How to Prevent Identity Theft
Tips and tools to prevent identity theft and stay safe from cyber crime.
Laura Adams, MBA
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How to Prevent Identity Theft
This episode is about how to prevent identity theft and stay safe from cyber crime.
Wage War Against Cyber Crime
Wage War Against Cyber CrimeI just hate that preventing identity theft and cyber crimes are topics that we even need to discuss. But unfortunately there are lots of bad guys who choose to use their time and talents for evil purposes. Theft in cyber space is growing and no one seems to be immune—not individuals, businesses, or governments. Fortunately, I have so many tips and tools to help you prevent identity theft and win the war against cyber crime, that I needed to break the topic up into two shows. So be sure to check out next week’s episode, too.
What’s Identity Theft?
Identity theft is a serious crime that happens online as well as offline. It’s estimated that about 25% of all cases are Internet related. Identity theft happens when someone steals your personal information and uses it to commit fraud or other types of crime without your knowledge. A thief could use your name, social security number, driver’s license number, or various bank or credit card numbers, for instance, to wreak havoc in your life. And once your identity is jeopardized, getting it cleared up can cost time and money, not to mention you’ll be left to deal with a really botched credit score.
How Identity Theft Happens
In order to prevent identity theft, it’s helpful to understand how the thieves do what they do. They have a variety of ways to get your confidential information—like your social security number—and you can be sure that they’re scheming up new methods all the time. One way they get your information is by stealing it from businesses. Perhaps they work for a company that has you listed in their database. Maybe they hack into a business’s records or bribe someone who has access to them. Or they take information from your credit reports by abusing their employer’s authorized access.
Another way identity theft happens is when criminals get information directly from you. They may steal your wallet or copy your credit or debit card numbers. They could steal your mail or “dumpster dive” for information in your trash. And sometimes criminals actually change your mailing address so that your mail gets sent to them, which gives them access to your personal information and account numbers.
One of the most common ways thieves get information is by posing as a legitimate company, such as a bank. Often they’ll claim that there’s a problem with your account which needs immediate action. They may call or e-mail you to request your personal information under the guise of solving the phony problem. I’m sure most of you know that sending scam e-mails like this is called “phishing”. That’s p-h-i-s-h-i-n-g, and it’s how most cyber crime victims get taken. In part two of this episode I’ll share tips on how to quickly recognize a crooked angler’s baited hook.
What Happens to Your Identity
After a thief gets your personal information they can attempt to open new accounts in your name, spend like there’s no tomorrow, and severely damage your credit report. They could apply for new credit cards or open a checking account in your name. They could also file tax returns in your name, give the police your name if they’re arrested, buy a car by taking out an auto loan in your name, or even get a driver’s license with their picture in your name! Yes, the sky’s the scary, scary limit.
Tips to Protect Yourself from Identity Theft
Here are seven tips to help you protect yourself against identity fraud:
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Guard your social security card and number like a junk yard dog! Remove the card from your wallet—leave it in a safe place at home or in a safe deposit box. If you have other cards that include the number, but you want to carry them all the time (such as health insurance), consider carrying a copy of the card, with the number blacked-out, instead of carrying the actual card.
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Never print your social security number on your checks or share it with any person or company that you don’t trust 100%. There are only a handful of situations where you might need to reveal the number, such as for new employment, opening accounts with financial institutions, tax-related matters, or applying for credit or insurance policies. If you must submit your social security number online, look for the closed padlock symbol on the bottom or top of the webpage that indicates it’s a secure connection. Click on the padlock to determine if the security certificate is up-to-date.
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Never use your social security number, or any part of it, as your user name or password for online accounts. If a password was automatically issued to you using those numbers, be sure to promptly change it.
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Sign all new credit cards right away and never carry any financial cards, checks, or ID that you don’t need to.
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Take your credit and debit card receipts from all purchases, match them to your statements, then shred them before putting them in the garbage. And speaking of shredding…
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Shred all documents that have any personal information or account numbers on them, including unwanted credit card offers. That way the only thing those dumpster divers will get is dirty.
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Follow up on missing statements or bills. If they haven’t arrived in the mail, it could indicate that someone has changed your mailing address. Consider going paperless with e-statements and e-bills when possible.
We must stay informed to keep our identities and our money safe. Sojoin me again next week for more tips on this important topic. And for tips on generating safe passwords to keep your online information safe please check out this episode of the Get-It-Done Guy’s show.
Be alert for all forms of identity theft with my Quick Tip on preventing medical identity theft.
Administrative
Chi-Ching, that’s all for now, courtesy of Money Girl, your guide to a richer life.
More Resources:
Federal Trade Commission: Deter, Detect, and Defend Against ID Theft
Image courtesy of Shutterstock
About the Author
Laura Adams received an MBA from the University of Florida. She’s an award-winning personal finance author, speaker, and consumer advocate who is a frequent, trusted source for the national media. Money-Smart Solopreneur: A Personal Finance System for Freelancers, Entrepreneurs, and Side-Hustlers is her newest title. Laura’s previous book, Debt-Free Blueprint: How to Get Out of Debt and Build a Financial Life You Love, was an Amazon #1 New Release. Do you have a money question? Call the Money Girl listener line at 302-364-0308. Your question could be featured on the show.