Identity theft is more prevalent than ever, hence protection is necessary. Learn identity theft protection and what to do in this article. Identity theft continues to be a major concern as statistics show the incidents are on the rise, which stresses the importance of identity theft protection. Unfortunately, there are still many people who don’t realize the risks and dangers, which makes them even more vulnerable. However, there are ways to protect yourself, and the best way to start is by learning what identity theft is all about, the dangers and what you need to do in case it happens.
What is Identity Theft?
Identity theft is a criminal act wherein an imposter steals your personal information such as Social Security, credit card numbers or driver’s license with the purpose of impersonating you. The information they steal is used to avail of services, credit and merchandise under your name, or it could be used to give the thief false credentials. Aside from causing you to run up debt, identity theft also causes false identification that could lead to legal trouble, and you could end up with a criminal record or have arrest warrants issued because your identification was used for committing a crime. There are two general types of identity theft, account takeover and true name takeover.
- True name identity theft: true name identity theft has the perpetrator using your personal information to create new credit card accounts, open a checking account, get a bank check or set up a new cell phone service.
- Account takeover identity theft: the thief uses your personal information to access your current accounts. What usually happens is the thief changes the mailing address on your account and produces a huge bill before you realize there’s a problem with your account. The Internet has made identity theft easier because transactions are done minus any personal interactions.
Thieves use various methods to obtain personal information: hacking into a database is one, but it’s more likely they get information using old fashioned techniques like sorting through discarded mail, paperwork left unattended, or what is called “shoulder surfing”, wherein the thief would stand next to someone at the Bureau of Vehicles or other public offices and take note of the information the person ahead provides as he / she fills up a form. In addition, these criminals obtain personal information in other ways such as the following:
- Going through rubbish and thrash to find personal information
- Obtaining personal information from redundant office or IT equipment like hard drives, USB memory sticks, mobile phones, PDAs, servers and desktop computers that have been discarded in dumping sites. If such equipment are not properly disposed of or sold without deleting private information, they may be obtained by an identity thief.
- Some criminals also use the information in official registers to find public records about people
- Mail theft, pickpocketing and housebreaking are also used to steal credit cards, ATMs, passports, identification cards and so on.
- Identity thieves sometimes pose as representatives of banks or government offices and ask questions like “What was your first pet’s name?”, “What was your first car model?” or “What’s your mother’s maiden name?”.
- Skimming data from credit cards and bank accounts using card readers, producing clone cards in the process
- Some of these criminals use contactless credit card readers to obtain information in RFID passports.
- Watching people input their login username and password, ATM numbers, calling and credit card numbers in public areas
- A growing number of criminals now steal personal information off computers using Trojan Horses, malware or keystroke logging programs. Such techniques are often used to hack into databases, systems and networks to steal personal information, usually in voluminous quantities.
There are other ways that ID thieves obtain data, such as taking advantage of breaches that result in the mistaken publication of persona data such as Social Security numbers, credit card numbers, addresses, names etc. In addition, some ID thieves work together and publish bogus job applications online, as their purpose is collect resumes and personal information. What this means is you need to be careful about the information you provide in your resume. Aside from your name, resumes usually need to include email addresses, location, contact numbers and more. To avoid ID fraud, apply only in legitimate companies and do not provide banking or financial information in your application form.
Reports also show that ID thieves are taking advantage of insider info and exploiting the access of IT users to snatch data. In relation to this, there are a growing number of cases of hackers infiltrating IT companies to steal valuable personal data as it is being processed. ID thieves also impersonate trusted and reputable companies via phone calls, SMS text and emails in an attempt to persuade you to divulge personal data or login credentials. What they usually do is create a fake website, and if that doesn’t work, ID thieves might resort to brute force, going after weak passwords and once they gain access to your account, your personal details will be at risk. One of the more common ways that ID thieves obtain data is by going to social networking websites and searching for personal information posted by users. The information obtained here is often used to make them look more credible and believable. The Identity Theft Resource Center has divided identity theft into the following categories:
- Criminal identity theft, wherein someone poses as you
- Financial identity theft, whereby your name is used to purchase goods, services and credit
- Identity cloning, when someone uses your personal information to assume your identity in daily living
- Medical identity theft, whereby your name and personal information is used to obtain drugs and medications
- Child identity theft are becoming more common as well
There are many reasons for identity theft aside from money. Several cases have been linked to funding and facilitating criminal activities such as espionage, phishing, terrorism and illegal immigration among others. There are also a growing number of identity cloning which have been used to go after payment systems, medical insurance and online credit card processing. As a user you also need to monitor your email and check for any irregularities, as some ID thieves try to divert emails and posts to gain access to personal information, such as credit card statements, bank accounts, billing and more. It’s also not uncommon for these individuals to trick and dupe individuals, help desk workers and even customer reps into providing personal information, login data and more.
