In November 2007, the Federal Trade Commission released its 2006 report on the problem of identity theft in the United States. It is a problem that has special implications for credit card users. According to the report, an estimated 8.3 million Americans were victims of identity theft of one form or another within the preceding year. The most common type involved misuse of already existing accounts. Of these, 61% were credit card accounts.
Two findings of this study are particularly important if you are a victim of identity theft. First, and perhaps most obvious, the sooner the theft is found out, the less severe the losses, both in terms of time and money. In cases where detection occurred more than six months after the fact, 30% of victims reported out of pocket losses in excess of $1000. The number drops to 10% when detection occurred sooner.
In terms of time spent resolving problems as a result of theft, 32% of those in the more than six month group spent less than ten hours fixing problems. The number rises to 69% in the less than six month group. The second finding concerns how theft occurred. 84% of those surveyed responded that they did not know the thief. In fact, only 5% of victims of misuse of existing credit card accounts knew who committed the crime. Clearly, the foregoing facts point to constant vigilance as the key to avoiding identity theft and minimizing any damage if it does occur. What does this mean specifically as it applies to your credit cards?
While it is certainly necessary to exercise care in online credit card use, the attention devoted to high-tech occurrences of identity theft may sometimes obscure the fact that most abuse is the result of good old-fashioned hands on larceny. Thus, concentrating on a few simple things will greatly enhance your chances of avoiding enriching the lives of strangers at your expense. For example, sign the card as soon as you receive it. Of course, this does not mean much when, as in most cases, the merchant does not bother to check it, but it certainly does not hurt. In addition, though many transactions occur online and over the phone, there is still a massive amount of paper out there that will have vital credit card information on it. Make sure you keep all receipts, and shred those you do dispose of.
Speaking of paper, tear up the pre-approved card offers receive in the mail; otherwise, they can be stolen and sent back in with a change of address request. Good record keeping will also help keep the wolves from your door. Keep a list of all credit cards and their appropriate contact numbers handy in case of theft or loss. Also, be vigilant in checking monthly statements to make sure all purchases on a card are valid. Finally, though it may seem obvious, make sure you get your card back after making a purchase.
One of the findings of the 2006 FTC report on identity theft was that abuse of existing credit card accounts is one of the most common types of identity theft. Most of the time, it appears it is a crime of opportunity. As such, it is also often the easiest to prevent if a few simple precautions are taken.
Sometimes you get a shock when you open your credit card statement, and it's not just because of the phenomenal amount you spent on clothes last month. Occasionally there may be transactions on your credit card statement that don't look familiar. Sometimes this is a simple banking error, but it's worth paying attention, because you may be a victim of identity theft.
What Is Identity Theft?
Identity theft is the theft of personal information that can be used to identify individuals. It is closely related to identity fraud, which is the use of that information to obtain goods and services by deception. Identity fraud may also mean using that information to create a false identity.
Signs Of Identity Theft
Aside from the appearance of unrecognized transactions on your credit card or bank statements, other signs of identity theft are:
- Getting bills, invoices or receipts for goods or services you haven't ordered - Getting turned down for a credit card or loan in spite of having a good credit rating - Finding that a mobile phone contract has been set up in your name without your knowledge - Receiving letters from solicitors or debt collectors for debts that you know nothing about - Your post goes missing - Someone seems to be messing with your rubbish bags
How Does Identity Theft Happen?
There are many ways in which identity fraudsters can get hold of your personal information. In some cases, this may be through theft of your wallet or purse, burglary of your home, or pilfering from your letterbox. Identity fraudsters look for personal information such as your name, address, date of birth and so on. These can help them to set up new identities and even fraudulent businesses.
Other ways of stealing your identity include:
- Diverting your post through a change of address form - Hacking into your computer to get hold of private information - Monitoring ATM transactions or using special machines to get your PIN number
Fraudsters who get hold of your personal information will find it easy to open bank accounts, get credit card, loans, passports, driving licences and benefits in your name. They are unlikely to be strict about making payments on time, so it is your credit rating that will be affected.
How To Protect Against Identity Theft
There are many ways to make it more difficult for identity fraudsters to get hold of your personal information. First of all, get a copy of your personal credit file from time to time. This is inexpensive and you will be able to see if anyone has applied for credit in your name.
Let banks and credit card companies know when you move house and get your mail redirected. This will make it more difficult for someone to steal your letters and identity. At the same time, it's worth checking that no one is redirecting your mail without your consent.
Keep personal documents in a locked filing cabinet, safe or drawer or in a bank safety deposit box. Receipts should be shredded immediately if you don't want them. Throwing them away makes it easy for fraudsters to get credit card numbers. If personal documents (passports, driving licences, credit cards, debit cards and so on) are lost or stolen report the loss immediately.
Finally, keep your PIN and your passwords secure. The fewer people who know about them, the less likely they are to get into the wrong hands.
Both Michael D. Strauss & are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
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