Identity Theft Archives - FinMasters

5 Best Identity Theft Protection Services for 2024

Tomas Laurinavicius — Thu, 15 Dec 2022 17:00:54 +0000

Identity theft is financially and emotionally devastating. Many victims need months or even years to recover, especially when theft is detected late. Identity theft protection services help avoid these scenarios by providing tools that help to prevent or quickly detect identity theft.

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Identity Theft: A Comprehensive Guide to Prevention and Protection

Marija Perinic — Tue, 21 Jun 2022 10:00:20 +0000

Identity theft, a crime where someone impersonates you using your personal data for monetary gain, involves stealing your name, surname, passwords, Social Security number, address, phone numbers, email address, and details from credit cards, passports, ID, and driver’s license. This is the sensitive information you need to protect.

How can you prevent, recognize, and manage identity theft effectively? Let’s explore some basic things to know about this increasingly common crime and how to safeguard your identity.

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6 Common Identity Theft Scams and How to Avoid Them

Steve Rogers — Tue, 26 Jul 2022 12:06:31 +0000

Imagine discovering that your identity has been stolen. You were conned into giving out personal information to sources that seemed legitimate, maybe on social media or over the phone. Situations like this are not uncommon and are becoming some of the most common identity theft scams.

The Federal Trade Commission receives an average of 2.4 million reports of fraud every year^[1]. An ever-rising percentage of these involve a category of fraud known as social engineering. This involves tricking someone into thinking the scammer is a friend or a representative of a legitimate and trusted organization. The objective is to steal your personal information and use it against you.

If you’re not careful, you may not realize what is happening until it is too late. Being aware of all the scams out there puts the odds in your favor. Here are some of the most popular identity theft scams to watch out for.

The Changing Form of Identity Theft Scams

The face of identity theft is changing rapidly. Fraudsters are moving away from the old methods such as dumpster diving, wallet theft, and mailbox raids. They’ve discovered that they don’t need to steal your identity if they can persuade you to give it to them.

The goal is to make you comfortable so will relax and let your guard down. This is when you are most vulnerable and most likely to give out your information. There are several ways they achieve this.

1. The One-on-One Relationship

A one-on-one relationship scam typically starts with an online meeting, but can also involve the telephone or mail. The scammer approaches you as a potential love interest or friend. You’re flattered. Once you let your guard down, the scammers make their move.

Example

The Tinder Swindler (Shimon Hayut) is a classic example of this, made famous by a Netflix documentary. Hayut posed as the son of a billionaire diamond dealer, using money from previous marks to make an impression. He used Tinder to form romantic connections and gain the trust of his victims before creating excuses to gain access to their finances.

Hayut lived lavishly spending the proceeds from each of his victims. He would seek out new women on Tinder and do the same thing to keep up his lifestyle. Law enforcement did not become actively involved until Hayut had stolen $10 million.

This is a high-profile example, but romance scams overall are all over the internet and reported losses rose 80% to $547 million in 2021^[2].

Romance scams aren’t the only kind of relationship-based fraud. Watch out for “affinity fraud”, where a scammer tries to get close to you by pretending to share your religious, political, or other interests.

How to Protect Yourself from Relationship Scams

The best way to avoid these scams is simple caution and common sense. It’s flattering to have a person with an attractive profile picture pop out of nowhere pretending to be madly attracted to you. It’s exciting to have engaging new friends that seem interested and attentive.

We still have to be realistic. If someone is just a little too interested and too available, the red flags should go up. Be careful, and if someone asks for money or personal financial information, cut the relationship off. That can hurt, but getting robbed hurts a lot more.

2. Phishing

Scammers often impersonate a person or an organization. This is called phishing. They want you to believe that there’s a problem and that the person you’re talking to can fix it. This might be an issue with your bank or investment accounts, Social Security, Medicare, or almost anything else.

Of course in order to “help you”, the friendly customer service representative will need sensitive information like your Social Security number, account numbers, and even passwords.

Once the scammer has all of the information they will steal your identity and use it against you. They might empty your accounts, take out loans in your name, or even sell your personal information on the dark web.

Sometimes, these scammers will call you on the telephone and say they are from a government agency. For example, a scammer calls you stating they are from the Social Security Administration. Any call, email, or SMS that you didn’t initiate could be an attempt to get access to your personal information.

Remember that these scammers may only need a few pieces of information. They can fill in the rest from public sources, often your own social media pages and public directories.

Protect Yourself from Phishing

If you get a suspicious call, hang up and call the organization directly. You can find their phone number by doing a Google search and contacting the organization. If the caller is pretending to represent your bank, credit card company, or another company you do business with, use the customer service number on your account documents.

Do not give out personal information over the phone, especially if you did not initiate the conversation. Government agencies and companies will not just call you and ask for personal information.

3. SMS Phishing

SMS phishing uses SMS messages claiming to be from a legitimate company or government agency. There is a message stating that something is happening with your account or personal information. It often says that your account is at risk of being closed.

