Identity Theft

Why is it that credit bureaus can gather such a great amount of information about you and sell it? Don’t you have a say in how your information is handled or whether it should be handled by anyone at all? There are reasons why your name and social security number have a credit file, this really does make things easier when you apply for a mortgage or a car loan etc. In today’s economy there’s a significant need for credit and an organized system for reporting it. But your identity does not belong to you in the sense that the collected information is in fact the property of the credit bureau that gathered the information.

There are more than 1,000 local and regional credit bureaus around the country (US), the three major ones are Experian, Equifax and TransUnion. All of which collect and record information reported to them by your creditors, banks, credit card companies, private lending institutions etc.

Yes they sell your information to third parties and this is profitable for them, and those third parties may resell or share that information with other business partners who then pre-approve you for dozens of credit offers each year and add you to their mailing/distribution lists to send you stuff you don’t really need.

Why this puts your identity at risk?

The trading and exchanging of personal consumer information is risky business, for the consumer that is. Those who obtain your information from the credit bureaus could mishandle your information and expose you to a hacker. Unfortunately this is simply the cost of doing business.

Credit bureaus are private companies with a business that’s regulated because it involves a certain degree of risk for the information owner. Those regulations do not yet do enough to protect consumers however. Hey cigarettes and alcohol are dangerous also, but they’re not going to stop selling them are they? As long as they’re regulated and the producers pay federal taxes, all is well.

Do you have any say in this?

Luckily yes. You can request a credit freeze. Sometimes known as security freeze, prevents a credit reporting bureau from releasing your credit report and stop inquiries and subscriptions on your account without your consent. You can request a credit freeze from each of the credit bureaus, and typically you’ll be provided with a personal identification number and/or password if you ever want to remove it.

The most immediate advantage of placing a freeze on your credit report is to stop releasing your information to those who intend to market to you. But you must also know that by placing a credit freeze on your file you’ll stop your own self from being able to get credit, apply for a mortgage or a car loan. If you can live without those things and simply want to take control of your identity now, then a credit freeze will work great.

This mostly applies to the 3 major credit bureaus, other companies that gather information about you must be contacted individually and there could be hundreds of them. They can still trade your information and continue to send you junk mail and credit offers if they already have you on file. The freeze only stops the bureaus from further releasing information about you.

One way to address your information already being available is to either use credit monitoring or identity theft services. Although you can do much of what these services yourself, it will prove time consuming and burdensome to tackle this task on your own. Definitely something to consider.

Getting a hospital bill for $30,000 can be scary and upsetting, but medical identity theft involves a lot more than financial burdens created by someone who uses your personal information to get medical care. Medical fraud is one way that identities are abused by thieves, and the real danger is not the long term financial problems it can create, but the life threatening consequences it can have on an innocent patient.

Of the many faces identity fraud has, medical identity theft is the deadliest one. Your medical records could end up with the wrong medical history and diagnoses and these are the things that can cause serious problems for you when you do need medical care.

The majority of cases of medical fraud involve criminal rings that often work with corrupt medical staff, who even include doctors. They purposely file false claim’s with the insurance information of unsuspecting victims. Some of these rings are so well organized for this type of crime that they can even setup fake clinics. The medical billing system is complex and confusing for most people, but for medical staff that know how the system works, this is all too easy.

This type of identity fraud can be very lucrative, continuously setting up fake claims can produce millions of dollars a year and now that most medical records are electronically archived, this presents even more opportunity since now thieves can steal millions of records at once. After all the damage is done and the victim realizes that their records are wrong, they will have a very frustrating time correcting these entries, which in many cases remain on medical records permanently.

Dangers of a wrong diagnosis

If you’ve been a victim of medical identity theft, you’re immediately in danger, especially if you are not even aware that your medical records have been wrongfully altered. This could mean a life threatening diagnosis for you.

