It may surprise you to learn that one of the most valuable things you possess didn’t cost you a dime. Nevertheless, there are people out there who will go to great lengths to take it from you – your personal financial identity. Arm yourself with some simple information and keep one of your most precious assets private.
Though related, identity theft and identity fraud are different things. It can be useful to understand the differences.
Fraud - The more common of the two, fraud is when your personal or private information is stolen or invented. The thieves use your credit card numbers or PIN, for example, to make purchases or gain access to your accounts.
Theft - The potentially more damaging of the two, theft is when thieves use your personal information – such as a Social Security number – to establish accounts for themselves in your name. This can be extremely damaging to your credit profile and impact life decisions like buying a car, purchasing a home or qualifying for financial aid for graduate school.
Shoulder Surfing – You can be observed from nearby locations as you punch in numbers on telephones, at debit pay stations, checkout stands or ATMs. Binoculars and digital recording devices make it even easier to trace your finger movements. Use your body to block anyone trying to observe as you punch numbers into keypads. Find some privacy before giving out numbers over the phone.
Dumpster Diving – Old-fashioned garbage picking can yield high returns to the criminally minded. A search through the right communal dumpsters might turn up copies of checks, credit card statements, bank statements or other records that bear your personal information. You can ruin their fun by shredding your documents before disposal. Dumpster diving is still the most common way of obtaining personal information. While your shredding credit card statements, throw all those applications into the shredder as well. Thieves easily can use these blank offers to start a new account and assume your identity.
Phishing Via Spam – The latest successful scam, “phishing” refers to those e-mails purported to be from PayPal, eBay, Washington Mutual or other financial institutions threatening to shut down your account unless you log on immediately and “verify” information. Don’t fall for it. If you receive an e-mail that you think is valid, follow up by telephone using the number from your statement or type in an e-mail address you know to be valid. Never follow the links in these e-mails, even if they look like valid addresses.
Protect Your Information – Only give out personal financial information, such as Social Security number or account numbers, to businesses you trust, and only when necessary. Not every credit application requires your Social Security number. Never give out information to telemarketers offering you merchandise, benefits or prizes. If you are interested, ask them to mail you an application. Then check up on the organization before responding.
Check Your Information – Financial accounts do not flourish from neglect. You should be receiving monthly statements from your bank and credit card accounts – check them regularly and immediately contact the financial institution if you see discrepancies such as unauthorized debits or charges.
Get Your Credit Report - Credit reports list all accounts in your name. Check for any accounts wrongfully opened in your name, and verify the information for each of your legitimate accounts. The Fair and Accurate Credit Transactions Act, enacted in 2003 and currently rolling out across the country, entitles residents of many states to a free credit report each year. Find out more at www.annualcreditreport.com.
Be aware that privacy policies differ from company to company. When you register at Web sites, read those privacy statements – you may be surprised at how much freedom you give away.
Check out these Web sites for more info on identity theft, fraud and credit monitoring:
Department of Justice
Federal Trade Commision
Credit Reports and freecreditreport.com