There’s usually a link in the message. Don’t click it! It may lead you to a site that steals your information or places spyware on your devices. It may simply open you up to an attempt to win your trust. Either way, you don’t want it.

When you receive texts like this don’t open them. Don’t respond to anything they are saying. If you are really concerned, look up the organization’s telephone number and call them directly. The odds are high that these unsolicited texts are identity theft scams.

4. Tax Scams

Tax scams use the telephone, emails, and SMS messages that claim to be from the Internal Revenue Service (IRS). The callers claim that you owe back taxes and must pay immediately. They may threaten you with prosecution and jail time if you don’t comply. They want you to panic and send them money.

Don’t fall for it. The IRS will not call you if you have tax arrears. They will send you written notice. Hang up and don’t respond. If you’re concerned that you might have a problem with the IRS you can contact them yourself and clarify whatever issue exists.

A caller may also claim that your file lacks some information and they need to update it. Don’t fall for that either. The IRS is not going to call you up and ask for your personal information!

5. You Won! Lottery and Investment Schemes

Lottery and investment scams are extremely common. You will receive calls, emails, and texts about a huge investment opportunity or a prize that you have mysteriously won. These scammers may ask for bank details or other personal information or they may demand that taxes or fees be paid upfront before you can claim your “prize”.

Keep it real. Ignore the messages.

Here’s a simple rule: if it sounds too good to be true, it’s not true. Sure, we’d all love to win a contest we never entered, but is that realistic?

6. Website Spoofing

Website spoofing is another form of phishing. it involves entire websites that are designed to look almost exactly like the websites of actual banks, government agencies, or other credible institutions.

You’ll probably be directed to the website by an equally official-looking email or SMS. Expect to see the official logo of the organization and professional-looking stock photos. Some of these websites can look very authentic.

No matter how authentic the site looks, it is fake. It is designed to convince you to provide personal information or to place spyware on your device that will gather and send personal data.

How to Protect Yourself from Website Spoofing

Any time you get an email or message from a bank or other company that asks you to visit a website, stop. Check the real URL – the web address- of the company. Compare it to the one you’ve been given. If it’s different – even by a single letter – you’re being scammed.

If you are in doubt, close the email, look up the phone number of the company, and call them. Explain the situation and ask to confirm

In most cases, if the email is unsolicited your best bet is to avoid it. Don’t even open it.

If You’re Already A Victim

If you’ve already sent personal information to a suspicious caller or site, or you’ve already clicked on a link you think may be risky, you’ll need to take action at once. Many people hesitate to report identity theft scams because they are embarrassed or ashamed at falling for something that in retrospect seems obvious.

Thieves count on that attitude. It protects them and keeps their victims vulnerable. Don’t cooperate. If you act quickly you can prevent or minimize damage.

We’ve written about what to do if you’re a victim of identity theft, and those steps are worth following even if you think you may have been targeted. Better safe than sorry!

You Can Stop The Scams!

Many identity theft scams built on social engineering straddle the line between identity theft and a straight con. Some scammers won’t even bother stealing your identity: they will just talk you into giving them money. Others embrace a more traditional identity theft model, pursuing information that can be used or sold.

Either way, the scam is built around trust. Identity theft scammers will often use social media to learn about your life, giving them the information they need to build a persuasive pitch. You can protect yourself by keeping your privacy settings strict and not posting revealing information on any public account.

Be careful about accepting friend requests from people you don’t know. Once they are inside your friend list they can work through your history and learn everything they need to know to spot your vulnerabilities.

You still have the upper hand, because there’s nothing they can do unless you cooperate. If you stay skeptical and keep your guard up, you can cut them off before they come close to making their move.

The key to protecting yourself from identity theft scams is alertness. Whether you’re facing a phishing scam or an effort to build a phony relationship, you need to keep your eyes wide open and learn to spot their moves and shut them down.

Nobody wants to be suspicious all the time, but the world we live in requires it. Build up your senses and you’ll soon be able to spot the scams as soon as you see them. That’s the best way to stay safe!

The post 6 Common Identity Theft Scams and How to Avoid Them appeared first on FinMasters.

How Common Is Identity Theft? Types, Victims & Impact (2023)

Ana-Ioana Ciochia — Mon, 23 May 2022 10:00:40 +0000

Identity theft is a huge problem in the US. These identity theft statistics reveal just how big of a problem it is, and who is most affected.

Most people may think that identity theft is rare. Unfortunately, the data shows the contrary. Identity theft happens both more often and in more ways than most people presume.

The data here should help you understand how prevalent identity theft is, who are the most likely targets, and how you can protect yourself.

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What to Do if You’re a Victim of Identity Theft

Kevin Johnston — Wed, 01 Jun 2022 10:00:02 +0000

If you know or suspect that you are the victim of identity theft, you must take action immediately. You can minimize the damage if you act fast. You can get your money back and you can prevent further loss.

Schools and businesses have fire drills to practice what to do in case of a fire. It is just as essential to know in advance what you should do in case of identity theft.

