For most of us, the terms identity theft or fraud bring to mind fraudulent Web sites that try to phish for our personal information or viruses that send our sensitive data to a criminal. Surprisingly, a new study by Travelers Insurance revealed that the information gathering that makes identity fraud possible most often takes place offline.
Identity fraud has been growing dramatically, by 22% each of the past two years. Based on the incidents reported to Travelers, the number one cause of identity fraud is old-fashioned burglary in which a wallet, purse, other personal identification, or computer are stolen. Theft of personal property was responsible for 78% of the cases of identity fraud with online issues or data breaches only accounting for 14%.
What's the difference between identity theft and identity fraud?
"Identity theft is when a criminal steals your personal information. Identity Fraud is when a criminal uses that ill-gotten personal information in order to commit a crime or fraud all in the name of the identity theft victim." said Joe Reynolds, Identity Fraud Product Manager at Travelers In an email he stated, "Although consumers should be concerned about identity theft, they should be even more concerned about the potential for identity fraud as the direct impact on consumers is much greater once their name is used in the course of committing a crime."
Travelers Insurance's Top 10 tips to prevent identity fraud
1. Review your wallet or purse contents before you go shopping. Common theft is the easiest way for a criminal to steal your identity and commit fraud. Before you go shopping, think about how much information a thief would obtain if your wallet or purse was stolen. Avoid carrying Social Security cards, birth certificates or passports unless absolutely necessary. Don't carry extra credit cards unless you plan to use them.
2. Create a list of all your credit card and bank account information and store in a secure place. Be sure to include account numbers, expiration dates and credit limits. Also include the telephone numbers or e-mails or the customer service and fraud departments. If you find your card missing or stolen, refer to this list and immediately notify your credit card provider of the loss. This not only prevents fraudulent charges, but it also notifies your provider if the card is used again.
3. Protect your Passwords and PINS. When creating passwords and PINs, do not use the last four digits of your Social Security number, mother's maiden name, your birth date, middle name, pet's name, consecutive numbers or anything else that could easily be discovered by thieves. It's best to create passwords that combine letters and numbers.
Ask your financial institutions to add extra security protection to your account. Most will allow you to use an additional code or password (a number or word) when accessing your account. If asked to create a reminder question, do not use one that is easily answered by others. Memorize all your passwords. Don't record them on anything in your wallet.
4. Review your credit report now – and after the New Year. One of the easiest ways to see if a criminal is using your identity is to review your credit report. Be sure to report mistakes to the credit bureaus. A federal law gives consumers the right to receive one free copy of their credit report every 12 months from each of the three main credit bureaus (Experian, Equifax, TransUnion).
Order a report today from one bureau and review it, looking for discrepancies. A couple months after the New Year, order another report from a second bureau. Four months later, order a report from the third bureau. Doing this will enable you to see snapshots of your credit throughout the year at no cost.
5. Never provide confidential information over the phone to an unsolicited caller claiming that they represent a financial institution or creditor. Criminals will use your social security number to open up fraudulent accounts or gain access to financial information or assets, especially around the holidays. Do not have your Social Security number printed on your checks and do not allow merchants to write your Social Security number on your checks. If a business requests your Social Security number, ask them why they need it. If you aren't convince the reason is valid, don't provide it. If you receive an unsolicited call and are asked to provide information, get the caller's name, location, telephone number, and reason that they are calling. Call them back at the phone number on your billing statements to verify the caller's identification.
6. Never put outgoing checks or bill payments in your home mailbox, as they are easy to steal. While sending checks is a popular and desired holiday gift, it also has its risks, as thieves can steal mail containing checks and gain other personal information from bills and financial statements. Where practical, drop all items containing checks or financial information in a secure postal mailbox or at the post office
7. Log off completely when finished with online transactions. Closing or minimizing your browser or typing a new Web address may not be enough to prevent others from accessing your online information. Instead, click "log off" to terminate your online session. In addition, don't allow your browser to "remember" your user name and password information.
8. Increase up your own computer's security. Personal firewalls and security software packages (with anti-virus, anti-spam, and spyware detection features) are a must-have for those who plan on shopping online this season. Make sure your computer has the latest security patches, and make sure that you access your online financial accounts only on a secure Web page using encryption.
9. Avoid e-mailing personal and financial information. Although your computer may be "well protected" with proper firewall, anti-virus, Internet security or encryption software, the individual or company receiving your information may not have similar security in place. Always confirm with online retailers that they have proper Internet security in place before responding to any e-mail request.
10. Delete, without replying to, any suspicious e-mail requests. Hackers and spammers often impersonate retailers to lure you to divulge personal financial information. If there is any reason to doubt the authenticity of an e-mail message from a company you do business with, don't click on links or buttons in the message. Instead, type the Internet address of the company into your browser, log on as you usually do, and examine your account information. You may also telephone a company to ask if an e-mail is legitimate.
For additional resources on identity theft and fraud read how to stay safe as you shop online and WalletPop's Identity Theft category.
Online theft not the main cause of identity fraud