"But he that filches from me my good name/Robs me of that which not enriches him/And makes me poor indeed." (William Shakespeare, Othello, act iii, Sc. 3)
Shakespeare evidently knew a thing or too about the meaning of identity theft . . . and so should you. Identity theft occurs when a crook wrongfully gets and uses another person's personal information, using some method of fraud or deception, usually for economic gain at the victim's expense.
An identity thief seeks personal data such as your Social Security number, your mother's maiden name, bank account information, credit card info or a telephone calling card. Identity thieves have been known to use someone else's personal data to — among other things — deplete someone else's bank account, run up thousands of dollars in charges on a victim's credit cards, or obtain a home loan.
Identity theft victims could spend several thousand dollars and take years to restore their reputations and good credit standings.
Identity thieves use various techniques to obtain a potential victim's personal data. For example, they have been known to rummage through garbage cans (also known as "dumpster diving"); walk off with personal or business records at work; steal mail, wallets or purses; or pose as a landlord or employer to obtain credit reports.
The Federal Trade Commission (FTC) recorded 246,035 complaints of identity theft in 2006, with credit card fraud accounting for 25 percent of identity theft uses. The top states for identity theft were Arizona, Nevada and California.
The Federal Trade Commission (FTC) offers these strategies for reducing your risk of identity theft.
Protect your Social Security number
Don't carry your Social Security card in your wallet or write your Social Security number on a check. Give your Social Security number only when absolutely necessary, and ask to use other types of identifiers.
Treat your trash and mail carefully
To thwart an identity thief who may pick through your trash or recycling bins to capture your personal information, always shred your charge receipts, copies of credit applications, insurance forms, physician statements, checks and bank statements, expired charge cards that you're discarding, and credit offers you get in the mail.
To opt out of receiving prescreened offers of credit in the mail, call 1-888-5-OPT-OUT (1-888-567-8688). Note that you will be asked to provide your Social Security number which the consumer reporting companies need to match you with your file.
Put your outgoing mail containing personally identifying information in post office collection boxes or at your local post office rather than in an unsecured mailbox. Promptly remove mail from your mailbox.
Select intricate passwords
Place passwords on your credit card, bank, and phone accounts. Avoid using easily available information like your mother's maiden name, your birth date, the last four digits of your Social Security number or your phone number, a series of consecutive numbers, or a single word that would appear in a dictionary.
Combinations of letters, numbers, and special characters make the strongest passwords. When opening new accounts, you may find that many businesses still ask for your mother's maiden name. Find out if you can use a password instead.
Verify a source before sharing information
Don't give out personal information on the phone, through the mail, or on the Internet unless you've initiated the contact and are sure you know who you're dealing with. Identity thieves are clever, and may pose as representatives of banks, Internet service providers, and even government agencies to get people to reveal their Social Security numbers, mother's maiden name, account numbers, and other identifying information.
Store information in secure locations
Keep your personal information in a secure place at home, especially if you have roommates, employ outside help, or are having work done in your house.
Keep your purse or wallet in a safe place at work.
Many states have laws that let you "freeze" your credit to restrict access to your credit report. If you place a credit freeze, potential creditors and other third parties will not be able to get access to your credit report unless you temporarily lift the freeze. This means that it's unlikely that an identity thief would be able to open a new account in your name.
Placing a credit freeze does not affect your credit score, nor does it keep you from getting your free annual credit report or from buying your credit report or score. Credit freeze laws vary from state to state and there may be a fee.
If you're really worried and think you're at risk, you can buy identity theft insurance coverage. Such insurance protection would reimburse you for costs of restoring your identity and repairing personal credit reports.
Identity theft coverage is standard in many homeowners policies, so check your current coverage to see what amount you have. Other insurers market coverage as an endorsement to homeowners or renters insurance policies or sell that protection as a stand-alone policy.
The FTC suggests you to consider these factors when purchasing identity theft insurance:
The amount of coverage the policy provides.
Whether it covers any lost wages (and, if so, whether there's a cap on the wages you can claim, or a separate deductible).
The amount of the deductible.
What is be excluded from coverage (for example, if the thief is a family member or if the thief made electronic withdrawals and transfers).
Whether the policy provides a personal counselor to help you resolve the problems of identity theft. One of the major "costs" of identity theft is the time you will spend to clear your name. Many companies and law enforcement officers will only deal with you (as opposed to an insurance company representative). So even if your policy provides you with a personal counselor, that counselor can often only guide you, as opposed to doing the work to clear your name.
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