Protecting Yourself from Identity Theft
Identity theft happens to millions of people each year, no matter how high or low their checking account balance. No one is immune. And with over 15.4 million identity theft cases in 2016, it’s one of the fastest growing crimes in the world. Depending on how long the fraudulent activity (that means it’s illegal and done by someone claiming to be another person) has gone on undetected, it can take months or years to sort out the mess and get the victim’s life back on track.
Time isn’t the only cost of identity theft. Victims also suffer two forms of financial loss: direct and indirect. Direct loss is the money stolen or misused by the thief from banking or savings and investment accounts. Indirect loss includes other costs like legal fees, overdraft charges, harm to their credit score, or time missed from work to combat the fraudulent activity.
Knowing how identity theft is committed and what you can do for free to prevent it can help ensure your name isn’t added to the list of victims.
Identity thieves are smart, and they can work the credit card, healthcare, and online shopping systems—even the U.S. Postal Service—as well as social media to steal information from you in order to rack up charges on cards, steal money, take loans out in your name, collect on government aid, and harm your credit score. They don’t even need all of your information to steal your identity. They can use one or two pieces of information to gain access to others.
Social engineering is when an identity thief targets and manipulates a victim through social sites like Facebook, Twitter, Instagram, LinkedIn, and others to obtain confidential information. They trick victims into giving out passwords, personal information, bank information, or access to their computer to install harmful software to steal more information. Criminals use social engineering because it’s easier to get information from people than hack into a computer. Once the criminal has only a few pieces of personal information, they can use it to impersonate the victim and gather more information from their credit card or utilities company.
Public Wi-Fi hot spots also pose a perfect opportunity for criminals to steal information from connected laptops, mobile phones, and tablets. A hacker can intercept any information you share online via a public Wi-Fi hotspot, including login passwords and usernames, credit card numbers, and any other data they could use to pretend to be you online or on the phone.
Stealing your snail mail right out of your mailbox can give identity thieves access to any information printed on a health care statement, bank statement, credit card bill, or tax document. They will also go through your trash for discarded documents with important account information.
Phishing scams via phone or email are another way for criminals to steal information directly from you. By posing to be a trusted company—like a utilities company, a government agency, or your credit card company—they attempt to get crucial information from you, usually by saying that it’s for verification purposes.
How to Prevent ID Theft
With all of the ways criminals and hackers can attempt to steal your personal information, there are things you can do—for free!—to prevent their success. The first and easiest step of prevention is to not carry crucial documents like your social security card with you in your wallet or purse where it can easily be stolen. Also be careful not to give it out over the phone.
Shred any document that has account numbers, your name and date of birth, or tax identification numbers instead of throwing the paperwork out whole in the trash. Libraries often have paper shredders to use for free.
Monitor your credit report and credit card statements regularly. It may be the only way you’ll notice fraudulent activity. You get one free credit report a year from each of the three national consumer reporting companies (Equifax, Experian, and TransUnion). Look at each charge on your monthly credit card and checking account statements. Sometimes identity thieves will make small “test” charges of a dollar or less to see if you’ll notice. If you don’t, they’ll start making larger purchases, while still trying to fly under the radar, so they can steal more money from you without you noticing.
If you order personal checks, pick them up at the bank or credit union instead of having them mailed to your house. Criminals can make small changes on the checks, so they can use them to write false checks, all deducted from your account. Be familiar with your credit card billing and other financial statement cycles. If a bill is late, it could have been stolen and your information may be compromised. The easiest way to avoid this completely is to go paperless with all of your statements!
Don’t list your full birthday, phone number, or address on any social networking website. This is often a great starting point for criminals looking to use social engineering.
Be aware of how ATM, gas pump, and store credit card readers look. If the credit card reader doesn’t match the rest of the machine or sticks out, don’t use it. Fraudsters install these fake terminals so they can scan your card as you swipe it. If you’re unsure, ask the store clerk or attendant to take a look.
Lastly, if it’s within your budget, you can pay for credit monitoring services, which usually cost $5-20 per month. Companies like Identity Guard, TruCredit, and LifeLock will alert you when a third party requests your credit report, if any significant changes happen on your report, if changes are made to your information, and if new accounts are opened. Some offer ID theft insurance.
You worked hard for your money. Don’t risk someone else spending it.
What to Do if It Happens to You
If you suspect your identity has been stolen, fraudulent charges made on your credit card, or fraudulent activity made on any banking account, act quickly. Be sure to do the following:
- File a police report and be sure to get a copy of the report.
- Call and report the fraudulent activity to your credit card. Make sure to get in writing from the credit card company that you’ve reported the criminal activity and that they have closed or put a hold on your accounts.
- Put a hold on all of your banking accounts.
- Call the three credit reporting agencies (Equifax, TransUnion, Experian) and report the fraud. Have them put a 90-day fraud alert on your credit report.
The Federal Trade Commission is the nation’s consumer protection agency, and they have valuable resources for victims of identity theft. It’s a good idea to get an ID Theft Affidavit from the FTC website (www.ftc.gov) so you can submit it to any creditors trying to collect on defaulted loans taken out in your name by the criminals. You can also contact the FTC about identity theft by phone at 877-ID-THEFT. Giving them your information quickly will help them track down and stop the thieves.
Identity theft is a very real threat in today’s highly connected, digital world. Thieves have many opportunities to steal valuable personal information. Following online safety guidelines and being smart about debt and credit card use will help ensure you don’t become a victim. If you have questions about putting extra measures in place to protect yourself and your money, talk to your local credit union.
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