Things you must know about identity theft

Identity theft occurs when someone assumes someone else’s identity by illegally using his or her confidential information, such as social-security, bank-account, or credit-card number. Identity thieves benefit financially by removing funds from their victims’ bank accounts, taking out mortgages or other loan obligations in their victims’ names, and obtaining credit cards in their victims’ names and using them to run up large debts. If identity thieves cover their tracks by having bills and other mail sent to addresses they control, the victim will not be aware of the theft until considerable damage has occurred. Usually, victims can eventually prove that they are not responsible for the debts or missing funds, but they may spend significant time and money restoring their credit ratings and reestablishing their financial reputations.

No one is immune from identity theft. One case involved a three-week-old infant, and the dead are frequent targets of identity-theft plots. Nor are the victims exclusively individuals. Entire companies have been victimized by identity thieves. Those who study the problem cite many factors for the rapid rise of the crime: the growth of the Internet; the emergence of digital finance; the commonplace nature of consumer credit and the weak regulations governing the credit industry; and inadequate communication between local, national, and international law-enforcement agencies.

The jargon listed below, used by both criminals and law-enforcement authorities, helps explain how identity thieves go about their business.

Dumpster diving

Searching garbage cans, trash bins, and city dumps to find scraps of confidential information such as canceled checks, credit-card statements, bank documents, tax returns, discarded applications for preapproved credit cards, or any records that contain social-security numbers, names, addresses, telephone numbers, and other data that can be used to assume an identity.

Phishing (pronounced “fishing”)

Pretending to be a legitimate company and sending e-mails requesting the recipient to respond or to submit information on a Web page. Phishers make their e-mails and Web sites look authentic by including familiar logos and Internet links that appear to be the legitimate ones of the company they are using as bait. Literally millions of phishing e-mails are sent out each month, and many unsuspecting recipients respond, resulting in huge monetary losses.

Spoofing

Making an e-mail message look as if someone else has sent it. E-mail spoofers often claim to be computer-system administrators requesting the unsuspecting victims to change their user ID (identification) and password to a specific value, or pretending to be an organization’s management requesting a copy of password files or other sensitive information.

Hacking

Breaking into computer systems by using known computer-program flaws or by finding poorly controlled systems. Hackers attack computers all over the world; in 1998 a Russian hacker broke into Citibank’s computer in the United States and stole $12 million dollars from customer accounts.

Social engineering

Tricking employees of a company into disclosing confidential information. Common social-engineering tricks include pretending to be an employee who has forgotten a password, or to be from network security and needing a password to test the system, or assuming the role of a buyer or a salesperson to obtain the confidential information.

Key logging

Using hidden computer software to record computer activity, such as a user’s keystrokes, e-mails sent and received, and Web sites visited. Whereas parents may employ such software to check on their children’s computer usage and businesses use it to monitor employee activity, identity thieves utilize the software to garner confidential information and have it sent to them by e-mail.

Impersonation

Using someone else’s user ID and password to access a system. By doing so the thief is able to enjoy the same privileges as the person being impersonated.

Password cracking

Penetrating a computer-system’s defenses, stealing the password file, and using the passwords to access system programs, files, and data.

Packet sniffing

Using programs that capture data from information packets as they travel over the Internet or company networks. Captured data is sifted to find confidential information.

Eavesdropping

Listening to private communications or transmissions of data on unprotected communications lines. The most common way to intercept signals is by wiretapping.

Authorities suggest a number of ways to prevent identity theft and to minimize its consequences should it occur. Computer users are advised to be skeptical of all requests for information—legitimate companies do not typically ask for sensitive personal information via e-mail. Before entering personal or financial information on any site, users are told to check that it is a “secure” site by looking for the padlock symbol on the bottom of most Web browsers. Users are also advised to make sure that their passwords contain a combination of letters and numbers so that they cannot be easily guessed, and are not the same for every account. In addition, people should carefully check their monthly bank and credit-card statements for suspicious items and they should regularly review accounts online between statements. Confidential documents should be shredded to prevent dumpster diving. Firewalls and computer virus–protection software should be used to make a computer secure. Security patches released by vendors to correct software flaws should be installed as soon as they are available. Online retailers should be checked before making a purchase. Consumers should not give any retailers permission to store their confidential information, as the databases maintained by retailers may be vulnerable to theft.

Signs of Identity Theft

As you may know, identity theft is becoming more prevalent both in the online and offline world. This is because people aren’t as cautious as they should be, and thieves continue to find new ways of stealing personal information. For instance, a store may ask you to put your social security number on your check. This is not required of course, but it’s a way for someone to steal your identity. Some people however have no problems revealing critical information about themselves that could result in being the next victim of identity theft.

