Identity Theft – Do You Know What it Means to Your Financial Security?

Have you been a victim of identify theft? If you have you are not alone.  Millions of people have been.

Identity theft is a crime in which someone illegally obtains and uses another person’s personal information.  That information may include the other person’s name, date of birth, bank account information, social security number, or driver’s license number.  This information is usually used for financial gain by the individual who wrongfully obtained the other person’s personal data.  Identity theft results in identity fraud.

Identity theft is a serious problem. In 2008 identity theft increased 22% from 2007 and affected nearly 10 million people. Complaints of identity theft actually decreased from 2004 to 2006 in relationship overall to other fraud complaints.  But according to FBI statistics it is the fastest growing crime in the US and the Federal Trade Commission says it is the fastest growing type of complaint.

The US Department of Justice Identity Theft 2005 report gathered its information from the National Crime Victimization Survey. The report contains a complete year’s worth of data after additional questions were included in the survey in July 2004.  A sampling was taken of 40,000 individuals who were interviewed and these are some of the results:

1. About 1.6 million households experienced theft of their bank accounts excluding credit card accounts.

2. One point one million households were victim of abuse of personal information such as their name, address, social security number and other individual records.

3. Households earning $75,000 or more were subject to identity theft at a rate of 10% which is almost twice as much as households with incomes lower than $50,000.

4. The average total loss per household was $1,620.

5. The average cost to repair the damage done by identity theft is $500 but many people who have been victimized by identity theft end up paying nothing because of fraud protection programs that are offered by credit card companies and other financial institutions.

6. The most widely used way that identity theft is perpetrated is through wallets, purses, and paper documents that are stolen.  This amounts to 43% of all identity theft.  Information stolen from the Internet resulted in only 11% of the theft.

Now you know the facts and figures regarding identity theft.  Since you are fully aware, read my next article to find out ways to reduce your risk of becoming a victim of identity theft.

Ways to Reduce the Risk of Identity Theft

Don’t make yourself an easy target.  Even in your own home you should keep your financial information in a locked or secure location to prevent the possibility of a visitor taking some important personal information or credit cards.

Always know where your checkbook and credit cards are and make sure that they are not missing.  Also be aware of where your debit card is because if someone steals it they may be able to use it without your PIN or they may have learned your PIN by observing your transaction. Your bank account can be drained by a thief very quickly. It is best to use a credit card rather than a debit card at a restaurant if you are paying the bill through another person such as a waiter or waitress or at any other place where you can’t observe the actual transaction.

Be aware of your surrounding circumstances so that your purse or wallet is not stolen.  Carry only what is necessary on your person.  Limited the number of credit and debit cards you carry in your purse or wallet and keep photocopies of everything in your wallet or billfold so that if it is stolen you will know exactly which financial institutions you must call. Never carry your Social Security Number on you, always keep it in a safe and secure place.

Make it difficult for your information to be stolen.  Always use a paper shredder for any records that contain your financial information including bank account numbers and credit card numbers or other personal data including your name, address, and social security number.  Never throw away any of this data prior to shredding it.

Always use commonsense when it comes to protecting your mail.  Thefts sometimes wait until the mail is delivered and then steal mail from mailboxes that are easy targets.  The best advice is to use a post office box, a locking mailbox, or a door slot that is big enough so that all of your mail can easily be put inside so that there is nothing available to steal.  If you don’t have a locking mailbox or slot, make sure you check with the Postal Service before changing your box.  They must approve any changes prior to them being completed.

Do not leave outgoing mail unprotected and available for anyone walking by your home to take.  Either use a collection box or drop your mail inside the post office where it is safe.  Also watch when using a collection box make sure that your mail actually goes down the snorkel and is not sticking out where it can be taken by the next person using the collection box.

Keep a watchful eye on your credit report.  If you notice any irregularities follow up immediately because this could be the first sign of identity theft.

Be cautious about giving out personal information over the phone to telemarketers or through emails that appear to be from your financial institution.  Only give out sensitive information such as your social security number, etc. if you initiate the call.  Use the phone number provided on your statement or on the credit card itself, do not use phone number or email address provided by the caller or emailer.

If you become a victim of identity theft the results can be devastating and your credit rating and reputation are at stake. It can be extremely time consuming to notify all of your financial institutions and credit card companies of the loss.  Always take as much precaution as possible to prevent identity theft because it is more than worth the effort.

Tagged with: credit card accounts • households • Identity Theft fraud • Security

Filed under: Finances

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