How To Prevent
As an Internet merchant whose website accepts credit cards for payment,
I consider myself very well informed on consumer issues involving credit
card fraud, theft and abuse on the Internet, but I was absolutely shocked to hear how many Americans are victims
of Identity Theft which is a far more horrific crime. The Federal Trade Commission estimates that 10
million Americans were victims of identity theft in 2002. Other sources estimate that about 27 million
Americans were victims of this crime in the past 5 years. That's nearly 1 out of every 10 Americans
having their credit ruined and their lives disrupted.
Victims of identity theft have their lives thrown into chaos as they are
hounded by creditors, virtually ignored by local police departments and their credit rating
is destroyed. On average, it will take victims over two years before they will have repaired
their reputations and restored their credit rating. And even though most bank accounts and
credit cards have some built-in protections, the average victim of this crime will spend
nearly $3000.00 to repair the damage. One can only imagine how frustrating it
gets to be during this time when victims are faced with requests for multiple forms of identification
whenever they use their credit cards or try to write a personal check. Local police departments
seldom put any real investigative efforts into this crime because the amounts of money involved
in each individual transaction is often below the threshold for a felony.
David Lazarus, a respected columnist for the
Business section of the San Francisco Chronicle, had his identity stolen and discussed
his three-year ordeal in a series of columns for the paper a few years ago. Lazarus related how he
only discovered the fact the identity theft when he applied for a home loan. His tormentor had been abusing
credit card accounts in Lazarus' name for over a year. And the thief was arrested only because
Lazarus took matters into his own hands and, after several months of investigating, located
the criminal on the East Coast and led the police to his doorstep.
There are some simple steps you should take to avoid becoming a victim of identity theft.
Protecting Yourself From Identity Theft Offline
- Guard Your Social Security Number. Your Social Security Number is the key to
your financial records and credit. Your employer needs it and your bank needs it, and
credit card companies need it, but nobody else should have access to this number unless
their is a specific law requiring it. Landlords will often request prospective
tenants to include this number for their background check, but you may not actually be
required to do so. Check your city's regulations before you go apartment hunting so that
you'll know your rights and obligations. The bottom line is that you should always be sure you
know the legal authority by which any person or company demands your Social Security Number. Never
put your Social Security Number on your checks or on any document that you carry with you on a routine basis.
- Keep your important paper documents in a safe place. No, not in a file on your computer.
Home floor safes are a great investment. They are excellent protection from
fire damage, and will often deter a burglar. Be sure to get one that is rated for
fire protection up to 1200 degrees for one hour which is the minimum necessary to protect
paper documents from a house fire. I used to sell these home safes in a department store
many years ago, and we had many customers come in over the years to thank us
because the safe had protected their valuables from fire or theft. They're available in many department
stores like Sears, and home improvement stores like Home Depot for under $200.00. Another obvious
place to store important documents is in a Safe Deposit Box at your bank, which provide even better
protection but at a higher, ongoing cost and with much less convenience than a home safe.
- Shred all documents that contain personal information before disposing them. This includes credit account
billing statements, old bank statements, receipts, insurance forms, and pre-printed credit card applications
you receive through the mail. Buy a good home paper shredder and use it. The inexpensive desktop
models are usable, but I prefer the larger ones that sit on top of a wastepaper basket because they can
shred several documents at a time and will generally last longer.
- Before you give your personal information to anyone, ask them how the information will
be used. Take whatever steps you can to "opt out" of any programs that will allow
any bank or other company to share your information with other companies. Banks and credit card
companies are routinely making changes to their privacy policies now so that by continuing to
do business with them you are also automatically granting them the right to share your personal
information unless you specifically demand that they refrain from doing so. So the next time you
see one of those little booklets in your monthly bill or your account statement, don't just
toss it in the trash with the rest of the paper debris, check for
source of junk mail and telemarketing calls.
- Never carry credit cards or forms of identification that you won't need that day. No matter how
convenient it might seem, having all of your credit cards in your wallet or purse just means
you are more vulnerable to this crime should they be lost or stolen. I've been guilty of violating
this rule, but I've gotten religion about it now. For an everyday card, use one of the new debit
cards that take money directly from your checking account rather than a regular Visa or Mastercard.
That way there's a limit to the amount of money the crook will have access to and you won't be
risking your credit record. Just be sure your bank offers the same theft and fraud provision for
your debit card that they do for regular credit cards. If your bank doesn't offer this protection,
move to a different bank. It's too important to leave yourself vulnerable to this problem for the sake of
avoiding the inconvenience of having to change your bank account. And look on the bright side - having your
debit card handy might reduce the number of times you have to pay an ATM fee for a cash withdrawl.
- Order a copy of your credit report once or twice a year and check to make sure there
are no loans or credit card accounts in your name that you don't recognize as being your own. The sooner
you detect this crime, the better your chances are for reasonable recovery. Make a list
of all of your credit card account numbers with the names, addresses, and telephone numbers
of the issuers so you can contact them immediately if you detect something is amiss. You'll
find the telephone numbers of your credit card issuer on the back of the card itself. You can
order a free credit report every 12 months from the major credit reporting agencies -
Equifax, Experian, and
TransUnion - from the official U.S. Government-sanctioned website
annualcreditreport.com. There are many other sites that
offer a "free credit report," including the reporting agencies own sites, but they will usually
require that you sign up for a trial version of their services or otherwise allow them to send marketing
materials to you. You do not need to pay for this service. The agencies are required by law to provide
you with your report at no cost every 12 months under the Fair Credit Reporting Act. The site above is
specifically set up to provide a no-strings method of getting your credit information. You may have to
pay a fee on those sites to see your credit score number, which will vary from one service to the next. One
site that will show you your credit score for free is Quizzle.com. They'll make you go
through advertising for mortgages before you get your credit score, but it's free and legit. Checking your
own credit report will not affect your credit score. More information is available from the
Federal Trade Commission site.
and FTC Credit Information.
