Identity theft occurs when a thief obtains, and illegally uses, your identifying information, such as your Social Security Number (SSN) or your credit card or checking account numbers, to open new credit accounts and apply for loans in your name.
If you are a victim, reclaiming your good name can take years and can be expensive. According to the Federal Trade Commission (FTC), the average consumer spends more that $1,000 to clean up the damage done by identity thieves opening new accounts.
Traditionally ID thieves have struck by redirecting mail, stealing sales receipts, and shoulder surfing-peeking over people’s shoulders while they are at the ATM. Technology expands their opportunities.
Spoofing,spamming, and phishing
Identity thieves aren’t only picking sales receipts and credit card offers out of trash cans to steal your information. They’re using highly technical methods. They spoof, spam, and phish.
Spoofers create a replica of an exiting Web page to fool a user into submitting personal, financial, or password data.
Make sure the Web sites you visit show a padlock near the bottom of your browser window. The padlock signifies the use of SSL (secure sockets layer) technology. By convention, URLs (uniform resource locators) that require a safe connection start with https: or s-http:.
Spammers send unsolicited e-mail, often of commercial nature, indiscriminately to multiple mailing lists, individuals or newsgroups. These e-mails include advertisements, viruses and hoaxes.
Report spam by sending an e-mail to the FTC at uce@ftc.gov.
Phishers use spam to lure people into fake Web sites to obtain personal information to commit identity theft. These criminals create and use e-mails and Web sites designed to look like e-mails and Web sites of well-known legitimate businesses, financial institutions, and government agencies to deceive users into disclosing financial institution and account information or other personal data such as usernames and passwords.
Preventing identity theft
Here are some ways you can prevent identity theft:
- Before revealing personal financial information, find out whom you’re dealing with, how the information will be used, and if it will be shared with others.
- Only give your SSN when it’s absolutely necessary (see list, next page). Ask if you can use another identifier, such as a driver’s license, instead. And don’t carry your Social Security card in your wallet unless you need it that day.
- Keep items with personal information in a safe place and either shred them or tear them up when you don’t need them anymore. Dispose of checking/share draft copies and statements, receipts with a credit car imprint, insurance forms, expired credit cards, saving and investment account statements, and credit card offers the same way.
- Order a copy of your credit report from each credit-reporting agency every year; there may be a fee. The Fair and Accurate Credit Transactions Act (FACT Act) of 2003, effective by the end of 2004, requires credit bureaus to provide a free report annually to consumers who request a copy.
- Verify that your credit report is accurate and that it includes only activities you have authorized.
- Look over your credit card and credit union statements each month for unauthorized charges or suspicious activity.
- Photocopy financial cards and insurance cards you carry in your wallet (front and back) and keep copies in a safe place; if your wallet is lost or stolen, you can promptly and accurately report the loss.
- Consider the information you are supplying on entries to win a car, shopping spree, and so on. To win, information such as your age or income range usually is not necessary.
- Contact the U.S. Postal Service if you don’t receive mail for a few days. You want to confirm that your mail, especially mail from all those credit card companies for credit card offers, hasn’t been diverted by a thief filling out a change of address form in your name.
Recovering from Identity Theft
The FACT Act helps ensure that all citizens are treated fairly when they apply for credit. It provides consumers with new national identity theft protections as well.
Before, identity theft victims had to call all their credit card issuers and the three major credit bureaus to alert them to crime. With the FACT Act enactment, credit bureaus will share identity theft complaints, and consumers will only need to make one call to receive advice, set off a nationwide fraud alert, and protect their credit standing.
The Act also provides for free annual credit reports (one per person per year) so consumers can review the reports for unauthorized activity. In addition, active duty military personnel can place special alerts on their files when they are deployed overseas.
If you are a victim of identity theft you need to do the following:
- Contact all creditors about fraudulent accounts and follow up each conversation with a letter. This includes credit card companies, financial institutions, brokerage companies, and utility companies. Close suspicious accounts and open new ones using new passwords, and PINs (personal identification numbers). Don’t use easily recognizable identifiers such as the last four digits of your SSN, your birth date, house number, and so on for passwords and PINs.
- File a report with your local police or the police where the theft took place. Get a copy of the report in case a creditor needs proof of the crime.
- File a complaint with the FTC at the Identity Theft Hotline, toll-free at 1-877-IDTHEFT (438-4338).
- Ask your creditors if they will accept the FTC’s ID Theft Affidavit. You can get one by calling the FTC at 1-877-IDTHEFT or at www.consumer.gov/idtheft. The affidavit allows consumers to report identity theft information to several companies simultaneously.
- If it appears that someone is using your SSN, contact the Social Security Administration to verify the accuracy of your reported earnings and your name. Call 1-800-772-1213 to check your Social Security statement.
Social Security Number Advice
You are required to provide your Social Security Number for:
- Income tax records
- Medical records
- Credit bureau reports
- College records
- Loan applications
- Vehicle registrations
You can and may want to refuse to provide your Social Security Number in these situations:
- As driver’s license number (in most states)
- On personal checks
- Over the phone
- On club memberships
- On address labels
- As identification for store purchases/refunds
- As general identification
Other Useful Resources
FTC identity theft Web site
www.consumer.gov/idtheft
Identity Theft Resource Center
www.idtheftcenter.org
For more information visit the Federal Trade Commission's website at www.consumer.gov.
Here is a list of the three major credit bureaus and their contact information:
