More than 17 million
Americans were victims of identity theft last year, according to the Department
of Justice, and reports of breaches have become so common that most of us just
tune out the news. But that would be a mistake, because even if your bank
issues you a new credit card, the Pandora’s box that a breach can open could
impact you for years to come.
Hackers will sell your
personal information on the dark web and the smartest thieves will then put
together bits of information about your life to devise a profile they can use
to unlock security questions and get access to all kinds personal information
from your Facebook (FB) page “likes” to your private bank accounts.
The sad truth is that
it is up to consumers to protect their financial identity and set up road
blocks for thieves. One of the most effective ways to do that, and a must
first-step for people who have actually had their information compromised, is a
credit freeze, meaning a freeze on your credit information with the three data
companies, Equifax (EFX), Experian and Transunion (TRU). A freeze shuts off
access to your credit history and unlike a fraud alert, slams the door on new
account fraud. You’ll pay for the privilege, $2 to $12 per freeze per bureau
unless you have been a victim of identity theft, in which case it’s free.
Another important step
is to monitor your online banking and credit card accounts. It used to be
enough to scan the monthly statement, but these days a once a week check on
your online statements is a good preventative, plus you’ll be more focused on
nuisance charges that you might have missed. Most banks will allow you to set
up free fraud alerts. Unauthorized wire transfers and international charges on
your credit cards are the big red flags here. Changing your passwords on
websites you log into regularly is a good idea, but so is changing the
passwords and even email addresses associated with those accounts.
Buy a shredder – and
use it. A lot of identity theft is still old school, consisting of dumpster
diving in garbage and stealing mail. Shredding your bank and brokerage
statements are a first step, but even bills can provide critical info that can
help a thief.
Finally, it would be
great if all new technology, like chips on credit cards, could guarantee the
end of identity theft, but that’s not likely. Identity thieves are just too
savvy and resourceful. Your best defense is taking precautions on your own to
prevent theft and becoming your own security guard for your financial life.
By Gerri Willis
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