Imagine being given a medical prescription for medicine that you’re allergic to, or being denied treatment because your records show that you were already treated for a specific condition you’re now developing and the medical facility considers you a liability because of what’s on your record. What if you were told your recent xrays are keeping you from getting new xrays that you need in order to find out what’s wrong with you? What if you needed surgery and couldn’t get it because according to your medical records you’re currently recovering from a previous surgery?

These are only some of the instances in which medical identity theft can complicate and threaten your life. The consequences go on and on and even if your life is not threatened by the changes in your medical record, the financial problems you’ll face can certainly make you sick.

Medical insurance fraud costs millions of dollars every year, and if you become a liability to your medical insurance company you can also be dropped. Your medical benefits could be exhausted if someone else impersonates you and uses your information to make their claims. Insurance companies have policies for dealing with fraud and most will work with you to investigate the fraud, but if your benefits continue to be abused you could end up with no benefits.

Identity theft protection and medical fraud

Identity protection services became available as a way to combat the ongoing epidemic of identity theft crimes, which in the majority of cases still refers to credit fraud. But there are so many ways to take advantage of another person’s identity that these services make a lot of sense. Even though they have great security features to stop identity theft, their services still have not fully responded to the threat of medical identity theft. Not every identity theft protection service offers medical benefits protection and the few that do, offer only limited protection measures to prevent this threat.

For now the only company we have discovered that offers medical benefits protection is Trusted ID, the service basically includes periodically reviewing and monitoring medical services provided to the subscriber to make sure no one else other than the designated subscribers are receiving medical care.

In order to prevent medical insurance fraud and the problems it can create for subscribers, the protection offered by these companies needs to improve significantly. They can effectively stop identity theft when it comes to credit accounts and can even detect your social security number floating around black market websites on the internet, but because medical identity theft is more complex, it’s a bigger challenge to tackle it as well as credit related crimes.

In spite of these deficiencies, the services are still a great way to outsource the tasks of monitoring your identity. It’s no doubt that these services are improving and innovating to provide better protection and monitoring your medical benefits usage maybe exactly what you need to keep yourself safe from medical identity theft.

Becoming a victim of identity theft is one of life’s most cruel experiences. How could this happen to you? You’ve worked hard for everything you have and now it may all be in jeopardy. What can you do when your identity is compromised?

You must now act quickly to deal with this before it begins to impact your life on a higher scale. Typically victims of identity theft assume the worst about the situation mostly because they’re not aware of their rights and the extent of the damage done to their credits or how to report identity theft. Under federal law you’re only responsible for the first $50 dollars of the accumulated debt charged under your name and often you can have that waved as well.

Do not volunteer to pay for the fraudulent charges no matter how small they are for this will may make you fully responsible for the charges and your dispute may become invalid. You are also eligible to receive a free copy of your credit report from all three credit bureaus if you are the victim of identity theft.

1. Contact your creditors to report your identity has been stolen

You will not be responsible for the fraudulent charges and the creditor can not hold you responsible as long as it can be proven that your identity was in fact used by someone else. Ask the creditor to either close or freeze the account so no more charges can be made. Then you must submit in writing a follow up on this request, making sure that your letter is sent to them via certified mail, you’ll need to keep your certified mail receipt to make sure you can prove they got your letter.

Once the creditor has done their investigation and you have been cleared of the charges, make sure you ask for a letter specifying this and keep it files somewhere safe. You’ll need this in case other charges reoccur, or if your credit report takes a hit because of these charges.

2. Contact the Federal Trade Commission and report your case

You can reach the FTC at:

www.ftc.gov/idtheft

1-877-IDTHEFT (438-4338)

TTY: 1-866-653- 4261

Identity Theft Clearinghouse

Federal Trade Commission

600 Pennsylvania Avenue

NW, Washington, DC 20580

Reporting identity theft to the FTC can help law enforcement crack down on identity thieves. The FTC also enforces your rights as a victim, so should a creditor insist on making you responsible the FTC can certainly help.

