How to keep your personal information and finances safe
By Steven B. Smith
For many consumers, the biggest threat this holiday season isn't overspending. It's something else that threatens their financial welfare, regardless of how much money they make, or whether they've saved up to cover their holiday expenses. Identity theft is one of the fastest growing crimes in America, costing $52.6 billion in 2004, and the hectic holiday season presents an opportunity too good for many thieves to pass up.
In most cases, so long as you report a lost or stolen card or account information in a timely manner, you are not liable for more than $50, and if you report it before any fraudulent charges have been made, you may not have to pay a single cent. But according to a study released earlier this year by the Better Business Bureau and Javelin Strategy Research, the average identity theft victim spent 28 hours resolving credit, financial and other problems caused by fraud last year. At this time of year, our schedules are busy enough without that extra headache.
By taking a few careful, yet simple steps, you can ensure a safe and enjoyable holiday season this year.
According to the Javelin study, the fastest method to detect fraud is through self-detection by electronic means. Victims of identity theft who detected the crime by monitoring accounts online experienced losses of about $551, compared with an average of $4,543 when detected from paper statements. The Javelin report states, electronic monitoring reflects near real-time activity, can be accessed from almost anywhere, provides greater safety by sharply reducing time to detection, and potentially eliminates the paper records and mail that are possible avenues to many identity theft cases."
An online budgeting program like Mvelopes Personal makes it simple to track all of your expenses from all of your accounts, including checking accounts and credit cards, all in one place. Review your transactions on a regular basis to make sure there are no unauthorized purchases or charges.
Make sure that the cashier returns your card after each purchase. Place your card in your wallet or purse where it can't easily fall out or be stolen. Also, be cautious of "shoulder surfers" – people watching over your shoulder to obtain your PIN or other account information – at the store, ATM, or when shopping online.
Beginning December 5, 2006, companies will not be allowed to print the expiration date or more than the last five digits of your debit or credit card number on receipts. Until then, many businesses still print entire account numbers along with card expiration dates on your receipts. This is the only information a thief needs to make thousands of dollars worth of unauthorized purchases with your card. Be careful not to lose any of your receipts, and shred them, along with any other documents containing this sensitive information, before discarding them.
While there has been considerable attention given to electronic method of obtaining personal information, the fact remains that the majority of the time, thieves obtain this information through more traditional means, such as a lost or stolen wallet, stolen mail, or misappropriation by family or friends. In cases where the method of obtaining personal information is known, most thieves obtain this information through offline means – about 68% of the time, compared to only 12 % online.
Consumers are getting more comfortable shopping online. According to a recent study by Forrester Research, US online retail sales this holiday season will hit $18 billion, a 25 percent increase over 2004. That's a lot of money changing hands over the Internet. Make sure that if part of that $18 billion is your money, it's going where you intended.
Don't give out account or other personal information unless you initiate the transaction. Thieves will sometimes send bogus emails, posing as a reputable business, warning that your account information needs to be updated. The email will link you to a site to enter in your information. Legitimate companies won't request this information via email. If you have questions about your account information, contact the organization by a phone number you know to be genuine, or type in their website yourself. Don't use the link given in an email.
When entering sensitive information on the web, be sure that the site is secure. Secure sites should have a padlock symbol in the lower, right-hand corner, and the URL address should begin with "https" instead of "http."
The Fair Credit Reporting Act (FCRA) requires each of the nationwide consumer reporting companies — Equifax, Experian, and TransUnion — to provide you with a free copy of your credit report, at your request, once every 12 months. Since your credit report can affect everything from interest rates on your mortgage to job offers, make sure you're taking advantage of this opportunity to ensure everything is accurate, especially after the busy holiday season.
Instances of fraud where a new account is opened to make unauthorized purchases is generally more costly than if an existing account is used, and in most cases cannot be discovered by monitoring existing accounts. Checking your credit report regularly is the best way to detect new, unauthorized accounts.
Some thieves will steal your information and then wait to use it, hoping you will let your guard down. Stagger the reports from the three different credit bureaus, receiving one every four months, to keep an accurate up-to-date watch on your credit throughout the year.
If you suspect any fraudulent activity, call the account provider immediately to close the account. Visit The FTC's Identity Theft website for more information on steps to take if you suspect you are the victim of identity theft.
With a little caution this holiday season, you can rest assured that your identity will remain yours, and yours alone. And you're going to need all the rest you can get after fighting those crowds at the mall.
Posted: December 21, 2008