When you receive pre-approved credit cards in the mail, do you throw them away or use a shredder? If thrown away in tact, a thief could find it while dumpster diving and use it to steal your identity. With this type of information, thieves can use your name to create new accounts, apply for new credit cards, benefit financially, and then disappear before anyone can capture them.

Once you begin seeing signs of identity theft, chances are the thief has had plenty of time to run up debt and move around several times. Often, victims of identity theft don’t realize what’s happened until about 45 days or more after the theft occurred.

Requesting a 2 or 3 credit reports each year from the major credit report bureaus is encouraged to see if there are any signs of identity theft. If there is an account that isn’t yours listed on your report, then perhaps you will be able to limit the amount of damage done to your credit.

Signs of Identity Theft

The following are additional signs of identity theft to keep an eye out for:

If a creditor sends you a credit card statement and you don’t have an account with them, then this is a sign of identity theft. A phone call from a creditor you don’t belong with is a cause for concern as well. A thief may have used your name to open a new account without you knowing.

If you applied for a new credit card or loan and were denied, then find out why. This is especially the case if you have good credit and there was no good reason for you being denied. Check your credit as this could be a sign of identity theft.

Cash advance withdrawals on your credit card statement or unidentifiable charges are definite red flags. Contact the creditor immediately to find out where those charges came from.

Another sign of identity theft is not receiving a credit card statement when you normally should. If you didn’t get a statement, contact your creditor as it’s possible that a thief stole your identity and changed the mailing address.

Not protecting your information increases your risk of being an identity theft victim. Be cautious whenever giving out important personal details and monitor your credit periodically to lookout for signs of identity theft.

Steps To Prevent Identity Theft

Identity theft is a crime that seems to be getting worse throughout the world. In past years, one could argue that this crime has been taken too lightly by people, generally assuming that it couldn’t happen to them. However, as the rates of identity theft continue to grow, more people now want to know the steps to prevent identity theft. This shows that people are taking it more seriously now then ever before. Identity theft really makes victims feel like their privacy has been invaded, despite the fact that the never personally encounter the thieves. Such a crime can cause damage to victims emotionally. It almost is the equivalent of a criminal coming into a home and vandalizing it.

Prevention involves first knowing what it is and how it happens. Then, it comes down to taking the necessary steps to prevent identity theft.

What is Identity Theft?

Identity theft involves one person stealing another’s personal information to benefit in some way, usually financially. This information could include a credit card or bank account number. The thief could use it buy products and services online where they don’t need to have the credit card in possession. Social security numbers sometimes get stolen, and the thief could use it to gain employment or sell it to illegal immigrants for them to use. In the most severe cases, a thief will commit a crime using the stolen identity. This of course often leads to the innocent victim being arrested.

How Does Identity theft Occur?

An identity can be stolen in any number of ways, some are rather basic while others are more advanced. Credit card theft, phishing scams, stealing documents, and hacking into databases are just several methods used by thieves.

ID Theft Insurance: What To Expect

Identity theft prevention is being pursued by many who are looking to avoid or at the very least minimize the losses if victimized. One such way is to obtain credit card protection, but this won’t protect from all types of identity theft. The other option is ID theft insurance, which is designed specifically for those who want coverage in case they are victims of identity theft.

What is ID Theft Insurance?

The concept of ID theft insurance is no different than insurance for anything else, it’s to provide reimbursement for the incurred losses that result from identity theft. Because more and more identities are being stolen, obtaining ID theft insurance is being seriously considered now more than ever. Insurance companies that offer this may offer several different policies depending on what best suits you.

The policies available will vary in terms of the types of theft and the amount of money that will be covered. For instance, one policy may provide protection for credit cards, debit cards, ATM cards and up to $30,000 for the family. So it’s possible that you could still lose money if you are a victim despite having ID theft insurance.

Credit card companies sometimes offer ID theft insurance as well. You might find that the protection plans through your credit card company may be less than what insurance companies offer. Discover card offers a plan that will insure victims up to $25,000. Contact your creditor to see if they offer such a service if you aren’t sure.

Terms And Conditions

Learn the terms and conditions of any ID theft insurance policy that you are considering before making any decisions. As you research what companies offer, you will find that the terms will vary based on the policy. Some for instance may pay for cost for notarizing fraud affidavit, long distance telephone calls that deal with the fraud, and other fees associated with the recovery process. Others may not provide this much coverage. Compare and decide what is best for your situation.