Let’s look at what you should do if you suspect – or know – that your identity has been stolen.

Notify Companies

Many forms of identity theft involve companies, often financial service providers. You may discover an unauthorized charge on your credit card or a withdrawal from your bank account that you didn’t make.

You might even find that a loan has been taken out in your name, or that you’re being billed for medical services that you didn’t use.

In any of these situations, get on the phone with the company involved. Ask for the fraud department and describe the unauthorized activity and how you discovered it. They will have a procedure in place to deal with the situation.

Have any written evidence, like an account statement or bill, with you when you call.

Note: The identity theft recovery process will involve multiple calls. Always make a note of the date and time of the call, the name of the person you spoke to, and what they told you. It’s important to stay organized and document all communication.

Don’t be nervous about calling. You’re an innocent victim. Companies want to hear from you the moment you suspect fraud. This helps them prevent losses. Reporting fraud to a company does not cost you anything. The sooner you report the fraudulent charges, the more likely you are to recover your money.

Change all of your account login information, such as passwords and PINs. Do this for all of your accounts, and never use the same password for each one. Otherwise, a thief with your login information may access your money and credit at every institution you do business with.

Different companies have different procedures. Once you have reported the unauthorized activity, follow the instructions and supply any requested information. You will not be held liable for charges or accounts you didn’t open.

Report the Theft

After calling the individual companies, it’s time to contact organizations that can help you document and resolve your identity theft problem.

The Federal Trade Commission (FTC) provides a form for you to fill out to start the process of reporting identity theft. You can create a recovery plan and get a copy of your identity theft report.
File a local police report. Go to your local police precinct and ask to file a report. Bring your FTC Identity Theft Report, personal identification, and any evidence of your identity theft.
File any other necessary reports. For example, your local police may recommend filing a report with your state’s Attorney General’s office or financial regulator.

Keep copies of all of your reports. If you have to defend your fraud claims, it will be important to show that you took proper and immediate steps. The legal system favors you, the fraud victim, especially when you do your part.

If you have not filed appropriate reports you may raise suspicion about whether your claims are valid.

Always keep all records and documents related to the theft. For example, keep any bills, statements, or demand notices related to the fraudulent charges or accounts.

Protect Your Credit

Once you have notified the FTC, the police, and any other official agencies, you’ll need to work with the credit bureaus to make sure that the identity theft does not damage your credit.

You can call the following toll-free numbers to report identity theft to the credit bureaus.

Experian 1-888-397-3742
Equifax 1-800-525-6285
TransUnion 1-800-680-7289

You only need to call one; the information will be supplied to the other credit bureaus. You will reach an automated system, where you will be prompted to provide information to identify yourself and describe your problem.

Each of the credit bureaus will place a 90-day fraud alert on your credit file, which will prevent identity thieves from opening new accounts. Each bureau will send you a letter confirming the fraud alert and giving you instructions on how to get a free copy of your credit report.

When you get the free copies of your credit reports, examine them carefully and report any unauthorized accounts. They will be removed from your credit record.

Stop Future Identity Theft

If you have suffered one case of identity theft, your personal information has been compromised. A thief has it and could use it again. It could also be for sale. Stopping what has already happened is only half the battle.

Here’s what to do to protect yourself.

Protect Your Personal Identifiable Information (PII).

PII means data such as Social Security numbers, account numbers, passwords, your name and address, and your email addresses.

If someone has acquired some of your information, they will target you to try and get more. The more information they have on you the easier it will be to impersonate you. You’ll need to be extra vigilant. Read about how to protect your PII.

Ask For Notifications From Credit Card Companies

Many credit card companies already notify their customers if unusual activity appears. Make sure yours does that. However, some companies offer additional monitoring on your social security number or other identifying numbers worldwide. If any unusual use of your identity shows up, you receive a notice. Sign up for this service if you can.

See if You Already Have Credit or Identity Theft Monitoring

Many financial service providers bundle credit monitoring or identity theft protection with other services. Check with your bank or credit union, credit card providers, and any other financial service providers that you use. If they offer these services, sign up for them.

Place Restrictions on Your Credit Record

You can place a fraud alert on your credit reports. This will put the credit bureaus on alert and notify anyone checking your credit that they need to verify any credit application with you. Contact all three bureaus to place your fraud alerts.

All types of fraud alerts are free.

Here are the types of fraud alerts:

1. Extended Fraud Alert

This alert lasts seven years, though you can have it removed from your credit reports any time you want. This action attaches a note to your credit reports notifying businesses that you were a fraud victim. Companies must call you and verify your identity before issuing credit in your name.

You will not receive credit card or insurance offers for five years.

You will need a copy of a police report or an FTC report to qualify for an extended fraud alert.

2. Temporary Fraud Alert

This alert lasts one year. You do not need an FTC or police report to get it. Just ask your credit bureaus for this service.

