Barbara O’Neill, Ph.D., CFP®
Extension Specialist in Financial Resource Management
Rutgers Cooperative Extension
A century ago, when criminals wanted to steal money, they robbed banks. While some bank robbers achieved fame and notoriety, robbing banks was a very hazardous “occupation.” Bonnie Parker, Clyde Barrow, and John Dillinger were all shot to death by police at relatively young ages as shown in the movies Bonnie and Clyde and Public Enemies. Willie Sutton lived to age 79 but spent more than half of his adult life in prison.
Today, identity theft is a leading cause of financial theft. There is no need for thieves to use physical violence to obtain money. Rather, a victim’s personal information and is used to commit a fraud that results in financial gain. Identity theft can affect credit card accounts, cell phone service, and bank and brokerage accounts (e.g., withdrawal of account funds). Some thieves even take out loans in a victim’s name, often for expensive items such as a car. Some identity theft is “low tech” (e.g., stealing wallets and “dumpster diving” for papers with sensitive data) while many other cases are committed online or by hacking computer data bases.
With identity theft, criminals act as if they were another person (the victim) and use the victim’s data to commit fraud in the victim’s name. Men can “be” women or women can “be” men as shown in a series of humorous television commercials about identity theft (e.g., a woman talking in a man’s voice and a man claiming to be a woman named “Peggy”). Identity thieves often capitalize on a topic or event in the news and use these events to create a sense of urgency to encourage victims to divulge personal data.
Unfortunately, many potential sources of identity theft are beyond an individual’s control such as personal data at workplaces, government agencies, medical service providers, and companies we do business with. While we can’t control every possible source of identity theft, it is important to control what we can. Following are suggested steps to reduce the risk of becoming a victim:
- Never click on unsolicited pop-up ads which are often associated with phishing scams or the launch of spyware on a computer. Use strong computer passwords that contain a combination of small letters, capital letters, and numbers in a string at least 10 characters long.
- Use a crosscut shredder to shred documents with sensitive data. A crosscut shredder is better than a straight line shredder because papers are cut into small pieces instead of strips that could be pieced back together.
- Avoid giving out your Social Security number. When absolutely necessary (e.g., to receive expense reimbursement), never type it in an e-mail. Instead, give it to the person in authority who is requesting it.
- Take precautions to secure incoming and outgoing mail. Use locked mail boxes or post office boxes for incoming mail and place outgoing mail in mail boxes and not in open mail trays.
- Avoid carrying around a lot of identifying information. For example, it is not necessary to carry around your passport unless you are traveling out of the country. It is also wise to make it a point to never provide personal data over the phone to people who call you and to not leave personal data out in the open at home.
- Write checks with a uni-ball pen that uses specially formulated inks that contain color pigments that cannot be washed away in a “check-washing” scheme. Uni-ball pens can be purchased at any office supply store.
- Regularly review credit reports (one of the three major credit bureaus every four months) to check for suspicious charges or other evidence of fraud (e.g., new credit accounts that you did not open).
- Consider a personal policy to never hand over credit cards to others to swipe outside of your view (e.g., waiters at restaurants). This reduces the risk of having data “skimmed” and misused by others. As an alternative, you can elect to hand others your credit card but closely monitor those accounts.