3. Contact the three credit bureaus and start fraud alerts on your credit report

There are two types of fraud alerts. An Initial fraud alert is typically done when you suspect that your identity is at risk, these alerts are good for 90 days and they can be renewed as needed. You’re also entitled to a free credit report from each credit bureau when you place an initial fraud alert. The second type of fraud alert is the extended, which you can do if you have already been a victim of identity theft, the extended alert will remain active for 7 years and you’ll also received your credit report twice a year free. Your name will also be removed from marketing lists and pre-approved lists.

Fraud alerts will help you prevent further theft or use of your information, when you have fraud alerts active, creditors must verify your information before approving any application for credit or service under your name.

• Equifax: 1-800-525-6285; www.equifax.com; P.O. Box 740241, Atlanta, GA 30374- 0241
• Experian: 1-888-EXPERIAN (397-3742); www.experian.com; P.O. Box 9532, Allen, TX 75013
• TransUnion: 1-800-680-7289; www.transunion.com; Fraud Victim Assistance Division, P.O. Box 6790, Fullerton, CA 92834-6790

4. File a police report

The next thing you need to do is file a report with your local police department and make sure you give all the details you can about the incident, you must also be able to prove to the police that you have been victimized by an identity thief so gather all the information you can from you credit card company or bank. The police do not usually handle cases like this since sometimes reporting on identity theft cases is beyond their jurisdiction so be prepared to deal with some bureaucracy, but you must succeed at getting the report filed if you can’t do it your local police department try your sheriff’s office.

When you do get the report filed, get it notarized and make several copies of it to keep handy because during the dispute process you will need to send this report to creditors and everyone else that requires it.

5. Be on the alert, report and take action

If your driver’s license number has been used Contact your state’s department of motor vehicles and report your case to them as well.

Contact your local post office if your mail has stopped arriving everyday and you suspect it is being redirected.

Contact the Social Security Administration (SSA). If you believe that your Social Security number has been used to fraudulently to obtain welfare or Social Security benefits, visit the SSA website at www.socialsecurity.gov/oig/guidelin.htm or call the SSA Fraud Hotline at 800-269-0271.

Contact the U.S. State Department. If your passport was stolen U.S. State Department website at www.travel.state.gov/passport/index.html or call 202-955-0430.

Change your PINs. If your ATM or debit card was stolen, do not use your old PIN for your new card. Choose a password that is obscure but that one that you will remember; do not use common numbers such as your birth date.

Identity theft victims should fill out an identity theft affidavit. The affidavit form is available from the Federal Trade Commission. Creditors may accept this affidavit when you make your claim that you are not responsible for a new account or for transactions on an existing account, but sometimes they require more. The information that you provide will enable the creditor to investigate your claim.

Start a log. As you make phone calls or send letters, keep notes of your conversations and correspondence with authorities and financial institutions, including dates, names, and phone numbers. Also keep track of all time spent and expenses you incur; you can deduct theft-related expenses on your income tax return, assuming you itemize deductions, and you may be able to seek compensation if you are ever able to sue the thief.

Finally, consider buying identity theft insurance either through your own insurance company or simply sign up to one of the many identity theft prevention services available to automate the process of protecting your identity with more sophisticated features like 24/7 monitoring of your credit and personal information.

Identity fraud normally occurs when the victim has absolutely no knowledge or control over what’s happening to them. Think of all the places where you have made a purchase with your credit card, either at a department store, restaurant or online. There is nothing stopping a dishonest employee from stealing your information or it could simply be careless handling of your information by the organization where they don’t secure their files properly and misuse easily occurs. Here are some identity theft protection tips to practice as a matter of habit:

Limit the number of items you carry in your purse or wallet

Losing your wallet or your purse easily becomes an opportunity for someone to commit identify theft. It’s a bad habit to carry your social security card, your driver’s license and all of your credit cards along with receipts and notes in the same wallet. No one ever realizes how risky this is until they lose their wallets. Another unfortunate mistake people make is to have the numbers for the credit card companies written on a piece of paper that was in their wallet or purse. Identity thieves are as opportunistic as they are resourceful.

