You have to have a bank account these days. Without a bank account of some form it's almost impossible to participate fully in our economy. You can't buy anything which costs more than what you have in cash, be it a house, a car or even a mattress. You can't borrow money from an institution. You find yourself constantly paying through the nose for things like check-cashing fees, a predatory practice which most Americans are privileged never to encounter. And you certainly can't write checks of your own.
It turns out, however, that you probably shouldn't write checks of your own - even if you have a checking account. The organization in charge of processing check payments says so explicitly: "stop using paper checks," they wrote, in a statement to Fusion.
Why would they say such a thing? Well, having a bank account does comes with its own set of problems. As Sarah Jeong painfully discovered a few weeks ago, bank accounts simply aren't set up for how we live today - which is to say, online--and can easily be compromised so that our hard-earned dollars wind up going to pay someone else's expenses. One morning, Jeong woke up to discover that her bank account had been emptied by someone named Michael who had used it to pay off various credit cards online. Jeong's bank told her that Michael had been able to do this because he had her bank account number and routing number. Writes Jeong in Motherboard:
I cannot count the number of times I've freely given out my routing and account numbers--in emails, in webforms, in paperwork. This is because it's necessary for other people to know my routing number and account number in order for them to send me money. But apparently, with that same information, they can also snatch money straight from my account. What kind of insane system is this?
There's two factor authentication, there's one factor authentication, and then there's this, which I think I can call zero factor authentication.
Is Jeong really right? Can anybody, anywhere, just spirit money out of your bank account, armed with nothing more than the information on the front of every check you write?