3. Active Duty Alert

This works the same way as the other fraud alerts but is provided for active military personnel. It lasts one year. You won’t get any credit card or insurance offers for two years.

4. Credit Freeze

A credit freeze differs from a fraud alert in that it prevents anyone from viewing your credit scores and your credit history. You have to lift the freeze to allow anyone to check your credit. This service is free.

You do not pay a fee to unfreeze your credit accounts, but you must individually lift the freeze at all three bureaus. This does not hurt your credit score.

You will have to lift the freeze if you want to apply for credit or if someone has a legitimate reason to check your credit.

Inform Companies You Do Business With

If one of your accounts has been compromised, others might be at risk. It’s a good idea to inform all companies where you have credit lines or where you do regular business that your identity has been compromised and that someone may try to use your account.

This includes credit card providers, stores where you have credit, lenders where you have accounts, phone companies, and utility providers.

Be Vigilant

If your identity is compromised, all of your accounts are at risk. Check all of your credit card and bank statements regularly and carefully. If you receive paper statements, watch out for any that do not arrive: they may have been redirected to another address.

Use online statements with any providers that offer them, and check them frequently.

Tip: If you notify companies of fraud the moment you see it, you will probably have the transactions removed from your account and have your balance restored to the pre-fraud level. Waiting can limit your recovery chances.

Hire a Service to Prevent and Repair Identity Theft

You can subscribe to professional identity theft services that monitor the use of your identity online. Some of these services will even make up for any loss you incur through identity theft. These companies can be faster than credit bureaus at identifying problems and addressing them, and their loss insurance can pay for itself.

Some will even help you hide your identity online, and give you a personal representative to help you repair your credit in the event your identity is stolen.

Rates range from free to quite expensive, depending on the level of service provided. Assess your risk and select a service that provides the protection you need at a price you can afford.

Don’t Panic, Act!

Discovering that someone has stolen your identity can be traumatic. Some victims freeze and do nothing. That won’t help. Remember that you are a victim of a crime, you’re not the only one, and there are systems in place to help you.

The problem won’t go away, and the longer you wait the worse it will get. If you are a victim, follow the steps above at once! The sooner you act, the sooner you can put the theft behind you and move forward.

The post What to Do if You’re a Victim of Identity Theft appeared first on FinMasters.

6 Early Signs of Identity Theft to Look Out For

Nick Gallo — Wed, 18 May 2022 10:00:54 +0000

It turns out that The Office’s Dwight Schrute was right. Identity theft is not a joke, and millions of families experience it every year. In 2021, 42 million United States consumers were victims of identity fraud, resulting in total losses of $52 billion^[1].

Fortunately, catching identity theft early on can significantly reduce the damage from your information being exposed. Here’s what you should know about detecting the signs of identity theft, plus some of the best ways to prevent it.

How Does Identity Theft Happen?

Identity theft refers to any incident where a third party steals your personal data and uses it for financial gain. While there are countless ways for thieves to get hold of your information, they generally fall into one of two categories:

Traditional identity fraud: These tactics involve physically or digitally stealing your data without contacting you directly. If you’re ever a victim, you may never find out how the thief obtained your information.
Identity fraud scams: This approach involves directly contacting you and tricking you into giving up sensitive information. As a result, you should know when the thief stole from you and what details they have.

Traditional strategies include stealing documents from your mailbox, trash, or wallet, taking advantage of data breaches, and attaching skimmers to electronic card readers that record your payment details when you swipe.

Identity fraud scams often involve contacting you through the phone, email, or social media and conning you. They might try to convince you to give up your information by promising you a prize, threatening you with arrest, or posing as an attractive individual and expressing romantic interest in you.

This is far from a comprehensive list of ways that thieves can steal your information. It’s impossible to learn all the fraud permutations, but it’s worth reviewing the most common to recognize the pattern better.

Early Signs of Identity Theft

Identity theft can take a long time to notice if you’re not proactively looking for it. Unfortunately, every day the issue goes undetected, the more likely the damage will be significant and take longer to fix.

As a result, you must learn the most common signs of identity theft to catch the problem as early as possible. Here are some of the primary red flags.

1. Unauthorized Account Activity

One of the ways people frequently discover identity theft is by finding transactions they don’t recognize in their credit card or bank account statements. That’s a sign someone has gained access to your account and is using it to make unauthorized purchases or withdraw funds.

The amounts won’t necessarily be significant at first. Thieves often start by making smaller purchases to test the accuracy of their information and confirm that they can complete transactions with your account.

2. Unfamiliar Accounts in Credit Reports

Another way people often discover they’ve suffered from identity theft is by finding strange accounts in their credit reports. That’s because one of the most popular ways thieves profit off your personal information is to create credit accounts in your name.

For example, they might steal your information by going through your trash and finding one of your credit card statements, then use it to apply for a new card. They’d then max out the account and vanish, leaving you to deal with the bill.

