Someone just stole your name, your Social Security number, your credit card information. They ran up a big bill. What do you do? And how do you avoid it in the first place?
When you get the dreaded news you’re a victim of identity theft, it’s a shock. This news takes a while to sink in. Can it be true? Who could masquerade as you? What are they doing as you? What damage have they done? The questions never end. You are awash in anxiety. Now what do you do?
First, who contacted you about the theft? Are they reliable? Do you do business with them, and how would they suspect identity theft? Sometimes identity thieves are fishing for information, and try to get it by alerting you to a theft that hasn’t occurred yet. They want you to identify yourself – and reveal your secrets. In other words, stop and think before responding to that alarming email.
Some scammers have a great deal on gold to offer you. Or they pretend to be the Internal Revenue Service and ask you to reveal vital data. Read more on scams in my blogs. If you Google “identity theft” you get many results, but concentrate at this point on the federal and state government official websites.
Okay, so let’s say the warning appears to be real. Contact who notified you – not by email. In person or by phone. How do they know about the scam? You’ll need that information to file a police report.
A few consumer resources to help you resolve identity theft are: IDtheft.gov, the Federal Trade Commission’s Identity Theft site, U.S. Department of Justice and the California Department of Justice, in the state where I live, or Google your state’s DOJ for identity theft help.
Here’s how to minimize your risk of identity theft:
1. Be on guard when you are online. Some scammers, claiming to be from a reputable company like Microsoft, call to tell you that your computer is infected with viruses. They talk you into granting remote access to your machine.
I don’t necessarily endorse non-government websites. They are merely provided as possible additional resources. Consider carefully what you do with any website before you enroll in a program, send money or provide personal information. Most legitimate websites on this topic provide services free of charge and don’t need personal information to help you.
2. See if you are you at risk before the unthinkable happens. MyIDScore.com is a free analytics site so you may check your risk and take appropriate actions to reduce your risks.
3. How honest is your tax preparer? Few people think of this, but your preparer gets all kinds of handy information that may also be used for identity theft. Various states have sites to check out yours. Where I live, there’s the California Tax Education Council’s website to verify your tax preparer. Are they legitimate? Look for helpful information links on the side panel navigation bar once on the site, especially the “Verify a Tax Preparer” link.
4. Be especially careful about IRS scams. You won’t get a phone call or email “out of the blue” from the IRS. You will get official correspondence by snail mail first. Before you do anything, I suggest you talk to your tax preparer who filled out your return. If you don’t have a tax preparer, contact a certified public accountant or tax lawyer.
Many people fret about their data getting compromised on some server somewhere. Those servers are getting harder for a common thief to crack; and more sophisticated criminals are after bigger fish. So the common thieves go after the softer target – you.
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Larry R. Frank Sr., CFP, is a Registered Investment Adviser (California) in Roseville, Calif. He is the author of the book, Wealth Odyssey. He has an MBA with a finance concentration and B.S. cum laude in physics with which he views the world of money dynamically. He has peer-reviewed research published in the Journal of Financial Planning. www.blog.BetterFinancialEducation.com.
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