Online broker Charles Schwab Wednesday issued a guarantee against any and all losses from unauthorized account access, the latest online trader to calm customers' jitters about phishing scams and identity theft.
As of Wednesday, all Schwab customers are 100 percent covered against loss, the San Francisco-based company said. They need take no action unless they suspect that their account has been accessed without their permission or knowledge, Schwab added.
"It has always been our practice to make clients whole in cases of unauthorized account activity. Our new security guarantee turns that historic practice into a public promise," said chief executive Charles Schwab in a statement. "Given rising public concerns over identity theft and cyber-fraud, we think adding a clear and simple guarantee will contribute to even greater peace of mind for our clients."
Schwab follows rivals in posting a guarantee; in January, New York-based ETrade launched what it called "Complete Protection Guarantee" to cover all losses originating from fraud.
Banks, online brokers, and other financial institutions have been worried of late about fraud in general and identity theft in particular, as online users have turned skittish in reaction to a rise in e-fraud. Several polls taken in 2005, for example, noted that U.S. consumers were becoming less likely to conduct financial transactions over the Internet.
Even the Securities and Exchange Commission (SEC) has expressed concern about the trend. In September, it issued a guide on the dangers that identity thieves posed to online brokerage accounts.
More details of the Schwab plan can be found on the firm's Web site.