3. Missing Bills

Whether you receive your monthly bills through email or snail mail, identity thieves that access your accounts may redirect your correspondence to an address they can access. If you haven’t received a copy of one or more bills in recent months, it may indicate someone is trying to steal your identity.

If thieves get ahold of your bills, they may be able to use the information in them to commit identity fraud. Alternatively, they may be trying to hide their own activity while they’re racking up charges on the compromised account.

4. Unfamiliar Bills or Correspondance

I don’t consider this an “early” sign of identity theft, but it’s still worth mentioning. If you get bills for expenses you don’t recognize, unexpected calls from debt collectors, or letters about unfamiliar activities, it’s very likely someone has stolen your identity.

Keep in mind that there are many ways this can manifest, including some you might not expect. For example, thieves may use your information to claim unemployment benefits, get healthcare services that are billed to you, or open utility accounts.

Unfortunately, this often means that the issue has progressed significantly. As a result, you should never ignore a letter or a bill you don’t recognize because you think it’s just a mistake or a mix-up.

5. Inability to File Your Tax Return

One of the increasingly common ways identity thieves profit from stolen information is by filing fraudulent tax returns and stealing refunds. Many people find out about this when they file their return and get rejected because someone already submitted one using their Social Security Number.

Alternatively, you may receive unexpected correspondence from the Internal Revenue Service (IRS). That could be a letter asking questions about a potentially fraudulent return, a tax transcript you didn’t request, or a notice stating someone created an online account with the IRS in your name.

Learn More: Filing your taxes can be intimidating, especially if it’s your first time. If you need help, check out our comprehensive guide: Filing Taxes for the First Time? Here’s What to Do!

6. Company Data Breaches

Unfortunately, even if you do everything you should do to protect your identity, you’re not the only party identity thieves can target to steal your information. Your data is a hot commodity, and companies hoard as much of it as possible these days.

If a business with your data suffers a breach, you may be exposed through no fault of your own. Legally, organizations are required to notify you of these incidents. If you receive notice that your information is compromised, it’s definitely a sign you need to take action to avoid victimization.

How to Check for Identity Theft

You should always do your best to prevent identity theft before it happens, but sometimes it’s unavoidable. As a result, checking to see if you’ve been a victim of identity theft is something you should do regularly.

Given the signs of identity theft I mentioned above, some of the best ways to check for identity theft are:

Review your bank account and credit card statements for unfamiliar activity
Check your credit reports for tradelines you don’t recognize
Monitor your correspondence to make sure nothing’s missing or unexpected
Watch for data breaches at companies that may have your data

It’s not a substitute for looking for signs of identity theft yourself, but identity theft monitoring services can make finding potential red flags easier. After all, it’s unlikely that you’ll be checking for all of the issues noted above daily.

However, these services typically aren’t free and have limitations, including an inability to detect all of the ways your identity could become compromised. As a result, while they can be helpful in some circumstances, they’re not beneficial for everyone.

How to Prevent Identity Theft

Unfortunately, nothing you do can guarantee that you won’t suffer from identity theft. As a result, you always have to keep a watchful eye out for signs that someone has stolen your identity.

However, there are ways to greatly diminish the chances that someone will acquire your personal information. Here are some best practices you should consider.

Secure Your Online Activities

With the world becoming increasingly digital, it’s more important than ever that you learn to protect yourself while operating online. Nothing is ever ironclad, but you can significantly bolster your defenses by taking steps like the following:

Use strong, unique passwords for each account and website
Enable two-step verification using your phone or an authenticator app
Use antivirus software and keep it up to date
Learn not to click on links that might be unsafe
Monitor your social media data and privacy settings
Avoid public wifi or use a virtual private network

Again, it’s impossible to eliminate the risk that someone will steal your data online while taking advantage of all the internet offers. However, you can reduce your vulnerability with these precautions. If you haven’t in a while, spend some time brushing up on internet safety.

Practice Good Habits in the Real World

Unfortunately, there are just as many opportunities for thieves to steal from you in person as online. Here are some ways you can minimize your vulnerability as much as possible:

Sign up for electronic billing statements
Secure your snail mail with a P.O. Box or drop-in mailbox
Buy a shredder and destroy documents before throwing them away
Avoid carrying sensitive data on your person
Get a safe to store documents like passports in your home
Check for skimming devices or use mobile payment apps instead of cards

It’s hard to eliminate all physical copies of your sensitive information. After all, you need hard copies of things like your driver’s license and passport, and most people are unwilling to dispose of their credit and debit cards. However, reducing your reliance on physical data will often help protect you against identity theft.

Cultivate a Skeptical Mindset

Taking steps to guard your personal information in the physical and digital worlds is essential to minimizing your exposure to identity theft, but it’s not sufficient. It doesn’t do anything to protect one of the most vulnerable points in your security: yourself.

As identity theft protections improve, thieves are increasingly scamming consumers directly rather than hacking into their accounts or digging through their trash for information.

Educating yourself on the tactics they use is helpful, but you’ll never be able to learn about them all. There are countless strategies already, and scammers invent more every day.

