The rate of identity theft has increased over the past few years, especially in the United States. There are a lot of totally free ways to protect your family without paying for credit monitoring products.
The reasons for the increase range from the use of online banking tools and social media to the easy availability of credit and debit cards, increased use of online shopping carts, and the introduction of mobile payment options.
These new ways to access information have also made it possible for criminals to obtain more sensitive information about individuals such as Social Security numbers, credit card numbers, or bank account information.
The best way to deal with identity theft is to prevent it in the first place. That’s not always possible, but there are definitely a few things you can do to protect yourself and minimize the chances of anyone stealing your personal info. Or your money.
This article will cover both online and offline scenarios, since most of us conduct transactions in both arenas.
Protecting against identity theft
There are a number of ways identity thieves get your personal information so they can then make transactions in your name, or even open credit cards, bank accounts, etc., in your name. Below are some of the methods they use, followed with preventative solutions.
Remember: if you decide to adopt any of these solutions, train the whole family on it. Your kids may not deal with your mail, but they are definitely online.
Identity thieves go through people’s trash and find bills and other documents with identifying information.
Solution: shred any paperwork that has your name, address, credit card or social security number or anything revealing your identity on it. Don’t think that because a letter from your credit card company only has the last four digits of your account, this is safe to toss.
You don’t want these people connecting any part of your numbers with your name and address. Buy a shredder that shreds stuff up very small and also shreds credit cards. We recommend this Sentinel shredder.
Going paperless will save you a lot of shredding. Choose to get your statements and bills electronically whenever possible.
Documents you absolutely must shred include:
- Credit card statements. If they get hold of these and your credit card number, they not only have what they need to make transactions, but they can mimic your spending habits and stay under the radar longer. The longer it takes you to realize fraud has occurred, the harder it may be to sort it out.
- Address stickers from packages. Cut address labels off of packages you receive and run them through the shredder. A much quicker solution is to use a powerful marker like the Sharpie Magnum to blot out any identifying information. Note that sometimes you can still pick up a label and read through the marker in just the right light, but we consider it a minimal risk.
- Social Security statements. Pretty much anything you get from your government is going to need shredding, unless it’s a form letter with absolutely nothing but your address on it for identification.
- Junk mail with your name and address. Shred every piece of junk mail with your name and address on it. And check out how you can stop junk mail.
It’s easier than you might think to make it look like you’re sending an email from a company you have nothing to do with. Thieves do this, with instructions for you to do something urgent about your account.
Usually, the email tells you to click a link and log in. But if you follow their instructions, you’re not logging into the legitimate company website. You’re logging into what looks like it, but is actually a site where the thief can read your password. Now your account is accessible to him.
Solution: never to click a link from an email, even if you’re sure it’s legit. You can always just open the account up in your browser like usual to see if there are actually any alerts on your account like what the email was describing.
If it turns out to be a phishing email, forward it to your creditor. They will have a process for reporting them to the authorities. You can also report it to the Federal Trade Commission if you want.
If you use laptop or desk PCs at home or at work, you need to be sure they’re secure before you use them for banking or anything financial or personally identifying.
Some malware, called keyloggers, can send an identity thief a record of your every keystroke. This means passwords you’re typing in, logins, etc. If you get a virus, you may not know about it for some time, and during that time, the thief could get a lot of info.
Solutions: there are a few ways to tackle this one.
- Avoid viruses, as best you can. Make sure you’re running whatever firewalls or anti-virus software are recommended for your computer. Take a few minutes a couple of times a year to read the latest about avoiding viruses (such as how to recognize suspicious email links, strange behavior from your computer and potentially infectious websites). And avoid sites with any kind of illegal content.
- Use LastPass or a similar login storing solution. LastPass‘s free account stores all your passwords with encryption, behind a secure (https) connection, except for a master password that only you know (they can’t retrieve it for you if you lose it). All you need is one strong password, which means you can use super-strong passwords for all your accounts, and you won’t be typing in your various passwords everywhere you go online anymore, so keyloggers get nothing. But what about the master password?
- Use strong passwords, and don’t the same ones everywhere. If you don’t want to use a password memorizer, at least use a password generator online to generate strong passwords for sites you visit.
- A secure VPN can also help minimize your exposure to identity theft. Often one plan gives you coverage for an entire family’s worth of devices: cell phones, tablets and PCs.
It’s so easy to give away more than you realize about your identity on your social media accounts. Being aware of this – and teaching your kids to be aware of it – can help so much.
