By Guest Blogger Craig Mirabella
This is an important issue that can not only affect your finances and your financial security, but can also creep into your public record and even your health records. That topic is identity theft, and it’s become one of the most serious and widespread crimes facing Americans today. In the last 12 months alone, nearly 10 million people have been victim to some form of identity theft. And to make matters worse, while the tried-and-true methods of old-school identity thieves remain a significant threat (such as stealing bank statements and other mail with sensitive information), a new breed of identity thieves are turning to more crafty, high-tech methods to steal, use and destroy your good name.
Did you know that internet identity theft rings are becoming a rapidly growing threat? That’s right. Identity thieves around the world often get access to customer records from companies with poor security systems and even crooked employees who are selling their company’s customer information on the black market. The thieves then gather in secret online chat rooms and trade identities for money.
I’m not kidding about this. I’ve been given a live demonstration of what happens in these chat rooms from a leading identity protection service provider. How does it work, you ask? Just imagine this: A chat room that looks like a scrolling billboard advertising messages such as “In possession of 50,000 [insert any bank name] customer accounts with social security numbers. Contact me to purchase.” or “Selling 20,000 [insert any bank name] credit card accounts for $50” or even “500 [insert state name] license numbers, names and addresses for sale”. There are thousands of these ads scrolling by on any of these chat rooms. When a thief is interested in making a purchase, he or she just clicks on the ad and enters into a secondary private chat room with only the seller so they can negotiate the transaction.
This is real, folks. It’s happening right now, and it could be happening to you without your knowledge.
You’ll only find out the hard way – when one of the thieves actually uses your information and puts you in a very tough position. Most victims don’t realize that their identities have been jeopardized until it’s too late.
And, what’s worse, identity thieves are not only looking to wreak havoc on your finances. They’re also after other personal information, like your license number – an identity thief can pose as you to a police officer during a routine traffic stop and use a perfect replica of a license in YOUR NAME with THEIR PICTURE to rack up expensive tickets on your driving record. Obviously, it adds incidents to your record and it can even devastate your insurance premiums! I’ve even heard horror stories of honest people getting thrown in jail because of something an identity thief did.
To me, what’s worse is that identity thieves are also stealing your medical insurance i.d. numbers and have now found ways to pose as you in order to get expensive medical procedures and drug prescriptions. Not only does this expose you to insurance-related fees and charges, but it also adds erroneous information to your medical history thereby jeopardizing the quality of your future healthcare!
So, I’m sure by now, I’ve managed to scare a few of you and you’re thinking “well if there’s no way I can prevent my identity from being stolen, what can I do to at least reduce my risk of identity theft?”
I’m glad you asked. I’ve been doing quite a bit of research on this over the past few months as my company is preparing to launch a top-of-the-line identity protection product. I’ve learned that there are several steps that you can take which will dramatically reduce the risk of becoming a victim. Follow these steps to protect your name and you’ll be in much better shape than those who don’t:
- Purchase a quality electric “cross cut” paper shredder and shred all mail that contains personal information, especially unwanted credit card offers and balance transfer checks.
- Do not respond to emails or phone calls from institutions claiming to have a problem with your account and requesting your account information. This is called “phishing” (pronounced “fishing”) and is a highly effective practice used by identity thieves (my poor mom even fell for it when she opened an email that looked like it came from her bank requesting that she “validate” her log-in and password information.))
- Keep your IDs on your person at all times. Consider switching from a traditional wallet to a “neck wallet” (a wallet with a lanyard that’s worn around the neck) to reduce the risk of losing your wallet. This is especially important for RVers who are on the road quite a bit!
- Password protect all of your bank accounts and other online accounts. Avoid using obvious passwords such as your birthday, anniversary or the names of your loved ones. Alphanumeric passwords (a combination of both letters and numbers) are the best. As a general rule, the longer the password, the more secure your information.
In addition to these, one of the most important steps you can take is to enroll in one of the several identity theft protection and alerting services. These services are typically offered by banks or associations, but can also be purchased from private companies. The cost can run anywhere between less than $100 per year to several hundred dollars, depending on your service levels, association discounts and other factors. Here’s what you need to look for to get top-notch protection:
- 24/7 credit monitoring, and credit alerts
- 24/7 Iinternet monitoring of known illegal chat rooms for your personal information
- Lost wallet protection which allows you to cancel all of your credit card accounts with a single phone call.
- Access to a number of important reports, including credit reports and credit scores, as well as your motor vehicle records and your medical information bureau records.
- Fraud resolution assistance. In the event you find that your identity has ever been compromised or stolen, you’ll need a strong fraud resolution specialist to guide you through the resolution process.
- At least $10,000 in identity theft insurance to help defray certain costs involved in restoring your identity..
You can also get fraud locks placed on your information – if anyone tries to open up an account in your name, then you’re alerted before the account is opened and you’re given the ability to accept the new account (for example, if it’s YOU trying to open it) or decline the new account (such as when a thief is trying to open it). I’ve seen some services include this benefit (like the guy that publishes his social security number everywhere), but I believe that most do not. You can always accomplish the same thing by freezing your credit with the three big credit bureaus. Keep in mind, this won’t protect you against account takeovers, such as when a thief uses your credit card to make purchases.
I hope this blog post opened your eyes to some of the more creative methods that thieves have of stealing and using your identity. At a minimum, I hope it at least prompted you to think about what the risks can be when someone gets hold of your identity. While you can never be too careful, you can take steps to protect yourself, like getting a good identity monitoring and resolution service. The cost of the protection is a small price to pay for what you get.