Legal costs will generally be covered in most insurance policies when you hire an attorney. A portion of lost wages due to missing time from work may be provided over a short period of time. Fees that incurred from loan re-application because of inaccurate credit information could be included in the policy, as well as mailing costs.

Prevention is the best way to combat identity theft. If peace of mind is important to you, then ID theft insurance may be a good option for you. The key point is to know exactly what you are getting with a policy.

Child Identity Theft: Is Your Child At Risk?

While identity theft is an issue that is often talked about, what tends to be ignored is the increase in child identity theft. When everyone is born, they are assigned a social security number. Since children don’t generally use their social security number, they are more susceptible to identity theft. Also, their credit report or social security number isn’t typically monitored by families, which also increases the likelihood of being victims of identity theft. When thieves get access to this information, they are able to use a child’s name to get credit cards and obtain additional finances.

When the child identity theft victims reach the age where they begin monitoring their credit reports or apply for credit cards, they might be in for a surprise. They may not get approved for credit, and have no idea why. Once they find out, then they have to begin restoring their credit. This process could takes years, but isn’t necessary as long as the enough caution is taken. The following will discuss child identity theft more in depth and how you can prevent it from happening.

Child Identity Theft

A child’s social security number is used for several reasons. Parents will use to so to a greater tax return on their income, and children will use it to get health insurance. In addition, a SSN will be applied when registering for a doctor, attending a new school, or participating in certain activities. A SSN can get in the wrong hands and put a child at risk for identity theft.

As mentioned, not many parents even think about checking on their child’s credit report. And why would they? Their child has no credit history. So it doesn’t get looked at often times until he or she is ready for a credit card.

Monitoring for child identity theft is not easy. In order to get access to a child’s credit report, you will have to mail a letter requesting the information. Many parents may not even know about child identity theft, or even bother taking the time to get it.

The Process of Child Identity Theft

Once thieves have a SSN in their possession, they can use to find out more information about the victim. Using this information, they can open new bank accounts, apply for credit card, loans, and rack up all kinds of debt. Recovering from identity theft is very challenging, especially if it has been happening for years without anyone knowing.

Preventing Child Identity Theft

Therefore, taking steps to prevent child identity theft is important. You can monitor your child’s credit report by requesting one every 1-2 years. Never disclose any critical details about your child unless it’s absolutely required and the place or person requesting it can be trusted. For example, there is little to no risk giving it to your child’s doctor or to the IRS. Plus, there is no way around not giving it to them if they need it. Keep the SSN in a safe place in your home as opposed to carry it around with you.

Preventing child identity theft doesn’t require doing much, but in this case a little goes a long way.

Identity Theft Credit Repair

While the legal process for identity theft credit repair can be quite lengthy, recovering your identity is very much possible along with regaining a sense of normalcy in your life. The objective of credit repair is to completely remove all the fraudulent charges against you. This can be accomplished by combating the charges and proving to financial institutions and credit bureaus that you were a victim of identity theft. When successful, your financial standing and credit score will improve as a result of the the negatives being removed from your file.

Victims shouldn’t waste anytime contacting all creditors and informing them of the situation. This means telling them that any purchases in their name shouldn’t be authorized and their credit should be suspended. Call any financial institutions that you have accounts with, such as banks and credit card companies.

Identity theft victims have the right to contest any items on their credit report that are either inaccurate, misleading, or unverifiable. The credit bureau has 30 days to verify all of the details. If they can’t, then all the charges must be removed. They have to prove that you actually paid for all the items.

Victims will receive in writing all the results of the investigation and changes made to their credit reports. Information that has been removed from a report can never be returned unless evidence surfaces that verifies that the charge was not fraudulent. Upon request, a notice must be sent to anyone who has seen a report in the last six months to explain changes that have been made. Updated reports can be sent to any employers whom victims have been with in the last two years.

Identity Theft Prevention

A credit monitoring service or insurance should be considered by anyone who has been a victim. Sometimes a stolen identity can get passed around to other criminals, so you are still at risk. Many services are available that provide identity theft protection, such as Identity Guard and Lifelock. You can obtain a maximum of $1,000,000 insurance from Lifelock to cover damages that occur to your records as a result of being a victim.

A credit monitoring will also the bear the burden of recovering your identity, saving you a great deal of time and headaches. The best services, such as Identity Guard and Lifelock, will manage the situation and work to remove the blemishes from your credit.

Credit monitoring can be done on your own by requesting credit reports periodically. However, this will only give an update of your credit every so often and ultimately won’t recover your identity if it’s stolen. Doing all the monitoring yourself can require a lot of work and time. Meanwhile, credit monitoring services will not only watch over your credit around the clock, they will also take care of the restoration process as well.