer so that you're absolutely sure it is blocked from any and all other computers on your local network, turn them off or disconnect them from your network before you start the secure one. Windows 7 makes it easy to block other computers if you don't need to network between them.

Credit card precautions

I don't trust most online entities with my credit-card details. Millions upon millions of credit cards are compromised each year through attacks on large and small retail and financial entities. There are only a few places where I put my credit-card information at risk, and then only when I have some confidence in the entity, and it's too clumsy to do otherwise.

I use PayPal for most online payments instead. Many online retailers, etc., accept PayPal payments directly. For those that don't, you can get one-time, one-place credit card numbers with a PayPal Plug-In. You can also get one-place, multi-use numbers from them for recurring payments. You're protected from third parties. Some banks and credit-card issuers offer similar services.

By law, credit cards are well protected (debit cards aren't, but some banks protect you anyway). Card issuers are anxious to keep you hooked, so you're not likely to lose money from credit-card fraud. You can still be greatly inconvenienced if one of your cards is compromised though. For example, credit card details can be used as the first step in identity theft. :-(

More on the web about secure PC precautions

How to avoid being robbed by your PC

Consider Linux for Secure Online Banking

Avoid Windows Malware: Bank on a Live CD

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