Identity Theft 101
First Published Date: August 11, 2010 ADawnJournal.com
One of the worst things that can happen to you, financially speaking, is to have your identity stolen. While identity theft was exceedingly rare through most of the 20th century, it has become one of the fastest growing crimes in the world in the 21st century. Identity thieves have a plethora of ways to steal your identity and it can often be very difficult to handle your credit after an identity thief has attacked it. Throughout this article, I will show you what you need to know about identity theft, what you need to do to protect yourself, and what you need to do if you are a victim.
Identity theft is a type of fraud where a thief will pretend to be you by taking your identity with the expressed purpose of access your resources and credit information. They can then use that information to buy things in your name, take out loans in your name and more.
The term identity theft dates back before the internet existed, all the way back to 1964, and some argue that it is more accurate to call it identity impersonation since you cannot take someone’s identity and leave them with no identity.
Identity theft has an immense impact on the world, more than most people realize.
According to the book Stealing Your Life¸ an astonishing 38 percent of victims in the United States do not tell anyone that they are the victims of identity theft. The reason for this is that there is an embarrassment to it and many do not want to admit they were victimized by an identity thief.
In addition, identity theft increased rapidly in the first decade of the 21st century. According to the Federal Trade Commission, in 2001 there were 750,000 identity theft victims, whose damages amounted to $5 billion. By 2004, there were 10 million victims and the cost was $54 billion. By 2007, the FTC was receiving more calls and complaints about identity theft than any other issue. On average, someone who is the victim of identity theft will spend 330 hours trying to get their credit right and fixed. That amounts to nearly a full two weeks in time to fix the problem. It is important to note that is just the average. Times to repair identity theft damage have been found to range from as little as three hours, to as much as 5,840 hours. If it takes you 5,840 hours to repair your credit, it amounts to 243 full days, most of a year. That is time away from work, time away from family, trying to deal with something that should not have been a problem.
That is just the time it takes to fix identity theft, but what about the financial cost. According to the Identity Theft Resource Centre, it costs an average of $881 to $1,378 to fix a problem that you did not create.
We would also like to think that most identity thieves are caught and sent to prison but a Gartner study found that there is only a one in 700 chance of an identity thief being caught. If an identity thief is caught, they risk 15 years in prison and huge fines. However, the cost to the government is very high. It will typically cost $250,000 to prosecute such a case, even on identity theft cases that only cost someone $100,000.
If you are going to save yourself the trouble of being a victim of an identity thief, then you need to know how identity thieves get your information. There are a wide variety of methods, some of which you may be surprised at.
· Thieves will actually dive into the garbage in order to get your identity. It is called dumpster diving and they will rummage through garbage bags to grab credit card bills. This is why it is so important that you shred all your bills and invoices.
· Thieves will get information from computers and other electronics that you store your personal information on. This can include mobile phones, USB memory sticks, PDAs, PCs and servers. Whenever you get rid of your old electronics, you must completely wipe the hard drives.
· Picking pockets is a proven technique for identity thieves. To protect yourself, do not carry identification you do not need, and keep your wallet or purse close to you. If you find they have been stolen, cancel all your cards immediately.
· One simple method thieves use is to just look over your shoulder while you enter in the information or sign a credit card receipt. Make sure you are aware of people around you and always cover your hand when entering information on a keypad.
· Malware is also used to get your identity. It is installed on your computer without you knowing, and then the information is stolen and sent to another computer. Having a firewall and software to find malware will protect you. Also, do not download anything you are not sure about.
· False job offers are another way thieves will get your information. The thieves will accumulate resumes and applications that contain a variety of information including names, addresses, birthdays, email addresses and telephone numbers. In addition, some will even have banking information. Do not put any vital information on a resume without knowing exactly where you are applying. Sometimes it is best to drop off your resume in person so you know exactly where it is going. Never, ever put your personal information like banking details, on your resume as there is no reason for an employer to have it until you are hired.
· Some thieves will impersonate organizations in order to get your information in what is called phishing. Never send your personal information over email or a website unless you went to the website without being prompted, and you have contacted your financial institution about an e-mail you received so you can verify it.
· People use very simple passwords like pass1234 and password1. Thieves will try these passwords to get into your account so only use complicated passwords.
· Thieves will steal your banking information off of checks, and they will even divert your mail to another location so they can get your bills. If you find that you are not getting your mail, contact your bill issuer and find out why.
· Some thieves will get personal information off of social networking profiles. Many people put up their maiden name, birthday, pictures and more. Make sure you check your privacy settings so that you are not giving away too much information out for thieves to use.
If you find you are a victim of identity theft, you should do the following to minimize the damage.
· Contact your local law enforcement agency immediately and report the crime to them. It is very important you do this because you can use the statement and information you get from the police department to help fix the problems caused by identity theft.
· If your bank has been defrauded by the identity thief, then you should contact the bank immediately and report your debit card, checks and credit card as stolen. This will help minimize the damage; you should also look at having your bank account number changed.
· It is important to know that, in the USA and Canada, you are not responsible for more than $50 of what someone spends on your credit card without you authorizing it if you notify your card company immediately. This is why you should report the credit card stolen immediately as it will make it easier for the credit card company to believe you, and that keeps you only paying $50. In Canada, credit card companies may provide zero-liability protection which goes beyond maximum liability ($50) protection. Check with your credit card company.
· Put a fraud alert on your credit report. This will freeze any inquiries on your credit and alert your credit agency that someone is trying to get credit on your account. They will contact you to see if it is you and if it is, they will allow the inquiry to go through. If not, they will block the inquiry and notify the person trying to check the credit about identity theft. A fraud alert stays on your credit report for 90 days. If you want, you can get an extended fraud alert that stays on your credit report for seven years. It does not damage your credit and it keeps the damage minimal on your credit. Contact Equifax (www.equifax.ca), Experian (www.experian.com), or TransUnion (www.transunion.ca) to put a fraud alert on your account.
· Lastly, get a copy of your credit report and keep an eye on your credit report every few months to make sure there are no errors on it. If something shows up, have it fixed immediately so your credit does not suffer.
More Resources:
If you ever believe you have been a victim of identity theft, here is what you can do:
– Call your local RCMP detachment or your Police Department
– Report your situation online through Reporting Economic Crime Online
– Visit PhoneBusters, send an email to info@phonebusters.com, or call 1-888-495-8501
Remember, common sense and vigilance are your best defence.
