Identity Theft: How to Detect, Deter and Fix

Identity theft is commonplace in today’s world and affects consumers and companies of all sizes. How can you best protect yourself and your data so that you can minimize the risk of identity theft?

Knowledge is power so it is crucial to gain critical insights and practical working knowledge into the various identity theft schemes, the most common mistakes made by individuals in failing to protect their identity, tips for protecting your identity, and guidance for fixing problems. Identity thieves can take your money, destroy your credit, and ruin your reputation. Stay a step ahead of this ever-changing crime by taking effective preventative measures, and learn how to put your life back in order if you do fall victim.

If you have had the unfortunate fate of being targeted by identity theft, the estimated time spent on re-establishing your credit and good name are around 600 hours of work, according to a study done by the Identity Theft Resource Center, a nonprofit organization. Victims spend on average $1,200 in out-of-pocket expenses in efforts to resolve the many problems caused by identity theft. Almost 50 percent of victims were not aware their identity was stolen, nor how it happened. Surprisingly, the victim knows the thief in more than 25 percent of all cases and, of those cases, the thief is a family member or relative in 35 percent of those cases.

Identity theft has two basic forms:

  1. Financial Identity Theft: Includes credit card fraud, mail fraud and passing bad checks
  2. Criminal Identity Theft: Involves using financial identity theft to support criminal activities

The Federal Trade Commission recently released the following statistics:

  • In the last twelve months, 9.93 million people have been victims of some form of identity theft crime which has cost financial institutions $33 billion and consumers $5 billion.
  • Identity theft is the fastest growing crime in the U.S. today as it is up 42 percent from the prior year.
  • Every 79 seconds, a thief steals someone’s identity, opens accounts in the victim’s name, and goes on a buying spree.

These are sobering numbers and everyone needs to be vigilant to prevent this stratospheric growth.

There are many sources that a thief can obtain your personal data:

  • Your wallet
  • Driver’s license
  • Credit cards
  • Gas cards
  • Department store cards
  • ATM cards
  • Medical benefits card (in which SSN is frequently the identifier)
  • Personal checkbooks
  • Social Security cards

Thieves will go through your garbage and mail looking for any personal identifiable information looking for cancelled checks, bank statements, credit card receipts, utility bill statements and pre-approved credit card offers. The term “phishing” refers to attempts to fraudulently acquire sensitive information such as passwords and credit card details by masquerading as a business or individual via email. Phishing scams work by sending what appears to be a legitimate email asking the recipient to follow the embedded link and verify their account details. The link provided in the email links to an illegitimate web site. If the user fills in the requested information, their bank account will be illegally accessed and emptied.

So how can you minimize being a target of identity theft online?

  1. Encryption: Uses digital keys to lock and unlock data while it is being transmitted over the Internet, which makes it incredibly difficult for anyone but the intended recipient to see or tamper with that data. For added safety, SSL (Secure Sockets Layer) makes sure the sites use 128-bit SSL to keep your data secure.
  2. Authentication Method: Utilized to identify the user when programs are attempting to access your personal information (i.e., web sites for bank accounts, online bill paying services, etc.). When you authenticate yourself to a PC or a secure web site, you enter a user name and a password or PIN to log in.

Further protect yourself from identity theft with these following steps: 

  1. Use computer software that protects your information and includes antivirus, firewalls, file encryption and password protection
  2. Store sensitive files on a flash drive or CD and lock them in a fire-rated safe
  3. Store a copy of that flash drive or CD in a bank safety-deposit box
  4. Do not store your personal information on a website
  5. Be wary of keeping personal information stored on your laptop hard drive
  6. Know the websites and companies from which you purchase merchandise, and be sure they use SSL, or some form of encryption to transmit personal data
  7. Read the website’s privacy policy before you give them any personal information
  8. Shred sensitive documents
  9. Black out personal information and tear up the documents
  10. Cut up the expired or cancelled credit cards and drivers licenses

For more detailed information on identity theft, check out Becker’s On Demand course entitled “Identity Theft:  How to Detect, Deter and Fix.

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Adina Hannan on sablinkedin
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Senior CPE Product Manager at Becker