Identity theft involves illegally acquiring and using someone’s personal and financial details without their consent. Criminals might exploit an individual’s identity for various purposes, such as applying for credit cards or loans, withdrawing funds from bank accounts, using their credit card, submitting false tax or health insurance claims, or even selling the information to others.
To safeguard yourself against identity theft, the initial step is to understand how it happens. Once you’re aware, you can begin implementing measures to reduce your risk. While it’s impossible to eliminate the threat of identity theft, there are strategies to significantly lessen the chances of criminals accessing your personal and financial information.
Recognizing the Signs of Identity Theft
Identity theft can have numerous consequences, and it’s important to recognize its signs. Being aware of the indicators of potential or ongoing fraud can enable you to respond promptly and effectively to mitigate it. Key warning signs include:
- Missing Household Bills: If you suddenly stop receiving your regular bills in the mail, it might indicate that your personal information has been compromised and the thief has changed your billing address.
- Unexplained Loan or Credit Card Rejections: If you have a good credit history but are unexpectedly turned down for loans or credit cards, it could be a sign of identity theft. Additionally, being offered loans or credit cards at unusually high interest rates is another red flag.
- Invoices for Unrecognized Purchases: Receiving bills for items you did not purchase, or notices of overdue payments for accounts you do not recognize, are strong indicators that your identity may have been stolen.
- Strange Charges on Financial Accounts: Unfamiliar charges on your bank, credit card, or other financial accounts could mean these accounts have been accessed by an identity thief.
- Tax Return Rejection: If your tax return is rejected by the IRS due to a duplicate filing, it’s possible that a fraudulent return has been filed in your name.
- Small Test Charges on Credit Card Statements: Identity thieves often make minor purchases (typically under $5) to test if a stolen card is active. Seeing such small, unexplained charges can be a warning of larger fraudulent activities.
- Alerts from Creditors about Suspicious Activities: If you receive a notification from a creditor about unusual activities on your accounts, it’s crucial to address the immediate issue and take steps to prevent future incidents.
Ways to Protect Yourself from Identity Theft
To improve the security of your personal data and guard against identity thieves, adopting a proactive approach is important. The aim is to create multiple safeguards that can deter potential identity thieves and reduce the likelihood of becoming their target. Implementing strong preventive measures is key to making your personal information less accessible and more secure. The below seven steps can assist:
1. Password-Protect Your Devices
Failing to set a password on your smartphone or tablet is comparable to leaving your house with the door unlocked. If the device is obtained by someone with malicious intent, they would have easy access to your email, financial accounts, and other sensitive information stored on the phone, much like an unsecured house invites unwanted visitors.
2. Use a Password Manager
Utilizing the same password across all your electronic devices and key financial accounts poses a significant security threat. If a criminal manages to crack this single password, they could potentially gain access to all your other accounts.
One effective strategy to stop identity thieves is to vary your passwords, ensuring each account has a distinct one. Avoid using easily guessable elements like your name or birthday in your passwords and be sure to change them if you suspect any account has been compromised.
Remembering a unique password for each account can be challenging. To simplify this, consider using a password manager like LastPass or 1Password. These tools securely store your login details, relieving you of the burden of memorizing all your credentials.
3. Watch Out for Phishing Attempts
Avoid clicking on links in emails or text messages that appear suspicious. In a type of cyberattack known as phishing, identity thieves craft emails and websites that mimic those from legitimate sources such as your bank, credit card company, mortgage lender, or other financial institutions. Their aim is to deceive you into disclosing your account details or other confidential and sensitive information.
These deceptive emails might also prompt you to download an attachment, which can install damaging malware on your device. If you’re doubtful about the legitimacy of a link, it’s safer not to click on it. Additionally, avoid entering your username or password on login screens that seem unfamiliar. It’s also crucial to refrain from downloading email attachments unless you are certain of their contents and source.
4. Limit Your Exposure
To minimize risk in case your wallet is stolen, it’s wise to carry only a few credit cards. This reduces the potential impact of theft. Also, it’s crucial not to carry your Social Security card with you. The theft of a Social Security number gives identity thieves access to more financial accounts, making it a top priority to protect.
5. Check Your Credit Reports Regularly
Regularly reviewing your credit report is an effective method to detect discrepancies. This report contains details of the financial accounts under your name, including their most recent balances. Spotting something unusual early, like an unrecognized account, allows you to swiftly act, preventing the situation from escalating.
You can obtain a free credit report from each of the credit bureaus annually by visiting AnnualCreditReport.com. Additionally, Experian offers the option to access your credit report and view your credit scores at no cost.
6. Don’t Provide Personal Information Over the Phone
Be cautious of individuals who call posing as employees of a bank or credit card company, as this is a common tactic used by fraudsters. It’s important to remember that legitimate organizations will never call you to ask for sensitive personal information, such as your bank or credit card PIN, or your Social Security number.
If you receive a call that you think might be legitimate, ask for the caller’s details, then hang up and contact the organization directly using a verified phone number, such as one found on your bank statements. Additionally, be aware that the IRS usually does not make initial contact by phone; they typically communicate with taxpayers through postal mail for requests and information.
7. Keep Personal Documents Protected
Physical documents need careful handling to avoid security risks, as they often contain sensitive information like Social Security numbers and bank account details, which are valuable to identity thieves.
To protect against identity theft, don’t leave mail in your mailbox for long periods, as thieves often target them. If traveling, have a neighbor collect your mail or request a mail hold. Consider switching to electronic statements for financial accounts to reduce sensitive mail.
Identity thieves often search through trash for personal information. Therefore, it’s advisable to destroy any private records and statements containing personal or financial data before disposal, using a shredder. Additionally, avoid leaving behind a paper trail of ATM, credit card, or retail receipts, as these can be used by thieves to gather personal data. Instead, keep receipts until you can securely dispose of them at home, either by throwing them away or shredding them.
What Can I Do If I’m a Victim?
If you suspect identity theft, it’s crucial to act quickly. The longer identity thieves operate unchecked, the more they may escalate their activities, making recovery harder. Here’s what to do:
- Review Your Credit Report: Check for accuracy and identify any unrecognized accounts. Address any discrepancies immediately.
- File an Identity Theft Report: If confirmed, report the theft to the Federal Trade Commission and consider filing a police report. Inform your creditors about the situation.
- Place a Fraud Alert or Security Freeze: A fraud alert notifies potential creditors of possible fraud, asking them to verify your identity. A security freeze prevents access to your credit report, blocking the opening of new accounts in your name.
- Dispute Inaccurate Information: If you find fraudulent information on your credit reports, dispute it with the credit bureau. They usually resolve disputes within 30 days, removing any verified fraudulent information.
Identity theft can occur unexpectedly, emphasizing the importance of not being complacent about your personal data security. By proactively safeguarding your information and identity, you become a less attractive target for thieves, potentially thwarting their attempts.
Continuously monitoring your credit, securing your devices and accounts, staying vigilant against phishing and other scams, and ensuring your documents are secure are key steps in this process. These actions contribute to peace of mind, knowing your personal information is better protected.