If someone uses your personal identifying information such as your name, address, Social Security number, and credit card numbers to steal money or create a false identity, you have been a victim of identity theft.
Scam artists are becoming better and better at stealing sensitive information from credit card machines, over the Web, and even by harassing victims to share certain pieces of information.
While identity theft cannot be avoided completely, there are some ways to prevent fraudsters and cyber thieves from taking advantage of you.
Here are some steps you can take to prevent identity theft:
1) Be careful when sharing your Social Security number.
Avoid carrying your Social Security number in your wallet because anyone that steals your wallet will have this sensitive information at their fingertips. Don’t ever enter your Social Security number directly into an online form unless it’s through an encrypted website and for a loan or other type of formal application.
Don’t be afraid to ask how the number will be used and what steps the individual or company is taking to protect your information. Also, in many business transactions you can simply decline to disclose your SSN – and people and organizations will still do business with you.
2) Shred statements before trashing them.
Make sure any statements, invoices, or other items that have your identifying information listed on them are shredded thoroughly before you throw them in the trash. Thieves can dig through trash to pick up materials that contain sensitive information. This practice is known as “dumpster diving.”
3) Protect yourself from online scams.
Be careful when providing personal information online through contact forms or even when placing an order using your credit card on small business websites. Information transmitted over the Internet can be intercepted and stolen by a scam artist. If you’re making an online purchase, verify that the URL or website has the prefix “https”. The “s” will confirm for you that it is a secure site. Also, to take it a step further you can use a private social network for extra security.
4) Choose complex passwords.
Don’t make it easy for someone to hack into your personal accounts just by guessing your password. Refrain from selecting passwords that include your first, middle or last name or your date of birth. Choose a different, complex password for each account and make sure you are changing your passwords regularly.
5) Verify sources that request personal information.
Whether you’re being asked to provide identifying information to a bank, an Internet service provider, or someone who claims to be from a government agency, make sure you are really dealing with someone from that business or organization – especially if they called you. Identity thieves often pose as officials, agents, or representatives of different companies in hopes that you will divulge some information.
Take steps to verify their identity – such as having them send you information in writing through the mail – so you aren’t sharing your information with a complete stranger who could be a crook.
6) Store information in a safe place.
Don’t leave important paperwork out in the open when you live with roommates or when you have maids or other service providers visiting your home. Keep your wallet or purse close to you when you are at the office, going out for the night, and when you are traveling. Read: Fed Warns About Identity Theft Targeting Kids
Believe it or not, a lot of identity theft happens on the job. And it’s not just because co-workers are dishonest. It’s mainly that in many offices or workplace settings a host of people come and go at all times – like delivery people, janitors, visitors and others.
7) Consider purchasing identity theft insurance or a credit monitoring service.
You can buy identity theft insurance to file a claim in the event that you do become a victim of identity theft.
This type of insurance can compensate you for lost wages and provide other types of coverage, such as reimbursement for money you may have to spend to clean up an identity thief’s mess.
Some policies also provide a personal counselor to help you resolve some the issues that arise from the identity theft. Read: Fact vs. Fiction About FICO Credit Scores
As for credit monitoring, it can provide you with an early warning signal about identity theft.
For instance, if someone tries to or does open a credit card account in your name, you would get an alert about an “inquiry” on your credit report. Depending on the service you use, that alert could reach you in seconds or as much as 36 hours later.
Either way, if you are notified about a transaction or application that you didn’t authorize, you may be able to quickly spot the wrongdoing and prevent further damage from taking place by letting the appropriate parties (such as credit bureaus, police and businesses) know that an identity thief is trying to misuse your information.