Keep bills, financial statements and other sensitive personal information locked up at home

One of the places you never think about losing your identity is in your own home. We often leave bills and bank statements laying around kitchen counters, desks etc. If you never allow anyone into your home then you’re probably ok. But if you have visitors like contractors, cleaners etc who come to work for you in your home, you need to make sure you’re not exposing your sensitive data to anyone.

Shred anything that contains your name, address and financial information

Shredding machines are rather inexpensive. To some people this may sound like a hassle but it is so important to make sure that none of your unwanted statements leave your house in one piece. Some identity thieves still resort to “dumpster-diving”, which basically means they will dig through trash, as a way to gather any information they can use. In order to minimize the amount of paper statements, you can also request from all your financial institutions that they take you off of paper statements and have your statements emailed to you instead. The same thing goes for utilities and phone services.

Do not open spam email

The reason why spam has not gone away and will probably never go away is because it is still a very popular way to market, and recipients still open these emails. Spam mail is a prime avenue for identify theft, as it often contains viruses and other malicious code that can run as a background process and gather information while you’re active online. These malicious programs are an attempt to collect personal information from unknowing internet users with the purpose of harvesting their personal identities.

Credit card skimming

Whenever you pay with your credit card make sure you keep an eye on the person running the transaction for you, this is an opportunity for someone to skim your card. Skimmers are devices about the size of a credit card that someone can swipe your card through to read your card’s information to be used later. Whenever possible pay with cash and it is always a good idea to not sign the back of your credit cards but instead write the words “please check my ID”. Credit card theft is one of the easiest to do because credit card numbers are often mishandled.

Know who is calling you or emailing you requesting your information

Phishing is still a popular way of acquiring personal identity information, whenever you receive emails that appear to be from financial or insurance companies make sure you read them carefully. If they prompt you to submit any of your information as a way to verify your account, simply delete the email. Financial institutions DO NOT request your information via emails or phone calls, they already have it. Rather than surrender this information when they call you ask questions to find out exactly who they are. Should the request sound legitimate contact the toll free number from the organization’s website and call them to verify.

Take your name off marketing lists

If you’re not aware of the national Do-not-call registry, visit their website (https://www.donotcall.gov/), this is an act that protects you from getting calls from most telemarketers.

Review your credit card statements and check your credit report often

Reviewing your credit card and bank statements can give you some early detection when you see charges that you do not recognize. You also need to check your credit report often and make sure you setup free fraud alerts. These will tell you when changes have occurred to your credit report and this is a clue to investigate what the change is, especially if you have not initiated anything.

Report suspicious activity

Should the worse happen and you fall victim of identity fraud, do not wait to contact your credit card companies or banks immediately to freeze your accounts and keep further charges from taking place. You should also report the incident with the credit bureaus and ask them to put fraud alerts on your file, and finally contact your local police department and ask them to fill out a police report on the identity theft crime that you’ve been a victim of.

Sign up for credit monitoring / identity theft protection

Although you’re able to accomplish most of what these services can do on your own, it simply is not practical enough for a single person to monitor their credit or identity 24/7. These highly specialized services make use of state of the art technology to monitor the identities of millions of subscribers and provide them with accurate and prompt alerts when suspicious activity is taking place involving their identity.

Identity theft can occur in a variety of ways, people usually find out they have been victimized when it is too late to begin protecting themselves. With more and more people connecting to the internet every year the opportunities for identity thieves are never scarce. The internet has provided a great number of benefits to the world but along with these benefits come the ongoing risks of online identity fraud. The internet is only one medium that enables thieves to steal identities but it isn’t the only one, there are many other causes of identity theft.

