Let's Talk About Identity Theft
One of the biggest misconception that I come across with students and customers is that they are more at risk of identity theft if they use a computer. Most seniors that sat in my class believed this. In fact, this was one of the biggest factors in why they were reluctant to purchase a computer.
Unfortunately, you can be a victim of Identity Theft through the use of your computer. This is a fact and this section will discuss the different aspects of this later. For now, everyone should know that there are other factors that make you much more likely to be a victim. The two biggest dangers typically sit in your house at Thanksgiving and Christmas dinner; Your family and your garbage. In no particular order;
Your Garbage
What does your garbage say about you? Although this video is over 2 years old, the points made in it are still vital. The biggest danger you face is your garbage. Dumpster diving is the favorite method criminals like to use to get your identity. There is a quick test that you can take to see if your garbage is a danger to you. Get out some gloves (this may be messy if you had Sloppy Joes in the past couple of days) and go through your garbage. If somebody who does not know you can pick things out of the garbage that can identify you personally, in any way, you are in danger. Many Americans make the fatal mistake of throwing our mail, records and personally identifiable information in the garbage. When you sit your garbage out in the evening or morning and come home later and see it gone, how do you know the garbage man took it? Better yet, how do you know the garbage man isn't the one looking through it?
Typically, ID thieves need only a couple pieces of information to gain your identity. Your name, social security number, maiden name (if applicable) and one account number. All mail you throw out has your name, if you throw out old bills, they now have an account number to somewhere. Sometimes, that is enough to get started. This does not account also for the vast amount of other information we volunteer to thieves in our garbage.
Your Family
Think about your family and think about that one relative that you do not trust. Doesn't matter the reason, you simply do not like or trust them. Well, you may have a reason, they are more likely to steal your identity. Why? Well, there is an underlying reason why you never liked them in the first place, right? Quite simply, a family member is very likely to steal the identity of another family member. They have access to most of the information needed to start stealing and they typically know which family member is most vulnerable and least likely to turn them in to the authorities. Sadly, a high number of thefts involve a parent stealing the identity of their own child.
ID theft among family members frequently happens because family members are more likely to not press charges, to try to "work it out". ID thieves know this, they can play on the sympathy of their target to not press charges. In the case of parent and child, the child will have no idea of what is happening until they become an adult. In case you ask, "how can a child get credit cards, loans, etc., don't the banks check this out"? In short, many times no, they typically check to see if there is a valid social security number and that is it. Of course they should be more thorough, but as of now, that day has not come.
Prevention (ie. what am I doing that I shouldn't do or stop doing)
The ultimate solution, a Credit Freeze
A credit freeze simply freezes all credit in your name, either permanently or for a period of time, your choice. If anyone applies for any credit, loan, etc. When a credit check is done, the credit bureaus report back that that account is frozen, thus no credit can be issued. The only issue with a credit freeze is that it applies to you too. It's your account and it's frozen so even you cannot get credit. You can unfreeze it at anytime, but if you want to make a spontaneous decision to open a credit card, you must unfreeze your account first. For a simplified explanation to how a credit freeze works, watch this video.
Buy a Diamond Cut Shredder - One that cuts documents into small confetti. If it cuts into strips, a determined thief can tape the document back together. Never underestimate the determination of a thief. Shred all paperwork that you do not want that has personal information about you. Old statements, mailing labels and junk mail. Take particular note of pre-approved credit card offers. They are pre-approved because they already have checked your credit. The card will be issued to you if you agree and sign the form. If somebody else gets that paperwork, all they need to do is sign "your" name and mail it in. Just like that, "you" have a new credit card issued. All they did was change the account address, so now that card is going somewhere else. Shred balance transfer checks too, those things are free cash to thieves.