- Don’t take Facebook quizzes. As we learned from the Cambridge Analytica scam, these can be used by unscrupulous people to collect data not only about you, but about all your Facebook friends.
- Don’t let your town or date of birth show publicly. These can be used to steal your identity. You may also not want to share them with friends, since one of your friends falling for a quiz scam could deliver all your info to scammers.
- Don’t use your real name. Facebook requires it, but before Facebook, hardly anyone used a real name online if it was going to be displayed publicly. And it’s still not safe. Consider using a nickname, a variation of your legal name, or a “handle” on services that allow completely fictitious names.
Remember: free social media services don’t feel they owe you any particular level of security, since you’re not a paying customer. They also aren’t required to alert you or offer you ID theft coverage plans after a hack. They have no financial incentive to care about your safety, so it’s all up to you when dealing with them.
This is the toughest one to fight. While performing a real transaction for you, a waiter or store employee can swipe your card through a small portable device (they hook easily onto a belt) and it will capture all the card information.
Solution: don’t use your credit cards at stores or restaurants, or at least restaurants, where it’s normal for a waiter to take the card out of your site. Sorry, but that’s really the only way to fully prevent this.
Virtual credit cards can seriously reduce your risk. These are a very different type of credit card that creates a separate account number for every vendor you deal with. That limits exposure to just one vendor, so you know where the breach happened.
After-the-fact monitoring is also helpful when fraud happens. If you’ve had your data compromised in a breach, chances are you have free identity theft protection from a credit card already.
Diverting your mail
Yes, an identity thief who has your current name and address can easily fill out a change of address form so the post office will start forwarding your mail to the thief’s address instead of your own.
Solution: again, shred any documents with your name and address on them. Be careful who you submit your contact information to both online and off. If you fill out your contact info to win a car at the mall, make sure the contact card goes into the box where it belongs before you walk off. And check their terms to make sure they’re not going to sell your information.
Prevention isn’t always possible since names and addresses are usually easy to find through search engines. If you notice your mail seems light for a few days, that could be a bad sign. You can call the post office to see if they have a forwarding order on you or any member of your family.
Again, consider switching to electronic statements so that even when a thief successfully diverts your mail, he won’t get as much out of it.
Calls pretending to be from legitimate companies
Our favorite example around here: the Account Services scam. They may call, contact you by mail, or even cold call at your home. They typically are offering something that feels too good to be true, so watch for that feeling.
Solution: just don’t ever give financial or identifying information to anyone unless you solicited contact from them.
Monitor Your Accounts
Prevention is never 100%, so monitor your accounts to make sure there aren’t any strange transactions on them. To detect fraud quickly, you need to be on top of your finances and be on the alert for any changes you didn’t authorize.
An ID theft service plan can be helpful, but you still need to monitor for yourself. No identity theft protection service at any cost knows everything to look for in your particular situation.
- Check your credit cards and bank accounts online about every two weeks and glance over the transactions to make sure they’re all from places you buy from and the amounts sound right. Keep track of your subscriptions and memberships and how you pay for them, in case you start seeing, for example, what appears to be your normal Netflix subscription, only it’s on the wrong credit card.
- If you’re unsure of a charge on your card, call the creditor and ask them for more information on it. It might start to sound familiar once they tell you what they know, or you might confirm for example that the transaction occurred in a city you weren’t even in on the day it happened.
- Check your FICO score when you check your transactions. Many credit cards offer FICO scores for free and update them every couple of weeks.
In addition to making fraudulent transactions on the accounts you monitor, identity thieves may also open accounts in your name (bank accounts, credit cards, phones, electricity, even a driver’s license, etc.) with their address. They rack up bills they never pay, and all this goes on your credit, not theirs.
They’ve even been known to start collecting someone’s social security, get a job in someone else’s name, and even file tax returns in someone else’s name. If you get any of the following, start investigating immediately:
- Collection calls for debts that aren’t yours
- Unexpected rejection for a loan or new credit card or anything based on credit
- Contact regarding a home you never lived in, job you never had, etc.
If any of these things happen, you need to let your creditors know and file a report with the police.
Freeze Your Credit Card Accounts?
Some experts recommend proactively freezing your credit card accounts. This used to be a real pain because it meant no one you wanted to access your credit report (as in when you’re applying for credit) could do so.
Now you have easier options, like unfreezing it for a certain amount of time, giving the creditor long enough to get the report. Or you can unfreeze it within minutes by making a phone call and then freeze it again when the creditor is done.