Identity theft is one of the most prevalent crimes in cyberspace, and it has become increasingly difficult for people to protect themselves from thieves who want to get their information and steal their money.
“Identity fraud or theft occurs when thieves use your personal information to commit a crime, whether that means stealing your credit card details or using your Social Security number to create a fraudulent bank account,” says the New Jersey Society of CPAs (NJSCPA).
NJSCPA has makes several recommendations for protecting yourself from cyber-criminals:
Understand the Dangers. One of the best ways to prevent identity theft is understanding how it happens, says NJSCPA. It can involve devices that steal your credit card numbers when you make a purchase or a sophisticated hacking scheme.
There are also many low-tech methods. Thieves will sometimes comb through dumpsters, for example, to find bank or investment account statements or other confidential documents. The best way to prevent this is to purchase a paper shredder or tear up your statements before you throw them out.
Small business owners should also keep in mind that federal and state laws require that they destroy confidential employee information before it is thrown away.
Phishing: Don’t Take the Bait. Phishing has been around for a while, but scam artists continue to come up with new angles. Phishing involves a fake E-mail or other communication designed to look like it comes from your bank, another financial institution, or even a government agency.
The message urges you to click on a link to a site where you’ll be asked to reveal confidential financial information. NJSCPA recommends that if you get this kind of communication, call the organization that supposedly sent it to confirm that it’s legitimate. In most cases, you’ll likely find that it is not.
Keep Up with Your Credit Scores. Identity thieves don’t just steal your credit card number, they may also set up completely separate accounts in your name and then don’t pay the bill, says NJSCPA. One way to find out if this is happening is to monitor your credit report through one of the three major credit bureaus — Equifax, Expererian, or TransUnion.
If you discover accounts that you didn’t open, you may be able to prevent some of the consequences of identity theft, including the damage it can do to your credit rating.
Don’t Share Too Much on Social Media. Many people reveal their full birthdays and other personal details — such as pet or school names — on Facebook or other social media accounts. This is just the kind of information that financial institutions and other organizations use to verify your identity before allowing you access to your account.
“There’s a great danger that thieves will use those details to clear out your bank account, run up charges in your name, or open an account you know nothing about,” says NJSCPA. “Before you pump up your online profile, consider how an identity thief might use those details.”
Act Quickly. If you find out that your identity has been stolen, there are a number of steps you should take immediately. File a police report to establish a record of the theft and any consequences that you have discovered. Challenge any related transactions with the merchants or financial institutions involved and close any accounts to which thieves may have had access. Report the problem to the credit rating agencies and ask that your credit reports be corrected and that a fraud alert be placed on your records.
Also, let your creditors know about the problem in case any changes in your credit rating affect your borrowing options. Finally, look into filing a complaint with the Federal Trade Commission, which will provide you with an ID Theft Complaint Form.
Those who have been victimized by identity theft, or who want to take preventative measures, can turn to their local CPA for advice on protecting confidential details, or recovering from a theft. If you don’t have a CPA, you can locate one online using the NJSCPA’s free online Find-A-CPA service at findacpa.org.
“The most important thing to remember when online is to remain vigilant, because there’s no shortage of criminals out there looking to scam you out of your money,” says NJSCPA. “Nearly 12 million adults were victims of identity fraud last year, up 13 percent from the previous year.”