Pre-Approved Credit Offers

Your personal information is traded between merchants, credit providers and the credit bureaus and unfortunately there is no law that can stop this practice, it can only be regulated. But these regulations do not properly address the security of your information as it gets exchanged. Pre-approved credit offers are one of the easiest ways to become a victim of identity theft because often these offer letters do not make it to their intended destination. Also, they are often thrown away whole, sometimes still in their envelopes. This risk can be avoided by shredding every piece of paper that contains any information of yours, but it would be best to simply opt out of pre-approved offers and one of the most convenient ways to accomplish this is when you enroll in an identity protection plan, since the plans will take care of removing your name from all pre-approved offers and junk mail lists.

Accessing to Public Records

Public records are the information that’s freely and easily available to anyone. This includes bankruptcy records, court records, fictitious name filings, marriage registration, real estate property records etc. All of this information can be accessed by anyone and it is often available at no cost. A person can get a great deal of detail about you from these records and it can be utilized to get credit or redirect your mail to an alternate location where an identity thief can receive it and learn even more about you.

Online Phishing Scams

One of the most common causes of identity theft is online phishing. This is still an effective method for identity thieves. If you have a Paypal account, you have more than likely received an email at one point or another asking you to verify your information by following a link that’s provided in the body of the email. Once you go to the website and enter in your information you’re typically redirected to a page that tells you that your information has been verified leaving you to think that you did the right thing, when in fact you just rendered your login information to the thief who operates the site. These emails are normally written to give the recipient a sense of urgency, normally expressed in the subject line that says something to the effect of “your account has been compromised” and that you must verify it now before it gets suspended. It’s a good trick that’s worked very effectively over the last five years, but more people are becoming aware that these are nothing more than identity fraud attempts.

Spear Phishing Scams

Because phishing alone is no longer as effective, identity thieves have become more resourceful and have gone so far as to target individuals specifically. This is normally done when they have learned more about the victim and realize that there’s potential for high gains by gathering even more information rather than just steal a credit card number. If identity thieves believe that you have major assets they might be able to exploit they will use more sophisticated methods for getting you to voluntarily surrender your information. This can be in the form of a direct phone call or an official looking letter from your financial institution in which they list information that looks and sounds official. They could also use public record information to inform themselves about you and sell you on the idea that they are a legitimate party trying to solve an issue for you.

Internet Security and Old Browsers

Another one of the common causes of identity theft are internet users who are simply not aware of the dangers of being connected to the internet without the proper protection. To protect against identity theft properly everyone needs to have Antivirus and firewall protection to keep malicious programs from entering your computer system. There are a number of malicious programs that can be installed on your system in passive mode that can compromise your personal information. Programs such as keyloggers are one of the many ways hackers get access to your information. These programs record every keystroke you type especially when you’re online then transfer this information to the thief. In other words any information you type can be seen by someone else including bank account login information, credit accounts and any other online destinations you normally access.

Old browsers are another serious problem that you have to address, but luckily it’s a simple fix. The older versions of Internet Explorer have a series of security holes and no one should ever access the internet using Internet Explorer 6 or below. All browsers are free to download and install, among the safest browsers available are Mozilla Firefox and Opera. Although no browser is 100% secure, you have more security features in Firefox and Opera.

Spam and pirated software

No matter how long you’ve been online, you probably have heard the word spam a number of times. Spam is a term used to describe the unsolicited emails that you receive on a daily basis that typically promote products. Spam is also a danger because of malicious code that can potentially run when you open these emails. Often these products are pirated popular software that’s offered at a huge discount. Even if you don’t buy the software, accessing the destination sites in these emails can be dangerous if your computer system is not properly protected. Also using pirated software is an easy way to fall prey to identity thieves. The software that you download free from these sites is often coded with Trojans that work silently gathering your sensitive data. So even though it may sound like a good offer, you’re better off deleting spam.