Never Leave mail for the mailman - When you leave the phone or credit card bill in the mailbox for the mailman, you may be saving the mailman time, but you are also making the job of a identity thief easier. Picture this, I'm walking down the street looking for garbage to steal, I see your mail in the mailbox. Hey, there is your Citibank payment. What do I have now? Your Name, Address, Credit Card Account Number, your bank account number, your bank routing number. Your identity is gone now. Not to mention that your payment is now late because it never gets there. Never leave mail in the mailbox for the mailman, unless you are there when he or she picks it up (in that case, negating the need to leave it there) you have no idea whether or not the mail employee took the mail.
Pay Cash in a Restuarant - Your Waiter/Waitress may be a thief. In short, never give your card to someone who takes it out of your sight.
Check your ATM before use - Did you know that anyone can buy an ATM machine and put it anywhere? Given that, how do you know that that owner is trustworthy. Stay away from independent ATM machines. Also, check for any weird wires or unusual attachments, if any on your ATM. Thieves have been known to put skimmers on legitimate ATM's. This report from Fox News tells you how to identify a skimmer on your local ATM.
Check your wallet content - Take out any card in your wallet and/or purse that you do not plan on using when you go out. If you lose it or if it is stolen, you only have released more information than necessary to a thief.
Xerox everything in your wallet/purse - Quick quiz again, take out a piece of paper and list (without looking) every card in your purse or wallet, list the account numbers, membership numbers, contact number, etc. Do this for every card. Can't do it? Well if your wallet/purse is stolen you will definitely need that information to cancel the accounts or to contact people. It's funny that the number to contact the credit card in the event that it is stolen is on the back of the credit card. Xerox, you will be thankful to have the information.
Cancel Dormant Accounts - Not all of them, it could negatively impact your credit rating, but if you have 10 credit cards and only use 2, it might be safe to cancel 3-4 or them. The point is that people with many accounts tend to forget about the ones they are not using. If that account gets stolen, it may be months to years before you find out. If you are not using it, you don't check it.
Get your Free Credit Report - Despite the commercials, there is only one true place to get your free credit report. Annualcreditreport.com is the only place where it is completely free. Every other site will try to sell you something along with the free report. You can choose to have your report mailed to you or to view them online. You are entitled to one credit report from each of the three bureau's (Equifax, TransUnion and Experian) each 12 month period. The best method is to get a report from a one bureau every 4 months (ie. Transunion in January, Experian in May, etc.) By staggering the reports, you will be more likely to spot fraudulent activity.
If you want a report more frequently, you have to pay for each report after the first, if it is within a 12 month period of the free one. You can try Quizzle and CreditKarma for more frequent checking. Both services offer a free report. It's not an official report of your credit, but they have a algorithm that can determine your credit rating that is almost identical to the official report. More importantly, it is free.
Check your statements - Never assume that if you did not use an account this month, that you don't need to check your statement. Most regulations stipulate that if you do not correct or report an error or fraud within a certain time period, you are liable for the charges. Check your accounts often, never assume everything is alright.
Never Give out Personal Information on the Phone - This is particularly true if somebody calls you, no matter who they say they are. If you have a doubt, call them back through an official number that you can confirm belongs to the company. Remember, your bank has all the information they need about you, so be wary if your "bank" calls you needing to confirm your account and/or personal information. Banks know who you are and where you are. Don't believe it? Bounce a check and you will find out how thoroughly the bank knows you and where you live.
So how do I prevent it on my computer?
Refer to the How to Protect Your PC page. A good portion of malware is wholly intended on stealing personal information about you. The threat is not just about extorting money out of you by installing fake virus detectors. Some malware may be there just hiding waiting for you to enter personal information somewhere online.
Phishing - Never respond to any email that tells you that a particular account has been compromised. They in general contain a link that they want you to click to log on to "verify" your account. All that will happen is that you will verify your account information to thieves. If you have a question about any online account, go to the address bar of your browser and enter the address yourself and verify. Never use a link in email.
The IRS does not send email - If the IRS needs to tell you something, they have a very special relationship with the Post Office. They have a unique ability to contact you by mail in a day. They never will contact you about your taxes in an email. Never