What to Do If My Identity is Stolen
If you discover that you’re a victim of identity theft, do the following immediately:
- Call the national / local fraud department and inform them your identity has been stolen
- Ask the relevant institution to freeze your account. If you’re the victim of credit card theft, call your bank immediately, tell them what happened and ask to have your account frozen.
- Change your pin number, login or password if they’ve been stolen, and notify your network administrator immediately.
The next step is to place a fraud alert and work on getting a credit report. Contact your state or local credit bureau (Equifax, Experian, and TransUnion), or contact your bank and file a report to the FTC. Go to the FTC official website and fill up the online complaint form, making sure that you provide as many details as possible. If you haven’t done so already, file a complaint with the local police and bring the following:
- A copy of the FTC Identity Theft affidavit
- A government photo ID
- Proof of address (utility bill, rental statement, mortgage statement etc.)
- Any other evidence you may have of the theft (IRS notices, bills, complaint letter you sent to the bank, etc.)
Once you have filed an identity theft report, get in touch with the fraud department for all the businesses where the theft occurred. Before you call each one, remember the following:
- Explain what happened and provide as much information as possible
- Request the business to freeze or close your account
- You should also ask the establishment to furnish you with a letter stating that the fraudulent account is not yours, you are not liable for what has happened and that the illegal transactions have been removed from your account.
- Keep the letter the establishment sent you just in case the fraudulent transactions appear on your credit card report later.
The next step is to have the bogus charges and transactions removed from your account. This is something the business will help you with, but do your part as well by explaining what happened and showing them which charges are bogus. If you’ve been the victim of multiple fraud, repeat the same steps above, and make sure to keep all confirmation letters that these businesses send you. The business establishment might ask you to furnish them a copy of the identity theft report you filed or ask you to fill up a complaint form. In either case, keep a copy of the form: in fact you should keep a copy of all forms, letters and documents you submit to the establishment so there’s no confusion later on. When writing a complaint letter, consider these:
- Specify in your letter who you have contacted and when
- Always ask for a credit freeze even if you haven’t noticed any significant changes in your account, as that makes it harder for the thief to use your account or create an account in your name.
- If you do request for a freeze, keep in mind that there are going to be a few extra steps needed when you apply for a cell phone service or a new credit card, in fact any service that requires a look at your credit.
- Not asking for a credit freeze isn’t recommended, but if you opt for that, at least send out a fraud alert to the proper authorities and establishments.
- File your taxes as early as possible before the scammer does it before you, otherwise you could become a victim of tax identity theft. Tax identity theft occurs when someone utilizes your Social Security number to get a job or a tax refund. If you get notices from the IRS concerning any irregularities, respond to them immediately. Better yet, inform them that you have been the victim of identity theft so they will be prepared for any tax identity theft attempts.
- Do not believe anyone who says you’ll be arrested by the IRS unless you pay for the debt or the taxes that were incurred. Don’t listen to them even if they have your Social Security number, because there’s a process to be followed.
Once you’ve filed the reports, conduct follow ups regularly (although your bank will probably notify you of any updates), and keep a close eye on your credit reports for any irregularities. The most important thing to remember is not to panic: your concern is understandable, but you cannot allow yourself to panic because this could lead to fear paralysis, and the longer you take to do something, the greater the damage.
What Will it Cost Me if My Identity is Stolen?
The steps above might seem extreme, but they’re necessary because the dangers posed by identity theft are real and if not handled properly, could lead to financial disaster and legal trouble. The first thing you need to realize is that identity theft can happen to anyone, and it’s not just rich people who are targets. As was pointed earlier, the cases of identity theft have been rising so it’s imperative you take the steps necessary to protect yourself. The fact is, identity theft is not just a nuisance as it can do a lot more damage.
- Financial Consequences of Identity Theft ~ ID thieves usually go after your credit card and this can lead to numerous financial ramifications. As the FTC has noted, ID theft can result in you owing thousands of dollars in debt, scarring your credit score and all the difficulties that come with a bad credit history. ID theft could lead to denials in mortgages, loans and employment opportunities, and this will affect your ability to open a bank account, and it’s possible you could end up with errors in your financial statements for months or years, and there’s also the fact that losing your ID could lead to life threatening situations.
