How to Thwart I.D. Thieves

Identity theft is an epidemic, sapping people’s bank accounts. How do you protect yourself? By being vigilant: monitoring your credit report, bank and card statements, then moving quickly to squelch illicit charges.

The indispensability and ubiquity of technological innovations give the bad guys an in. Making our lives simpler and more efficient, the Internet, smartphones and iPads are key to how we communicate and store information. So much so that people pay big bucks to go to special technology-free resorts for a break from the unrelenting onslaught of information.

As technology eases access to sports scores, YouTube videos and Facebook, it also gives scoundrels an opportunity for identity theft. Last year, the Consumer Sentinel Network, a division of the Federal Trade Commission, received over 2 million complaints – more than half of them regarding fraud and identity theft.

According to a recent survey conducted by consulting firm Protiviti, 68% of companies have increased their focus on information security as threats of cyber-warfare increase each year. But 34% of companies report that they either are not prepared or do not know if they are ready for a data security breach – an unsettling statistic for millions of consumers in the U.S.

You may remember the old commercials for LifeLock, in which Chief Executive Officer Richard Davis publicly advertised his own Social Security number to show his confidence in his company’s ability to protect customers from identity theft. Ironically, a class-action lawsuit filed in 2008 revealed Davis did in fact suffer such a fate. A thief used his Social Security number at a payday lending store and obtained a $500 loan in Davis’ name.

So how do you prevent identity theft and what do you do in the event your personal information is stolen? Preventive action is always the best strategy. The Fair Credit Reporting Act guarantees you access to your credit report every 12 months via a website called AnnualCreditReport.com. Checking your credit report for any suspicious activity is a great way to monitor your financial identity.

Reviewing your bank and credit card statements is also a crucial step in ensuring no one has gained unlawful access to your accounts. It is also important to not disclose your personal information to just anyone or any website; your identity is your responsibility to protect.

If you do discover that your accounts have been compromised, call your bank and credit card companies to stop further charges and make sure you aren’t on the hook for the fraudsters’ purchases. By law, you are only responsible for up to $50 per credit card for any unauthorized charges.

However, as Richard Davis demonstrated, there is no impenetrable protection from identity theft. We must always be on the lookout in order to protect ourselves as well as our financial future.

Follow AdviceIQ on Twitter at @adviceiq.

 

Joseph “Big Joe” Clark, CFP, is the managing partner of the Financial Enhancement Group LLC, an SEC Registered Investment Advisory firm in Indiana. He teaches financial planning at Purdue University and is the host of Consider This with Big Joe Clark, found on WQME and iTunes. He is a Registered Principal offering Securities and Registered Investment Advisory Services through World Equity Group, Inc, member FINRA/SIPC. Big Joe can be reached at bigjoe@yourlifeafterwork.comor (765) 640-1524. Follow him on Twitter at @Big Joe_Clark and on Facebook at http://www.facebook.com/FinancialEnhancementGroup.

Securities offered through and by World Equity Group Inc. Member FINRA/SIPC. Advisory services can be offered by the Financial Enhancement Group (FEG) or World Equity Group. FEG and World Equity Group are separately owned and operated.
 
AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty. For instance, the rankings this week measure the number of clients whose income is between $250,000 and $500,000 with that advisor. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.