- Be Very Careful When Using Any ATM ATMs are very popular with identity thieves. They
install their own equipment over the normal ATM card readers called "skimmers" to record the data
from users' credit and debit cards. They instead sometimes install hidden video cameras pointed at the ATM
so they can record users entering their PIN numbers. So when you use any ATM, inspect the machine closely
for an external card reader or other unusual equipment that protrudes from the outside case. Always cover
your hand when you enter your PIN number. Avoid using any ATM that isn't directly owned and operated by
your bank both because they're more vulnerable, and because you'll often end up paying extra fees. These
fraudulent machines record your account number and PIN for the theives and just tell you that there was a
problem with your transaction. And never use an ATM located outdoors where it can be easily tampered
with by theives.
Protecting Yourself From Identity Theft Online
- Never click on links in EMails.
And I mean never! EMail is one of the
most common ways that thieves obtain personal information from unsuspecting victims using a method called
"phishing" because this technique is like a fishing expedition. The thieves send out thousands of EMails
that purport to be from your bank, an online store, PayPal™, or eBay™ that contain links that
actually take you to a fake duplicate site where they steal your information. These EMails often
warn you that the company has detected a problem with your account and that you must visit their
site in order to correct the problem. If you do click on the link in the Email, you'll be sent to
a site that looks very real, but is actually a trap. If you get an Email that warns you about a
problem, again, do not click on the link in the Email. Instead, type in the site's
web address in your browser and log in normally. If there really is a problem with your account, the
company's website will tell you about it when you log in normally and will guide you to the solution.
- Use Anti-Virus and Anti-Malware Software Besides phishing scams in Emails, surfing the Web
has its own dangers. The first line of defense is making sure that you have a good
Anti-Virus program installed on
your computer, and that it is up to date. If you see a warning message from your browser,
your anti-virus program, or from Google, take the warning seriously and do not proceed to the
website in question. No anti-virus program is foolproof, and you don't want to be among
the first victims of a new virus that your program cannot detect. Many of the new viruses
scan your computer for personal information and then Emails that information back to the theives
without you ever being aware that anything unusual had happened.
- Use strong passwords Every website that records your personal information requires
you to create a password for your account, so it's important to use a password that would be impossible for
a thief or hacker to simply guess. All of the major browsers are capable of remembering your passwords for
you and keeping them very safe, so feel free to use passwords that don't contain your own name, your pet's
name, or your favorite athelete's name. Be inventive! Use a combination of mixed case letters, numbers,
and symbols (dashes, underscores, exclamation points, etc.). If you want to make a good password that
you can easily remember, try replacing some letters with numbers. For example, instead of the letter
"o", use the number 0, or instead of the lower case letter "i", use an exclamation
point "!". And do not make a list of your passwords to carry with you. Obviously, if you
have such a list in your wallet or purse and you lose it, you've given someone complete access to your
online life including your bank accounts.
- Don't post your personal information where it is accessible by the public. Social
networking sites allow you to post personal information like your birth date, your high school, and so
on - all of which is like gold to identity theives. Be sure to use the privacy settings on all social
networking sites to keep all of your information private.
- Do Not Store Private Information On Your Smartphone or Computer's Internal Hard Drive. In
a world where you can take everything with you, it's easy to forget how easy it is to lose that handy smartphone
or notebook computer. And if that device falls into the wrong hands, you could easily fall victim to identity
theft. Use an external storage device to hold all sensitive data and documents. External hard drives and
thumbdrives are inexpensive insurance. You can quickly connect them when you need to work on your finances,
and they're just as easy to disconnect them when it's time to leave for work in the morning. Desktop computer
users should take this advice as well. Should you ever need to take your equipment in for repair,
you'll sleep better knowing that there's nothing on your hard drive to tempt the poor underpaid repair
technician. And when the time comes to sell or discard your old equipment, you'll know that you haven't
left any private data on the hard drive that someone could easily find. However, you should still take
the time to do a deep clean on any device before you sell or discard it. For the best security, you
should use a qualified hard drive disposal service that will physically destroy your
- Your Printer Might Hold Personal Data. When the time comes to replace your
computer's printer, you need to take steps to remove any private information that may have been
stored in the printer's internal memory which can happen whenever you print documents containing
such information - even after several months. Most manufacturers have information available online
for wiping out the memory in succeptible printers. Hewlett-Packard has created an excellent
Security Action Plan for business users.
If You're A Victim of Identity Theft
Look at Federal Trade Commission's
Guide for Victims of Identity Theft and you'll get some excellent advice on what you should do
to recover from this modern nightmare.
In addition to following the advice on the FTC's webpage mentioned above, you should
also file a complaint with the Federal Trade Commission by contacting the FTC's Identity Theft Hotline by telephone:
toll-free 1-877-IDTHEFT (438-4338); TDD: 1-866-653-4261; by mail: Identity Theft Clearinghouse, Federal
Trade Commission, 600 Pennsylvania Avenue, NW, Washington, DC 20580. This helps the government
track patterns of abuse, develop more legal and procedural solutions, and to see that the
worst criminals are put in jail.
These are Fraud Report numbers for the three major credit reporting agencies in the United States.
Banks and other companies refer to one or more of these agencies to determine your creditworthiness
whenever you apply for a loan or a credit card. So it's important to let the financial world know that
your identity has been compromised in order to prevent any further losses and speed up your recovery.