As a result, your best defense against these con artists is to build a habit of being suspicious whenever someone wants access to your information. It should be an automatic reflex, even when you’re dealing with someone you’re confident is legitimate.

Learn More: As the old saying goes, an ounce of prevention is worth a pound of cure. Check out our favorite tips for preventing identity theft before it happens: 12 Essential Steps to Prevent Identity Theft.

Take Action If You See Signs of Identity Theft

If you’ve seen warning signs that indicate someone may have stolen your identity, take action immediately. Remember, identity theft issues usually take longer and cost more to resolve the longer they go unaddressed. You can read more about what to do if you are a victim of identity theft here.

For assistance with the recovery process, visit IdentityTheft.gov. It’s a federal resource that lets you report the details of your incident to the proper authorities, then creates a personalized recovery plan and walks you through each step.

The post 6 Early Signs of Identity Theft to Look Out For appeared first on FinMasters.

12 Crucial Steps for Protecting Yourself Against Identity Theft

Kevin Johnston — Wed, 04 May 2022 10:00:00 +0000

Identity theft can be devastating. Victims may lose money, see their credit destroyed and spend a lot of time trying to re-establish their financial accounts. They could even be forced to prove their innocence of crimes committed in their name.

That can seem pretty scary, but you don’t have to become a security fanatic to protect your identity. You can prevent identity theft by following a few basic steps. The protection won’t be absolute but you can put the odds in your favor.

Like most criminals, identity thieves look for easy targets. Here’s how to make yourself a hard target.

PII: the Key to Identity Theft

PII stands for Personal Identifiable Information. This is any data that would allow someone to impersonate you.

PII includes key elements like your Social Security number, account numbers, and passwords, but it also includes mundane details like your full name, phone number, and email address.

Identity thieves work by acquiring parts of your PII and using open sources to fill out a profile that they can use to impersonate you. Protecting your PII is the key to protecting yourself from identity theft.

Let’s look at some ways to protect your PII and prevent identity theft.

Prevent Identity Theft by Securing Your Bank and Credit Card Information

Many people imagine identity thieves as high-tech hackers, manipulating the internet and using computer wizardry to steal your PII. The real methods are often much more mundane. Here are some simple tips.

1. Beware of Dumpster Dives and Mailbox Raids

One of the most common and effective ways to steal PII is “dumpster diving”. Thieves prowl through garbage to recover bank or credit card statements or other mail (even bills) that people have casually thrown in their wastebaskets. Once they have your account and balance information, they can pretend to be you when contacting your bank or credit card company.

Shred your paper statements or other documents containing personal information before discarding them so no one can dig through your trash and get them.

Thieves may steal your statements from your mailbox before you ever see them. Maintain a secure mailbox or have your bills sent to a P.O. box. Use electronic statements with secure passwords whenever possible.

2. Remove Personal Documents From Your Wallet or Purse

You might think it is convenient to keep your personal information in your wallet, but if it gets stolen or lost, thieves can use the information to steal your identity, use your credit cards, and empty your bank accounts.

Don’t carry these items:

Social Security Card The number on this card is the key to getting into most of your accounts. Thieves can get loans and credit cards in your name.
Passport A passport is a government-issued legal document. Criminals can use it to get new identity cards and open new accounts. And of course, they can travel in your name.
List of your passwords. This list gives cybercrooks all they need to take over your online identity.
Blank checks If you lose a blank check, a criminal can drain your bank account or use the information to enter your account electronically. These days, few purchases are made by check, so leave your checkbook at home unless you know you will need it.
Birth Certificate This document will allow thieves to combine it with other fake I.D.s to convince someone to open an account in your name.

Not all identity theft is electronic. Think about what you really need to carry and leave the rest at home.

Tip: Change your passwords frequently and do not use the same password for all of your accounts.

3. Watch Out for the Old Fashioned Con

One of the most common and popular forms of identity theft and fraud is social engineering. This is essentially an old-fashioned con job. As con artists have always done, social engineering scammers gain your trust and persuade you to give up PII – or even money – voluntarily.

Identity thieves may contact you by phone, email, or text. They will often impersonate employees of financial institutions or other businesses. The request will sound innocent: maybe they need to verify a transaction or confirm account details. Some may use a reward or prize as bait or warn you that your account will be closed if you don’t take action.

Your best security measure is to never give out PII online unless you know the institution and you initiated the contact. It is rare for reputable companies to contact you asking for information about yourself. If you have any doubts, check with the company.

Tip: Read your credit report regularly. An account or inquiry that you don’t recognize could be an early sign of identity theft.

Social engineering scams can take many forms.

Phishing involves using emails, text messages, and websites, often using the name or visual identity of a real institution, to convince you to give up details.
Baiting uses emails or messages promising a reward, prize, or other incentives to get you to surrender PII.
Romance scams involve criminals taking on the identity of physically attractive people and convincing their marks to strike up an online “relationship”.
Affinity fraud involves scammers that gain trust by pretending to be a member of a social group, like a church or club, that the mark belongs to.

