“But he that filches from me my good name
Robs me of that which not enriches him
And makes me poor indeed”
Shakespeare, Othello, act III, sc. 3
Did identity theft or fraud exist in Shakespeare’s time? Likely. But clearly not as prevalent as it is today.
What is identity theft and fraud?
Identity theft and identity fraud are terms used to refer to all types of crime in which someone wrongfully obtains and uses another person’s personal data in such a way that involves fraud and deception for economic gain.
For a more formal definition, according to Wikipedia, “Identity theft is a term used to refer to fraud that involves someone pretending to be someone else in order to steal money or get other benefits. The term dates to 1964 and is actually a misnomer since it is not inherently possible to steal an identity, only to use it.” Additionally, according to Wikipedia, “Identity theft is somewhat different from identity fraud. However, the terms are often used interchangeably. Identity fraud is the result of identity theft. Someone can steal or appropriate someone else’s identifying information without actually committing identity fraud.”
Unlike your fingerprints, which are unique only to you, your personal data such as your Social Security number, your bank account or credit card numbers, telephone calling card number, and other valuable identifying data can be used against you if they fall into the wrong hands. Victims of identity theft have reported funds taken from their bank accounts, large debts piling up on their credit cards, new cards established using the victim’s name and, worst case scenario, committing crimes using the victim’s name. Becoming the victim of identity theft or fraud is devastating to you personally but it can have a negative effect on your reputation and that of your company (especially if the accounts are in a D/B/A (Doing Business As) account.) Often the victim’s losses may include not only out-of-pocket losses, but a great deal of additional cost and personal time trying to restore his or her reputation in the community and correcting erroneous information for which the criminal is responsible.
To make matters worse for victims of identity theft and fraud, there is a very lucrative market for selling the victim’s information to potentially thousands of individuals, worldwide.
When employers ask you to provide personal information as part of the employment – such as your social security number – ask them what is done to protect the information. Where is it stored? Who has access to the information? Has there ever been a breach of the system where the data is stored?
Similarly, if you provide your credit card number to make a purchase – pay attention to who you are providing it to and how. For example, if you are on a website to make a purchase – is the transaction secure? Do you see “https” in the URL field? If not, don’t provide your credit card! Is this the first time you are purchasing from the website – do a bit of research about them first.
How is Identity Theft or Fraud Perpetrated?
In just two words, very easily! Here are a few methods of which you should be aware:
Dumpster Diving: This method is exactly as it sounds. Criminals go through your trash at work or in the communal dumpster at the office, or through your trash bins at your home to obtain copies of checks, credit card or bank statements, utility statements or any other documents that might contain personal information on you, your employees, or your clients. These individuals are also looking for “pre-approved” credit card information that so many of us receive regularly in the mail.
The U.S. Mail: If your mail is delivered to a place where others have ready access to it, criminals may intercept and redirect your mail to another location. Criminals have admitted to stealing bank statements or other correspondence that they know contain personal information from mail boxes. And certainly, similar to above, this is a great place to get “pre-approved” credit card information.
Shoulder Surfing: This method of getting your information involves the criminal watching you from a nearby location as you punch in your telephone calling card number or credit card number or listen in on your conversation when you give your credit card number over the phone when renting a car, getting a hotel room, or any number of other reasons. The criminal may use this method to get your pin number for banking purposes.
The Internet/Emails: The web is an appealing place for criminals to get your personal information. One of the most common methods is posting emails for merchandise, a service or a fake charity. Criminals like to use the charity theme especially after a major disaster such as the recent earthquake in Haiti. The email sent by the criminals look very real and is convincing enough that thousands of people have fallen victim, giving personal information, including their credit card numbers, only to have their identity stolen.
The Telephone: Fraudulent telemarketing is a very popular method and is widely used. Unfortunately, frequently senior citizens are frequently targeted via the telephone. Often the company sounds legitimate and the offer is one you just cannot pass up.
(On a personal note, last week I received a call from the “First Church of Haiti” wanting donations, either in the form of a check or, to make donating easier, the caller (with a fake accent) said he would be glad to take my debit card number and debit the donated amount. A bit of research will enable you to determine the validity of the caller! Unfortunately, too many individuals will use real disasters to take advantage of others.)
What can you do to protect yourself and your business? Remember this acronym SCAM:
S: STINGY: Be stingy about your information.
If you have a shredder, use it often. If not, purchase one as soon as possible and use it! Shred credit card offers that come in the mail, documents you receive with personal data on it, client information, etc.
Adopt a “need to know” approach to all data. Your bank and credit card companies have all of the security answers they need on file. A person who calls you and says he or she is from your bank or credit company, does not need to know what is already on file; the only purpose of such a call is to acquire the information for the caller’s benefit.
Put your name or the name of your company on your checks along with an address. There is no need to include a pre-printed phone number on checks.
Do not respond to any unsolicited emails or phone calls. Remember, if it is too good to be true, it is! Never give any personal information unless you know who you are speaking with on the phone. You can always tell the individual on the other end to provide more details including a call back number and then “google” that number for verification.
C: CHECK and double-check.
Check your personal and business financial information regularly for errors or information that doesn’t make sense to you. If you receive monthly bank and credit card statements by mail or over email and suddenly stop receiving this information, contact the financial institution or credit card company immediately and find out why.
Many of us give statements a quick glance then file it away to be paid at a later date. Review every statement carefully personally – even if this is handled by an accountant.
Banking online is a great way to keep current with your accounts activity – just make sure you choose a password that is not common and is difficult to be hacked.
A: ASK.
Periodically request a copy of your credit report. Your credit report will list all bank and financial accounts under your name or your company’s name. A careful review of your credit report will tell you if someone has wrongfully opened or used any accounts in your name.
M: MAINTAIN.
Maintain careful records of your banking and financial accounts and transactions, or see that your accountant is doing this for you. And…if the accountant does manage this for you – make sure it is regularly monitored and updated.
What Should You Do If You Think You Are the Victim of Identity Theft?
Act immediately to minimize the damage to your personal or business funds and financial accounts, not to mention your reputation. Make a copy of your account numbers and that institution’s fraud department’s phone numbers to keep in a very safe place so that you can access it immediately.
Some suggestions on who to contact if you believe you or your company is a victim of identity theft:
The Federal Trade Commission (FTC). Under the Identity Theft and Assumption Deterrence Act, the FTC is responsible for receiving and processing complaints from persons who have reason to believe they are the victims of identity theft or fraud.
Contact the Social Security Administration if your suspect your Social Security Number is being used fraudulently.
Contact the fraud units of the three principal credit reporting companies: Equifax, Experian, and Trans Union.
Contact your banks and all creditors and notify them of the theft.
Contact the Postal Inspection Service if you believe the theft is a result of your mail being compromised.
Contact your local police department and the FBI.
Remember – keep notes/records of everyone you have contacted, the name of the individual you spoke with, and the date and time of the call.
No person or company is immune to identity theft or fraud, but being educated on how to avoid becoming a victim and how to minimize the damage if you are a victim goes a long to sparing you and/or your company from the possible financial ruin that identity theft or fraud can cause.
Interested in more information on how to protect your identity? Contact Sandy Glover at Gold Shield Legal Investigations, Inc.
This article does not provide legal advice nor is it intended to do so.
Resources
Information for this article was obtained from:
The Federal Bureau of Investigation.
Federal Trade Commission-Fighting Back Against ID Theft.
The United States Postal Inspection Service.
National Fraud Information Center.
Copyright © 2010 Sandy Glover
Great article- very thorough and informative!