By Gradia A. McKinney
Large Employer Relationship Manager & Marketing Manager
Identity theft was one of the top three complaints the Federal Trade Commission received last year.
According to a recent study by Javelin Strategy & Research, $16 billion was stolen from 15.4 million US consumers in 2016. These numbers are higher than 2015 figures despite the fact that more retailers began accepting chip technology credit and debit cards.
‘Europay, MasterCard®, and Visa® (EMV) microprocessor chip technology is quickly becoming the global standard for credit card and debit cards, due to the added security the chips offer.’
What is Identity Theft?
Justice.Gov defines identity theft as, ‘all types of crime in which someone wrongfully obtains and uses another person’s personal data in some way that involves fraud or deception, typically for economic gain.’
Types of Identity Theft
There are at least six different types of identity theft that pertain to individuals and businesses. This article will focus on the types of identity theft that affects individuals (consumers):
- New account theft: This type of identity theft takes advantage of an individual’s good credit standing. Generally, the perpetrator will use an individual’s personal identifying information to establish credit accounts to obtain products and services.
- New utility accounts, new cell phone accounts and even new credit card accounts are in this category. The victim may not recognize this fraud because the bills will go to a different address.
- Account takeover theft: This theft occurs when products and services are bought using the victim’s existing account information, and may appear as unauthorized credit card transactions on a credit card statement.
- The theft is usually easy to identify because the unauthorized charges will show up on monthly billing statements.
- Criminal identity theft: IdentityTheftInfo.com describes criminal theft as the use of any form of identification to deceive a law enforcement officer or agency into assigning a criminal act to the name of an identity theft victim.
- Victims may be unaware of this theft until they are turned down for a job, or arrested following a routine traffic stop.
- Medical identity theft: According to World Privacy Forum, ‘medical identity theft occurs when someone uses a person’s personal identifying information — such as insurance information — without the person’s knowledge or consent, to obtain medical services or goods, or uses the person’s identity information to make false claims for medical services or goods.’
- Some experts consider medical identity fraud one of the most dangerous types of identity theft and one of the most difficult to fix.
- Identity cloning theft: Rather than stealing personal information and using it for financial gain, identity cloning compromises the victim’s life by living and working as the victim. With identity cloning, an imposter assumes the victim’s life—-in a different location.
- Whereas medical identity theft may be the most dangerous, identity cloning may be the scariest, and may also be quite difficult to correct.
Preventing identity theft: Although the number of cases of identity theft has increased steadily over the last several years, experts recommend a taking a few precautions to protect yourself:
- Place a credit freeze (security freeze) on your credit files with all three credit-reporting agencies. A credit freeze prevents lenders from viewing your credit report. If lenders are unable to review your credit report, they can’t authorize new loans. All three credit-reporting agencies offer credit freezes for a small fee. If you’ve already been the victim of identity theft, the reporting agencies may waive the fee.
The freeze may be removed at any time, sometimes for an additional fee. It’s important to note that a credit freeze prevents access to new loans. It will not stop someone from identity cloning theft or account takeover theft, given that they already have access to some of your personal information. Learn more about credit freezes here:
- Create strong passwords. Change them periodically. A strong, secure password makes your account more difficult to access by unauthorized users. Choose a password that includes a combination of upper and lower case letters, numbers, and special symbols. If possible, try not to use the same password for multiple accounts. Change your passwords periodically; say quarterly, or twice a year, for example.
- Invest in a good cross shredder. Don’t just toss those pre-approved credit card invitations, your bank statements, or credit card statements. Those documents contain personal information that makes it easy to steal your identity. Shred all documents containing your personal information before you throw them away.
- Use a secure network to conduct financial transactions. Access to free public Wi-Fi in hotels or coffee shops may be a great convenience. However, because they are open networks, others can hack into them easier and monitor what you do on your device.
- Monitor your credit report and credit card statements. If you notice a discrepancy in your statement, such as an unfamiliar charge, or an unauthorized withdrawal—-no matter how small—-notify the institution immediately. Often the institution will reverse the charge and investigate the matter through their fraud department. A thief will ‘ping’ your account with a small transaction before larger transactions occur.
- Protect your Social Security number. Keep your Social Security number safe and don’t share your number unnecessarily.
- Limit information you share on social media. Your birthdate, including the year you were born, home address and place of employment are all pieces of information a thief can use to build a profile on you and steal your identity. Avoid over-sharing on social media.
- Assign a password for your phone. Your phone likely contains quite a bit of personal information about you, including banking apps, PINs, etc. Password protecting your mobile devices will make your information more difficult to access in the event that you lose that device or if it is stolen.
- Recognize the signs of phishing. Your identity may be stolen when you are directed to a web site that appears to be one that is familiar to you. Emails that ask you to verify sensitive information may be fake sites designed to collect your personal information. Watch for grammatical errors, typos, etc. If you suspect a phishing-scheme, notify the legitimate organization. In most cases, they have information on their web sites providing actions you can take.
- Keep your mail safe. Taking a vacation? Ask the post office to hold your mail until you return, or ask a neighbor to collect and hold your mail for you. Banking statements, credit card statements, and other mail contain personal information useful to identity thieves.
- Keep your virus software updated. New viruses are routinely introduced in an effort to thwart your anti-virus software. Consequently, anti-virus software companies work diligently to keep up with the latest viral threat.
- Beware of telephone scams. Don’t share your personal information over the phone, especially if you didn’t initiate the call.
What to do if you are an identity theft victim: If you suspect that you’ve been a victim of identity theft, take action right away.
- Notify your credit card companies. Notify the company of the compromised card first.
- Place a fraud alert on your accounts. Learn how here.
- File a report with the Federal Trade Commission (FTC)
- File a police report. Many credit card companies require a policy report before they will close your account.
- Enroll in a credit monitoring service. A credit monitoring service will help you keep tabs on attempts to access your personal information to establish new accounts or make charges on existing accounts.
- Close the old accounts; open new credit card and financial accounts. You may need a police report to take this step too.
Identity theft is not likely to go away anytime soon, so it’s important that you be vigilant, protect, and monitor your personal information.
For more information about identity theft, visit the Federal Trade Commission’s website.