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Introduction to Identity Theft Tips
Breeder Documents are “Gold Mine” to Identity Thieves
Some identity theft crimes are simple to sort out and stop, especially if they are related to credit card fraud. Closing an account and opening a new one may be all that’s necessary to erase the damage and prevent new incidents from occurring. However, if we stay true to the definition of identity theft, where thieves assume your identity and create a whole new history in your name, the crime becomes much more serious. You may find your record shows you’ve defaulted on home or car loans, filed for bankruptcy or have a criminal record with a warrant out for your arrest.
Information and credentials used for identity theft are often referred to as “breeder” documents, and they are a gold mine to identity thieves. That’s because these forms of identification, such as birth certificates, social security numbers, and date of birth, can be used over and over again to “breed” new accounts, gain credit, acquire a driver’s license, secure a passport, and on infinitum, creating a completely new history – and financial nightmare – for the unsuspecting victim.
The time spent trying to unravel the resulting wide-reaching web of deceit and falsification could take months and, for the most serious offenses, it could take years. Understanding how identity theft occurs and learning ways to protect your sensitive information is the first step to prevention.
For more information on identity theft, precautions you can take to guard against it, and what to do if you become a victim, visit the Federal Trade Commission (FTC) web site.
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IDENTITY GUARD® Tip: New-Accounts Fraud is Most Damaging Identity Theft Crime
Identity theft is one of the fastest growing financial crimes. Thanks to the Federal Trade Commission (FTC), easy access to identity theft information for prevention and protection is helping victims navigate the process for damage repair and recovery.
In recent history of identity theft crimes, the most common cases are basic credit card fraud. Using your credit card, or credit card information, the thief racks up charges on your account. Luckily, closing the account at the first sign of fraudulent activity ends the spending spree and the consequences to you are minimal. The law limits your liability to $50, and the major credit card companies dismiss all liability for fraudulent charges.
The most damaging identity theft is called new-accounts fraud. As the name indicates, the thief uses your name and Social Security number to open new accounts rather than simply trying to access and steal from established accounts. Since you are not aware of these new accounts, your credit history and scores may become extensively damaged by the time you discover the theft, such as when your application for a new loan or line of credit is turned down. One in 100 people are victims of new-accounts fraud each year.
The more devastating cases of new-accounts fraud don’t happen randomly, but rather the victim knows the criminal. To become more aware of your potential vulnerability, think about your own life and the people in it. Ask yourself if you have a coworker, friend or family member who:
Has fallen on tough times and asks you repeatedly for small loans.
May be battling a drug habit or engaged in alcohol abuse.
Hovers around your desk when you have sensitive or personal information displayed on the computer screen.
Looks over your shoulder as you write checks or review bank statements.
Studies your credit card when you use it in front of him/her for payment.
Financial hardships and desperate situations can turn trustworthy people into unlikely criminals. For more information on identity theft prevention call the FTC at 1-877-382-4357.
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How Identity Theft Occurs in the “Real World”
In the “old” days, a thief would knock you down, grab your purse or wallet, and run for the hills. And it was not uncommon to later find the discarded purse or wallet with the victim’s driver’s license and personal documents intact because all thieves wanted was your cold hard cash.
But just as quickly as technology devised a way for you to limit how much cash you carry, thieves figured out a way to take it from you.
Thieves are still knocking people down and taking their wallets and purses. But now they are after far more than a few hundred dollars tucked away in your billfold. They want your credit cards, health insurance card, ATM card, driver’s license, auto insurance card, and – the “grand prize” – your Social Security number.
Yet even if you are careful about what you carry with you, thieves come up with creative ways to pilfer your personal information. They’ll steal your incoming and outgoing mail searching for documents that contain bank account information, new credit cards, and tax documents that display your Social Security number. They’ll rummage through your trash looking for discarded documents containing sensitive information. They’ll even break into your car and grab everything you keep in the glove compartment, hoping to find credit card receipts, old bills, and any number of personal documents.