All of these scams rely on our tendency to trust people who seem superficially trustworthy.

Data Highlight: Losses due to romance scams amounted to $547 million in 2021.

4. Watch for Pressure to Provide Your PII

Any time you have to “act now” or hurry in any way, you are dealing with a scammer. You may hear a warning that you will lose money if you don’t act during the call.

There is even a fake IRS scam where the caller tells you that police are on the way to arrest you for tax fraud, and you can only prevent it by giving them information to stop it. The IRS never does this, nor does any respectable company.

Prevent Identity Theft by Paying Attention to Online Security

Many forms of identity theft don’t take place through “hacking” or other computer-related activities. Some do, and you’ll still need to pay attention to online security in order to prevent identity theft.

5. Never Post Private Information in Chatrooms or on Social Media Sites.

Even something as simple as your home address can give a criminal an “in” with you. Because they know your address, you may think they are legitimate. And, of course, posting account numbers and bank balances and the like will give them powerful information they can use to gain your trust. Even just posting your bank’s name will let people know who you do business with, and they may call you pretending to be from that bank.

Thieves may also use information from your social media to order goods and services, open shopping accounts, and even steal from others by using your name.

6. Avoid “Friendships” That Move Too Fast

Online relationships may invite identity theft. Romance scams are everywhere online. Criminals pretend to be attractive men or women and act like they feel close to you. This usually occurs over a period of days, with the scammer suggesting you will know each other forever because you are so much alike.

At some point, the scammer may ask you to move to Whatsapp to continue the conversation. This provides them with end-to-end encryption to protect them from the prying eyes of social media administrators. You may be “helped” to get into cryptocurrency (the account will be fake and they will take your money). Or they may ask to buy a phone card or send money for a medical operation.

Ask for a video call. Most scammers will drop you immediately. They will refuse to do anything that would reveal their true appearance.

7. Watch for Suspicious Websites

Beware of clicking on websites that are trying to steal from you. Often, a link with some “amazing” offer will take you to a site that immediately asks you for personal information so you can take advantage of their deal. That’s usually a bad idea.

Some sites may direct you to links that will install malware on your computer. Never click on a link unless you’re sure you know where it goes.

A fake website may look very much like the real one but will have a different web address or URL. Always check the full URL to see if it has misspellings or belongs to a domain other than the company’s. A fake may be different from the real thing by only one letter. Look up the company on Google to see the proper URL.

Tip: You can check the legitimacy of a URL with Google. Type in http://google.com/safebrowsing/diagnostic?site= followed by the site you want to check. The tool will tell you if the site is known for installing malware on users’ computers.

8. Check Email Addresses on Customer Service Emails

You may receive an email regarding an account you have with a company. Typically, the email will ask you to verify your information, including account numbers and passwords.

First of all, legitimate companies never send an email out of the blue asking you for sensitive information. Secondly, check the return email address. Scammers use random addresses that don’t match the official email address of the company. You should see a domain name that is the official company domain.

If you aren’t sure, look up the company’s customer service number online and call to verify. Never use a number contained in a suspicious email or message.

Warning: Pay attention. Email scammers often alter a letter or two to make the email address look like the company’s real address. An “a” may be substituted for an “e,” for example.

9. Beware of Unrequested Antivirus Downloads

When you get popup windows that claim you have a virus, they may tell you that you need to install an antivirus program. Never download this kind of software offered to you out of the blue. You will likely infect your computer with malware that can take over, ruin your files, or send critical data to an identity thief. Only install antivirus software from reputable companies you seek out, not offers that randomly appear on your screen.

When you are on a legitimate site but unrelated offers pop up in your window, the site may have been hacked. Clicking on these offers may introduce malware into your computer. If you see offers that are unrelated to the company, don’t click on them.

It’s best to only click on links that you deliberately sought out.

10. Use Secure Passwords

This sounds simple, but millions of people are still using highly insecure passwords, even on accounts that involve money, like banking, credit cards, and e-commerce accounts. Using random passwords and changing them regularly is one of the most basic ways of preventing identity theft.

If you’re worried about forgetting your passwords, look into password management software!

11. Use Two-Factor Authentication

Two-factor authentication is a simple system. Every time you sign in to an account or make a transaction, you’ll have to enter a one-time PIN number sent to your phone number or email address. That makes sure that nobody can access your details or make transactions in your name unless they have not only your login details but also your phone or email.

Two-factor authentication is not foolproof and it may seem inconvenient, but it gives you an extra level of protection. Many financial and e-commerce sites offer this service, and it’s worth using any time it’s available.

12. Freeze Your Credit

A credit freeze will prevent anyone from gaining access to your credit file. This makes it impossible for identity thieves to apply for credit in your name. Many people request a freeze if they think their information has been compromised, but if you rarely apply for new accounts you can choose to keep a freeze in place. Just remember to lift the freeze if someone has a legitimate reason to check your credit.

