Avoid an Identity Crisis

Here are several simple measures you can take to safeguard personal information and protect yourself against thieves.

Avoid an Identity Crisis

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“Protect your good name,” your grandmother probably told you one time or another.

She was probably talking about your reputation. These days, though, there’s a more literal meaning: Keep your name, and your bank accounts, from being stolen.

Some 9 million people a year may find personal information stolen through identity theft, according to the Federal Trade Commission. Not all such thefts lead to financial losses, but as the number shows, the risk is huge.

Just one example: In 2010, authorities in Providence, R.I., arrested a Russian man on suspicion of stealing the identity of an American who lived in Ireland. Federal prosecutors say the suspect had racked up a $260,000 mortgage and $14,000 in federal student loans. He also had a Social Security card in the name of the victim. According to The Associated Press, the suspect had been posing as the other man since as far back as 1993.


Tricks of the Trade

Identity thieves can come by your personal data in all kinds of ways. Some rummage through your garbage for discarded bills or credit card solicitations. Some get it by ordinary theft – stealing your purse or wallet and pulling information from your documents.

Then there are more sophisticated schemes. One is called phishing — using emails disguised as communication from a bank or credit card company to trick you into logging on to a phony website that then captures your account number and password.

Closely related is pretexting — calling you or companies you do business with and worming out your personal information by pretending to be someone such as a customer service representative of your bank, or maybe someone doing consumer research.

Then there’s skimming by retail clerks who surreptitiously enter your account information into their own memory-storage devices while processing your purchases. Some thieves may fill out an address-change form at the post office in your name, diverting your mail to them so they can steal information that arrives.

Identity thieves often use the information to commit credit card fraud, says the FTC. They might use it to open new telephone, cable, electricity or other accounts in your name, or to hijack your existing account. They can use your name to open a bank account and write bad checks on it, or take out a loan in your name. Worse yet, they can tap directly into your account and drain your funds.

Government documents aren’t immune: Identity thieves have been known to obtain driver’s licenses or other identifications in the name of others, or even to file phony tax returns using your information and get a fraudulent refund from the IRS.


Ounce of Prevention

Scary stuff, it’s true. But experts say a little common sense can go a long way to preventing identity theft. Here are some basic measures you can take:

Be careful in giving out personal data. Never give it out on the phone to someone who has called you; only give it to someone like a retail merchant or credit card company when you have initiated the call. And never give out personal information on a wireless phone call or using an unsecured wireless Internet connection.

Be wary of emails. Never trust an email that claims to be from your financial institution or other company you do business with and asks for information like your account number or password. Reputable businesses never solicit that information via email. In fact, avoid clicking on links directly from emails you haven’t solicited. Instead, enter Web addresses for the merchants you deal with yourself in your Internet browser.

Buy a shredder. Use it to destroy any financial records you no longer need to keep. Spend extra for one that doesn’t just slice up the documents vertically but cuts them into bits horizontally as well. And those credit-card solicitations that arrive in the mail? Shred them, too.

Protect your Social Security number. Don’t carry your Social Security card in your wallet, and make sure it’s in a secure place in your house or in a bank safe deposit box.

Keep your information secure at home. Don’t make personal data easy to find for strangers in your house — whether a handyman you’ve hired or your daughter’s new boyfriend.

Regularly check your bank and credit card accounts. Make sure you can account for every transaction you see there. Also, periodically review your credit report to make sure you know about all the transactions listed there. Some people discover they’ve been victimized when they see on their credit report a loan or credit card account they never signed up for.


Getting Notified

If you take those steps, you probably don’t need to sign up for expensive identity theft insurance, or even a fee-based credit monitoring service from your credit card provider. The Privacy Rights Clearinghouse notes that you can sign up free for a fraud alert on your credit reports with any of the three credit reporting companies, even if you are not an identity theft victim. You only need to call one. They are:

• Experian: 888/397-3742

• TransUnion: 800/680-7289

• Equifax: 800/525-6285

The alert requires creditors to take certain steps before opening new accounts in your name. It also entitles you to free copies of your credit reports. The fraud alert lasts for 90 days, after which you can sign up again. “Look for inquiries from companies you haven’t contacted, accounts you didn’t open, and debts on your accounts that you can’t explain,” the FTC says.


A Pound of Cure

But what if the unthinkable happens, and you do fall victim? Report the incident immediately to police. Doing so will make it easier to get merchants or creditors to reverse fraudulent charges. While you’re at it, report it to the FTC as well by calling 877/438-4338, going online to www.identitytheft.gov, or writing the Identity Theft Clearinghouse, Federal Trade Commission, Washington, D.C., 20580.

Also, report it immediately to every company with whom a fraudulent account was opened. Keep records of all your communications about the theft and make sure to verify that the disputed account or transaction is expunged from your record. And make sure to notify the credit bureaus about the matter.

If you follow the rules laid out here, the chances you’ll have to make those calls are small. And your good name can stay that way — and make your grandmother proud.


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