Identity theft information is becoming easier to access and the more you learn about identity theft, the better prepared you can be to deter it from happening to you. A good place to start is the Federal Trade Commission and the Identity Theft Center.
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IDENTITY GUARD® Tip: Identity Fraud Versus Identity Theft
Although information on identity theft is widely available, many consumers remain uncertain of the differences between identity fraud and identity theft.
Quite simply, identity fraud consists primarily of someone your personal information without your knowledge or consent. Identity fraud can be financial, such as unauthorized use of your credit card or conducting unauthorized transactions from your existing accounts such as bank transfers and ATM withdrawals. Identity fraud can also take a criminal shape, when someone perpetrates a crime while assuming your identity.
The definition of identity theft is when someone steals your personal identifying information, such as your name, date of birth, credit card numbers or Social Security number. While identity theft is a crime, you don’t feel the impact until the identity thief has actually done something with your stolen personal information, i.e. commits identity fraud. The challenge we face as consumers is that an identity thief can wait years before acting, catching you and the authorities off-guard.
Regardless of the distinction that can be made between identity fraud and identity theft, the recommendations for consumers to prevent and protect against them is the same and include:
· Shred documents that include personal information such as bank account and Social Security numbers.
· Install a locked mailbox.
· Review your bank and credit accounts regularly for any suspicious activity or unauthorized withdrawals.
· Opt out of prescreened credit offers. Call 888-5-OPOUT.
· Continuously monitor you’re your credit report from each of the three consumer reporting companies (Equifax, Experian, or TransUnion). You are entitled to receive one free report each year from each company. Review each one and report any errors you find.
· Continuously monitor other sources of your personal information such as public records and the Internet.
Protection of your personal information is key to prevention.
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Identity Thieves Use Pretexting to Capture Your Information
The easiest way for a thief to steal your identity is to simply call you on the phone and ask you for it. Think you’re not vulnerable to such a blatant ploy? Think again. How many times do you agree to participate in a survey? How much information do you willingly give over the phone to your insurance company, your doctor’s office or your bank? All it takes is a believable story about needing to update your records or verify your account information and – voila – a friendly, helpful sounding thief thanks you for your assistance and reminds you to “have a nice day” before hanging up the phone. And so begins his/her scheme to use that information to steal your assets or sell it to someone else who will.
This practice is called pretexting and while the most visible cases are purported to happen to the unsuspecting elderly, the truth is that thieves are nondiscriminatory. It happens to anyone willing to part with information.
Educate yourself by seeking out information on identity theft and be particularly mindful of pretexting schemes. Refuse to give out personal information over the phone, in person, by mail or through the Internet unless you are certain you know the person you’re giving the information to, or unless you made the initial contact. If you are not certain about the person asking for information, ask for his/her name, the name of the company being represented, and a phone number. Then call the customer service department for that company using the telephone number provided on your statements – not the number provided by the caller – and tell the customer service representative about the call. If it is a legitimate request you will be transferred to the correct department. If not, ask to be transferred to the fraud department to report the incident.
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IDENTITY GUARD® Tip: Identity Theft is One of Today’s Fastest Growing Financial Crimes
You may be hearing a lot about identity theft scams these days, but exactly what is identity theft?
A concise definition of identity theft is “the use of someone’s personal information without his or her knowledge.” This information is used to access bank accounts, apply for loans and credit cards, and make unauthorized purchases. Credit card fraud is the most widely known type of identity theft, but by no means where the trouble begins and ends. Identity theft is one of today’s fastest growing financial crimes.
In the “old days” identity theft was primarily a crime committed in the physical world. In addition to pilfering actual credit cards, credit card numbers were stolen from the discarded carbon copies of credit slips run through a manual credit card machine. And thieves rummaged through trash cans and dumpsters to find tossed out bank and credit card statements and any documents with personal information.
