Identity Theft

Update 2: I've written a summary of my thinking after a presentation on identity theft at our December 17, 2009 meeting.

Update: "The Federal Trade Commission made public some startling statistics on identity theft this week. According to their own survey data, 27.3 million Americans have been victims of identity theft in the last five years, and a whopping 9.9 million people joined this unfortunate list in just the last 12 months." --PC Magazine

All an identity thief needs is your name, your credit card number, and $100 to buy a credit report that also includes your social security number, date of birth, etc. Armed with those details, it's easy to to get a bunch of credit cards in your name and max them out. Some people have even been jailed for crimes the imposters commit. The paper trail tells the police just where you live. :-)

Precautions you should take

More people have their identity stolen in the "real" world than the virtual world. The first several items really don't have anything to do with the Internet, but they're an important part of the total package.

• Do not carry your social security number in your wallet or purse. Be wary of who you give your number to. Unfortunately, Medicare and other insurance cards have your SSN right on them. I don't know what you do about that. Don't lose your wallet I guess. :-(
• Never provide your social security number or any other personal information to anyone online unless you initiate the contact.
• Protect yourself against "dumpster-divers". If you don't have a fireplace, get a crosscut shredder (not a simple strip shredder). Shred everything with your name, SSN, credit card numbers, etc., on it before throwing it out: account statements; credit card receipts; "preapproved" credit card offers; "free" checks to "pay off balances" -- you get the idea.
• Do not mail payments from your residential mailbox. Mail them at a post office or blue postal box.
• Close unused or little-used credit card accounts.
• Dispose of credit cards safely. I do that by cutting them up in a way that both my name and account number are split in separate parts. Then I put the pieces in the garbage on different weeks.
• Get free credit reports each year from all three of the credit reporting bureaus. Look for discrepancies or unexpected entries. Any unusual activity may be a sign of trouble.
• Immediately contact the top three credit bureaus as soon as you suspect someone has used your identity. You can get free credit reports if you believe you are a victim, and they will place fraud alerts on your accounts. They are: Equifax 888-766-0008; Experian 888-397-3742; and Trans Union 800-680-7289.
• Put "strong" or "robust" online defense in place. If you've been online without it, consider restoring or reinstalling Windows before you start doing the defense work. It may simply be too late if surveillance software has already intruded.
• Don't use public PCs like the ones in Internet Cafes or Public Libraries to do business online. Many of these public machines have surveillance software, like keyloggers installed. Guess where your information goes -- right to fraudsters who know how to use it to clone your identity for their own use. [more]
• Purge your hard drive before you sell or give your computer away. Don't just erase the sensitive files, and empty the Recycle Bin. The files will still be there. Even formatting the drive won't remove them.

More on the Web

• MSN Money covers the basics very nicely in "10 ways to stop identity theft cold".
• The Securities and Exchange Commission (SEC) has particulary well-written advice on safeguarding your online brokerage accounts (or any financial accounts for that matter).
• http://www.google.com/search?q=identity+theft+prevention
• "How Identity Theft Works" -- click the "printable version" when you get there
• Call for Action -- network of consumer hotlines [list of precautions] [publications]
• U.S. Government central website for information about identity theft
• Privacy Rights Clearinghouse -- Identity theft resources
• CDIA -- information from credit bureaus