TEN TIPS: Identity Theft Protection
A new study shows that identity fraud increased in both 2011 and 2012, affecting over 5% of U.S. adults. Big spikes were noted in 'new account fraud' and 'account takeover fraud' -- two of the most damaging types of ID theft. And those damages amount to about twenty billion dollars a year, reason enough for any consumer to be on guard. Read on for my tips on avoiding fraud and identity theft...
Ten Ways to Protect Yourself From Identity Theft
Identity theft is one of the most traumatic non-violent crimes to which one can fall victim. When a crook uses your good name to commit fraud or robbery, the impact on your reputation, employability, and credit is severe and can last for years. It's even possible to find yourself arrested for crimes you did not commit. So it's important to protect yourself against identity thieves.
The telltale signs that your identity has been stolen can be subtle and go unnoticed for months, even years. Inexplicable charges on your credit card bill may be chalked up to clerical errors. Letters from creditors you've never heard of and certainly never did business with may be ignored. But eventually, an enormous credit card bill, legal papers or police show up at your door. You are denied a mortgage or a job. Then the real nightmare of proving "I didn't do it" begins.
It can be maddeningly difficult to clear your name, costing hundreds of hours and thousands of dollars. That's why it's important to take steps NOW to make it as difficult as possible for a scammer to victimize you. Take action on these ten tips as soon as possible, and you'll tips the scales in your favor:
- Check your credit report on a regular basis, to see if there is any incorrect information, or accounts you don't recognize. My article Free Credit Reports Online explains how U.S. citizens can get three free credit reports per year.
- Shred your sensitive personal documents before throwing them away. A battery-powered cross-cut shredder can render your banking and credit card information unreadable and costs less than $30. "Dumpster diving" is a favorite, low-tech way by which ID thieves collect bank statements, credit card numbers, Social Security Numbers, and other bits of your identity from your trash.
- Be wary of telephone solicitors asking for personal or financial information to "verify your identity." Common scams involve someone who claims to be from your bank or credit card company, claiming that there is a problem with your account. If you did not initiate the call, hang up and call the toll-free number on your statement, then ask for the security department.
- Keep important documents, such as tax returns, birth certificates, social security cards, passports, life insurance policies and financial statements secure in your home. A fireproof safe is a good idea, but remember to bolt it to the floor or hide it well.
- Make sure no one is looking over your shoulder when you enter your debit card's PIN at an ATM or point-of-sale terminal. I recommend the "two finger method" where you point two fingers at the ATM keypad, but only press with one. This makes it nearly impossible for someone nearby to discern your PIN while you're entering it.
- Memorize PINs, account numbers, and passwords; do not write them down. And for heaven's sake, do not put such data on scraps of paper kept in your wallet, purse, or laptop case!
- Get blank checks delivered to your bank branch, not to your home mailbox from which they may be stolen. On a similar note, eliminate junk mail which may contain "convenience checks" and credit card offers that can also be intercepted from your mailbox. Visit the Privacy Rights Clearinghouse and OptOut Prescreen for help eliminating these dangerous nuisances.
- When you order a new credit or debit card, mark the calendar and follow up promptly if it does not arrive within 10 business days. Ask the card issuer if a change of address request was filed, and if you didn't do it, hit the panic button.
- Don't give your Social Security Number to any business just because they need a "unique identifier" for you. Instead, ask if you can provide alternate proofs of identity, such as your driver's license or birth certificate.
- Consider placing Fraud Alerts with the major credit bureaus, so new accounts cannot be opened without your knowledge. Call Equifax (800-525-6285), and they will pass along the request to both Experian and Trans Union. Fraud alerts expire after 90 days, so you can repeat the process quarterly, or lock down your credit file with a Credit Freeze. A freeze is permanent and free (in most U.S. states) but it may interfere with loans applications, employment screening, signing up for utility or phone service, new insurance policies, and other transactions. You'll also need to contact each credit bureau (Equifax, Experian, and Trans Union) to request the credit freeze.
There are plenty of common sense things you can do to protect against identity theft, but sometimes it's beyond the control of even the most vigilant. The Javelin Research 2013 Identity Fraud Report found that data breaches perpetrated on large companies proved to be a "treasure trove" of data that could be used to commit identity theft and fraud. And before you put too much blame on those big corporations, check yourself. Security firm McAfee says that when a relationship ends, it's quite common for an angry ex to engage in revenge tactics, which may involve exposing your personal data or passwords. So be careful what you share via email, text and social media. And keep passwords close to the vest.
What About LifeLock?
You may be considering LifeLock or a similar identity theft protection service. Although this can be helpful, no company can guarantee that identity theft will never happen. These services monitor your bank account, and look for suspicious online activity done in your name. They'll alert you if they spot any red flags and promise to help you repair the damage. But because of lawsuits filed by the credit bureaus, Lifelock can no longer place fraud alerts on your behalf. Also, all identity protection services are barred from offering Identity theft insurance coverage to residents of New York state.
It can be a nuisance to manage fraud alerts manually. But given the recent focus by scammers on new account fraud and account takeover fraud, a service such as LifeLock, Identity Guard or Trusted ID may still be useful. Most cost about $10/month, which isn't much for the additional peace of mind they offer.
Do you have other tips for avoiding identity theft? Post your comment or question below...
This article was posted by Bob Rankin on 7 Mar 2013
|For Fun: Buy Bob a Snickers.|
Geekly Update - 06 March 2013
The Top Twenty
Is Your Web Browsing Really Private?
Post your Comments, Questions or Suggestions
Free Tech Support -- Ask Bob Rankin
Subscribe to AskBobRankin Updates: Free Newsletter
Copyright © 2005
- Bob Rankin - All Rights Reserved
Article information: AskBobRankin -- TEN TIPS: Identity Theft Protection (Posted: 7 Mar 2013)
Copyright © 2005 - Bob Rankin - All Rights Reserved