There are not many things that can ruin your day like becoming a victim of identity theft. Identity thieves are becoming more and more sophisticated and the number of identity theft victims continues to escalate at an alarming rate. Learning basic identity theft protection techniques can go a long way in protecting your identity.
What is Identity Theft?
Identity theft is a crime that occurs when someone illegally uses another person’s personally identifying information, such as a credit card number or social security number, without permission, to commit a crime or fraud. There are many different forms of identity theft.
Consequences of Identity Theft
If someone steals your identity, they can become “you” and do things in your name without your knowledge, such as the following:
- Commit crimes
- Open new credit cards and run up huge balances
- Open a bank account and write checks that bounce
- Take out loans
- File bogus tax returns
- Make purchases
- Create counterfeit checks
- Rent an apartment
- Apply for government benefits
- Open a wireless, phone, or utility service account in your name
It takes some identity theft victims years to notify creditors and law enforcement, correct their credit report, close compromised accounts, and open new ones.
Additionally, identity theft can destroy your credit score and your reputation, potentially ruining your chances of obtaining housing, insurance, jobs, loans, and other opportunities. In extreme cases, victims of identity theft have even been arrested for crimes they did not commit.
How Identity Theft Occurs
Identity thieves obtain sensitive personal information in order to steal identities in many different ways including the following:
- Steal a purse, wallet, or mail.
- Swipe a credit card through a special device when processing payment to steal the card number.
- Rummage through trash looking for sensitive information that nobody bothered to shred.
- Send unsolicited emails that impersonate a bank, Amazon, a credit card company, or a utility company that request that the recipient disclose sensitive personal or account information.
Identity Theft Protection Basics
It is much easier to prevent identity theft than to repair the damage caused by identity theft.
Most people, with some diligence, should be able to monitor their credit on their own. However, for those who don’t have time to do it themselves, want assistance, or want continuous monitoring, there are inexpensive credit and identity theft monitoring services, such as TrustedID, that will continuously monitor your credit report for possible signs of theft and fraud.
Although these services likely can’t prevent identity theft, they may warn you early on of activity in your credit file that indicates identity theft so that you can take appropriate steps before the damage increases.
Here are some other effective identity theft protection steps you might consider taking:
- If you will be out of town, have your mail held at the post office.
- Install a firewall to keep someone from obtaining remote access to your computer. Additionally, stay current on your security patches and use anti-virus and anti-spywaresoftware to protect your computer. Companies such as Kaspersky and Panda Security have products that provide AntiVirus, Firewall, and AntiSpyware protection.
- Update your passwords regularly. Use strong passwords that combine capital letters, lowercase letters, numbers, and symbols.
- Obtain a good crosscut shredder to destroy sensitive information before discarding. This will protect you from “dumpster divers.”
- Update your brower to one with the latest anti-phishing capabilities.
- Don’t carry around credit cards, passwords, checks, Social Security cards, or anything else you don’t need. Keep items you don’t need in a safe, secure filing cabinet, or other secure place.
- Sign up for online bank and credit card statements.
- Protect the mail you send and receive. Stealing mail is one of the easiest and most effective methods of identity theft. For incoming mail, get a lockable mailbox or use a PO Box. Drop outgoing mail off at the post office.
- Check your credit card bills and bank statements regularly for fraudulent activity.
- Keep your social security card in a secure place and only give out your social security number when absolutely necessary.
- Never provide sensitive information in response to an unsolicited email, phone call, letter, or fax.
- Make sure that you use a secure server when providing sensitive information over the Internet. A secure server’s URL will begin with https:// not http://. Additionally, a key or lock symbol should appear on the Web page.
- Review your credit report on a regular basis
- Never email sensitive information. If you must, password protect the information in an attachment.
- Go to www.optoutprescreen.com to prevent unsolicited credit card offers.
- Make a note of what is in your wallet or purse. If it is ever stolen, you will know what was inside and what credit card companies and other institutions you need to notify.
Recognize if you are a Victim
You may be a victim of identity theft if you notice any of the following:
- Purchases on your credit card statement that you never made
- You are denied credit despite good credit management
- You receive statements for credit cards or bank accounts that you never opened
- You notice suspicious accounts on your credit report.
What if your Identity is Stolen?
If you are a victim of identity theft, act immediately. I recommend doing the following (and keep a record of all correspondence and conversations):
- Place a fraud alert in your credit files at each of the three major credit bureaus: Equifax, Experian, and TransUnion. Continue to check your credit reports from time to time.
- Close any accounts or cards that you believe were opened fraudulently or that have been tampered with. Don’t forget to update any automated transactions.
- File a complaint with the FTC.
- File a report with your local police or the police in the location where the crime took place.
- Consider placing a freeze on your credit.
Additional Identity Theft Protection Resources
- Stealing Your Life: The Ultimate Identity Theft Prevention Plan
- The Wall Street Journal. Complete Identity Theft Guidebook: How to Protect Yourself from the Most Pervasive Crime in America
What are your thoughts on identity theft? Has your identity ever been stolen? What identity theft protection steps have you taken? Leave a comment below!