Protection for your PII

Most people can protect their own PII in order to prevent identity theft. The methods outlined in this article will give you a layer of security and make you a difficult target for identity thieves.

If you believe that you’re at high risk of identity theft or your PII may have already been compromised, you can consider hiring professional services to protect your identity. These services are available on two main levels.

Credit monitoring services watch your credit file and alert you if there are any changes that could be caused by identity theft. This will not help you with types of identity theft that do not involve credit accounts. Many financial companies bundle credit monitoring with other services, so check your credit cards and accounts before paying for credit monitoring.
Identity theft protection services provide more assertive protection. Many services will go beyond credit reports, monitoring address change requests, court and arrest records, service applications, social media activity, and even dark websites where PII are often sold.

These services can give you extra protection, but they may also come at a substantial cost. You’ll have to assess your risk carefully before making the decision to spend more. For most people, taking the simple steps we’ve reviewed above is likely to be enough!

The post 12 Crucial Steps for Protecting Yourself Against Identity Theft appeared first on FinMasters.

Is Identity Theft Protection Worth It?

Aditya Raghunath — Wed, 28 Dec 2022 17:00:56 +0000

Keeping your personal information secure is becoming extremely challenging in our increasingly digitized world. Identity theft is soaring, and the market for identity theft protection is soaring with it. But is identity theft protection worth it, and do you need it?

What is Identity Theft?

Before we delve into the details, let’s understand what identity theft means. The umbrella term covers crimes committed using a person’s personal identifying information (PII), such as social security numbers, driver’s licenses, debit and credit card details, passwords and PINs, banking information, and much more.

Identity thieves can exploit such data by opening new bank accounts and lines of credit using your information. Criminals could make unauthorized withdrawals or transfers from your account or make illicit and unauthorized purchases through stolen card details. They could obtain medical care using your insurance details or file a tax return in your name and claim your refund. They may simply sell your information to others.

You might not even realize that you are a victim of identity until much later when the damage is already done. Not only can this lead to substantial economic damage, but it might also even lead to an arrest warrant being issued in your name.

Many people assume that identity thieves are high-tech “hackers,” but that’s often not the case. Many thieves get personal information by raiding mailboxes, sifting through garbage, looking for discarded statements, or calling victims up and impersonating a representative of a financial institution.

There are multiple types of identity theft and methods thieves use to steal your identity. You can protect yourself by knowing the signs of identity theft and what to do if you’re a victim. Some people want or need additional protection, and that’s where identity theft protection services come into the picture.

Did you know: In 2021 alone, 1,434,698 Americans reported identity theft.

What Do Identity Theft Protection Services Include?

Identity theft protection services monitor public databases, social media, and the dark web to find out if a customer’s data is published there or not. They also monitor customers’ credit reports to identify unusual activity and send requisite alerts. Theft protection agencies typically offer three-bureau monitoring services to ensure prompt identification of any out-of-the-ordinary transactions or activity.

Identity theft protection services can detect many complex fraudulent activities that you might not pick up yourself, such as falsified invoice frauds, which will most likely pop up on a monitoring agency’s radar. Such theft agencies employ seasoned trackers that can generally sniff out any suspicious activity as soon as it occurs, thereby allowing clients to minimize losses.

Identity Theft Protection vs. Credit Monitoring: Which is Better?

Credit monitoring focuses exclusively on the surveillance of credit reports. The majority of personal identity theft involves financial data breaches, which are likely to appear on the victim’s credit reports.

Identity theft protection services provide much more comprehensive scrutiny. They can track and report identity theft before it appears on credit reports, making them more effective. They can also detect forms of personal identity theft that do not involve credit transactions, such as direct debits from bank accounts, crypto scams, tax identity theft, and the sale of personal information on the dark web.

Identity theft protection is also much more expensive than credit monitoring.

Credit monitoring is often free. You can monitor yourself directly simply by reviewing your credit reports on a regular basis. Many bank accounts, credit cards, and loans also bundle credit monitoring with their account perks. Before you pay for credit monitoring services, see if you’re entitled to get them for free.

The Bottom Line

Identity theft protection is comprehensive, effective, and expensive. Do you really need it?

Is Identity Theft Protection Worth It?

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If you believe you are a victim of identity theft or have had any confidential document stolen, or if you have reason to believe that you are at risk or that information has been compromised, it might make sense to opt for a comprehensive theft protection package. The platforms, which track social media, public databases, and the dark web, and monitor your personal accounts, can alert you instantly in case of any suspicious activity.

People who are not in immediate jeopardy should evaluate the pros and cons of both services before making a decision, as identity theft protection services are costly.

As more financial institutions have begun offering credit monitoring for free or bundled up with other services, low-risk individuals can protect themselves reasonably well by taking basic precautions and monitoring their credit.

The key to making the right decision for you is assessing your risk realistically and weighing it against the cost of full-scale identity theft protection.

The post Is Identity Theft Protection Worth It? appeared first on FinMasters.