Identity theft: don't be a victim.
The 1990s spawned a new variety of crooks called identity thieves. Their stock in trade is your everyday transaction. Each transaction requires you to share personal information: your bank and credit card account numbers; your income; your Social Security number (SSN); or your name, address, and phone numbers. An identity thief co-opts some piece of your personal information and appropriates it without your knowledge to commit fraud or theft.
Identity theft is a serious crime. People whose identities have been stolen can spend months or years--and thousands of dollars--cleaning up the mess the thieves have made of their good name and credit record. In the meantime, victims may lose job opportunities, be refused loans for education, housing, or cars, or even be arrested for crimes they didn't commit.
As the problem continues to increase, it's important to learn how to protect yourself. You can minimize your risk by managing your personal information wisely and cautiously. This article, the first of two parts, will help you to protect your name and credit.
How identity theft occurs
Despite your best efforts to manage the flow of your personal information r to keep it to yourself, skilled identity thieves may use a variety of methods to gain access to your data, including, among other techniques:
* Stealing wallets and purses containing your identification and credit and bank cards.
* Stealing your mail, including your bank and credit card statements, preapproved credit offers, telephone calling cards, and tax information.
* Completing a "change of address form" to divert your mail to another location.
* Rummaging through your trash, or the trash of your business, for personal data in a practice known as "dumpster diving."
* Using personal information you share on the Internet.
How identity thieves use your personal information
Identity thieves may call your credit card issuer and, pretending to be you, ask to change the mailing address on your credit card account. The imposter then runs up charges on your account.
They may open a new credit card account, using your name, date of birth, and SSN. When they use the credit card and don't pay the bills, the delinquent account is reported on your credit report. Other schemes include establishing phone or wireless service in your name, opening a bank account in your name and writing bad checks on that account, and counter-felting checks or debit cards and then draining your bank account. They may even buy cars by taking out auto loans in your name.
What you can do
Order a copy of your credit report from each of the three major credit reporting agencies every year. Make sure it is accurate and includes only those activities you've authorized. The law allows credit bureaus to charge you up to $9.00 for a copy of your credit report.
Equifax -- www.equifax.com
To order your report, call: (800) 685-1111 or write: P.O. Box 740241, Atlanta, GA 30374-0241
Experian -- www.experian.com
To order your report, call: (888) EXPERIAN (397-3742) or write: P.O. Box 2104, Allen TX 75013
TransUnion -- wwwtransunion.com
To order your report, call: (800) 916-8800 or write: P.O. Box 1000, Chester, PA 19022.
By checking your report on a regular basis you can catch mistakes and fraud before they wreak havoc on your personal finances. Don't underestimate the importance of this step. One of the most common ways that consumers find out that they're victims of identity theft is when they try to make a major purchase, like a house or a car.
Place passwords on your credit card, bank, and phone accounts. Avoid using easily available information like your mother's maiden name, your birth date, the last four digits of your SSN or your phone number, or a series of consecutive numbers. When opening new accounts, you may find that many businesses still have a line on their applications for your mother's maiden name. Use a password instead.
Secure personal information in your home, especially if you have roommates, employ outside help, or are having service work done in your home.
Ask about information security procedures in your workplace. Find out who has access to your personal information and verify that records are kept in a secure location. Ask about the disposal procedures for those records as well.
More steps to take
Although you probably cannot prevent identity theft entirely, you can minimize your risk. By managing your personal information wisely, cautiously and with an awareness of the issue, you can help guard against identity theft. In next month's issue, look for more tips on protecting your identity.