Today, in addition to new and sophisticated ways to commit identity theft offline, the virtual world provides an ever-greater opportunity for thieves to steal your personal information online with “phishing” scams. Worse yet, phishing thieves may be the ones who steal your information but, instead of using it themselves, it is sold to others on a financial black market, guaranteed to wreak havoc with your credit history.
The fact is that identity theft affects nearly 10 million Americans every year. Chances are good that, if you haven’t been a victim of identity theft yourself, you know someone who has been. Education is the key to prevention and protection from becoming an identity theft victim.
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How Identity Thieves Use Your Personal Information
As creative as identity thieves are in order to capture your information, they are just as creative in using the information to their own benefit. Here are just some of the ways your information is used by identity thieves:
Credit cards are used to purchase high-ticket items that can be easily sold.
The mailing address is changed on your existing credit card accounts in an attempt to delay the length of time it takes you to discover the theft.
New loans are applied for to buy cars or homes in your name.
New credit card and bank accounts are opened using your name, date of birth and Social Security number.
Bankruptcy is filed under your name.
Your name is given to the police during an arrest resulting in a criminal violation on your record and the potential for a warrant being issued for your arrest.
Savvy thieves can do a lot of damage in a short amount of time so your best defense is quick action and regular monitoring of your accounts and credit reports. Check your credit card and bank statement as soon as you get them for any suspicious activity. Know when your billing cycles are and if a statement does not arrive on time, contact the institution to report it. Monitor your credit report regularly. If new accounts and loans are being opened in your name, you may not learn of it for years – long after the damage is done.
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How Identity Theft Occurs in the Virtual World
There’s no denying that technology has changed how we work and play. The world is quite literally at our fingertips with computers, cell phones, and PDAs leading the way in gadgetry that we rely on each and every day. These devices allow us to bank online, pay bills and file taxes electronically, buy and sell products and services, and communicate with anyone, anytime, anywhere in the world.
All this convenience and interconnectivity also brings with it security challenges, and ID thieves are more than happy to take advantage of the opportunities we leave open to them. Viruses, spyware and keylogging software helps thieves destroy or capture information stored on our computers. Some of these programs are sent as attachments to e-mails, others may be bundled in tandem with a free offer downloaded from a seemingly legitimate site. If your computer isn’t equipped with anti-virus, anti-spyware and firewall protection, you’re an easy target. Think of it as leaving your doors and windows wide open in a high-crime neighborhood. You may not be inviting criminals to steal from you, but you’re not doing much to deter them.
Online phishing crimes are committed in a similar way as offline pretexting crimes… we volunteer our personal information. Phishing e-mails land in our in box with active links embedded that supposedly will take you to your personal account update page. These links redirect you to a fake site where you enter your login and password, and other personal account information. You’ve just given away everything a criminal needs to steal your identity.
The more you understand how online thieves attempt to steal your identity, the more you’ll be able to do to prevent and protect against it.
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Why It’s Impossible to Prevent Identity Theft
There are many preventive steps you can take to guard against identity theft. However, it is impossible to give a 100 percent guarantee that you will never become a victim. Just as we can lock our homes at night, put in a security system – or even hire an armed guard – we can decrease the chances of theft, but not guarantee it.
Part of our vulnerability to identity theft comes from the fact that our personal information is in countless computer databases and file cabinets that we don’t control. We give out personal information to get credit cards, bank loans, car loans, insurance policies, driver’s licenses and passports, and the information is in employer’s files and IRS tax filings. We have to place our trust in strangers to protect our information. That opens the door for possible theft by dishonest employees or via computer hackers who steal entire databases.
The key to prevention is to limit access to your information and, when obligated to give it, ask questions about security measures used to protect against theft. Always ask why someone needs your personal information, and how it will be stored and secured. Above all else, protect your Social Security number. The most damage from identity theft occurs when a criminal uses it to create an entirely new credit and/or criminal history in your name. Whenever possible use an alternate form of identification or verification for accounts and records.