- Medical ID Fraud Ramifications ~ Victims of medical ID fraud will have a difficult time getting prescriptions because another individual is using those prescriptions with your name. If you’re taking medications for a serious medical condition, the situation can be life threatening. Medical errors may also occur because of incorrect data under your name. In addition, medical ID theft makes sorting out your health records very difficult and time consuming, and if you need constant treatment this will have a detrimental effect, and you could even face legal charges if you can’t prove there was a theft. Legal trouble with medical ID theft usually happens if the ID thief gets cited or commits a crime using your name. If this happens, you could be liable for the crime even if you weren’t involved, which is why it is so important that you report it immediately.
How to Protect Myself from Identity Theft Protection
First of all, you must guard any and all personal information you use online. Most people today do their banking and shopping online, so it goes without saying your passwords and account numbers are vulnerable to ID thieves if you don’t take care of them.
Here are some tips:
- Use alphanumeric passwords, and jumble them up so hackers won’t be able to guess them easily
- Do not give out your password to anyone
- Change your passwords and logins monthly
- Do not login to your bank or shop online on a public computer
- Pay with your credit card since they are under the protection of Federal Law
- Be wary of phishing, which attempts to trick you into giving personal information. Phishing uses pop ups that appear like real banks or financial institutions, and they are accompanied by a letter requesting for personal information. Ignore these messages because banks will never ask you to submit sensitive data in emails.
- Check your bank and credit accounts regularly so you’ll know immediately if something is amiss. If you notice a purchase you didn’t make, notify the bank immediately.
- Check your mailing address with the proper financial institutions and the post office as ID bandits usually fill change of address forms to keep you off track.
- This has been said before but it bears repeating: check your credit report during and after an ID theft. Actually it’s a good idea to check your credit report even if you haven’t been victimized so if anything’s amiss you’ll know it quickly.
- Store sensitive files and documents in a secure place, or you can just shred outdated ones. Don’t just throw these papers in the thrash: get a shredder and destroy outdated credit card applications, bills, bank statements and any document that contains personal information. Don’t forget to check your junk mail because they might contain personal data too.
Some companies, for a fee, will provide ID theft protection, but is this necessary? The answer depends on your activities and how vulnerable you are. You may consider investing in ID protection under the following circumstances:
- You spend a lot of time shopping online
- You don’t have the time to check your personal information
- Reporting and coping with ID theft is stressful and time consuming, so investing in ID protection might be a good option
If you’re interested in paid ID protection, keep in mind that this will cost you, and no matter what the ads may say, it’s not 100% guaranteed you won’t fall victim. If you decide this is what you want, be prepared to spend time researching the various options available. Things will be a lot easier if you opt for the ID protection services provided by your insurer or bank, and most banks will notify you if there are any large transactions or purchases that transpire involving your credit card. Some of them even offer to pay insurance or legal fees in the event of fraud or ID theft. Some insurers bundle ID theft protection with auto or home coverage, but keep in mind that these offers usually have exclusions, so read the fine print before agreeing. You’ll also find specialty companies who advertise themselves as ID theft specialists, offering a wide array of reactive and preventive tools to keep your credit and identity safe. Features vary among these companies, but they usually have some type of fraud alert built in, and they’ll notify the appropriate credit bureaus so action will be taken if you become a victim. What makes this feature useful is it will force the bank to balk or proceed cautiously for any credit request.
Apart from fraud alerts, these companies can also conduct credit freezes, and it’s far more effective than alerts. When your account is frozen, it prevents companies from getting to your credit, effectively locking your records against a new creditor. Credit freezing rules vary, and it’s certainly inconvenient, but if you’ve been the victim of ID theft, this is the best option available. While this is something you can do on your own, having a company do it for you can be handy if you don’t have the time or don’t want to mess around with the paperwork. Whether you get paid ID protection or do it yourself, make it a point to take care of your checkbook and other financial data so no one is able to access them. While banks and financial institutions will do everything they can to protect you, you also need to take steps to protect yourself from these ID thieves.
Bottom line: identity theft protection is a necessity and not something you should ever take for granted. Usually when we read about it in the news the assumption is that “it will never happen to me”. That’s not how you should think because as has been repeatedly stressed by the authorities, ID theft can strike anyone, but by taking steps to protect yourself, the risks are reduced.