An Identity Theft Update

This year marked the tenth anniversary of the passing of New Jersey’s Identity Theft Prevention Act.  At the time, the federal government considered identity theft to be the fastest growing financial crime.  According to Identity Theft and Phishing, a 2009 report from the NJ Department of Consumer Affairs, a thief steals someone’s identity and open accounts in that person’s name on the average of every 79 seconds.  Fast forward to 2016, and the threat of identity theft has not diminished in the slightest.  The website Statistic Brain offers the following statistics:

• Average number of U.S. identity fraud victims annually: 12,157,400
• Percent of U.S. households that reported some type of identity fraud: 7.5 %
• Average financial loss per identity theft incident: $5,130

The site goes on to report a total financial loss attributed to identity theft in 2010 to be $13.2 million, a figure that nearly doubles by 2014 with $26.4 million.  So what does the consumer of 2016 need to look out for when it comes to identity theft?  Some rules have stood the test of time.  Others have emerged as the crime’s roots in cyberspace has grown deeper.

1. Sign up for the federal Do Not Call List: As mentioned in a previous post on telemarketing fraud, the Do Not Call List remains as effective as ever. The web address is still donotcall.gov. One important note to remember is that the list does not apply to charities.  This means that legitimate charities will be difficult to distinguish from fraudulent ones.  So, your best bet is to play it safe and avoid giving personal or credit card information, or simply avoid such calls all together.
2. Opt out of pre-approved credit card offers:  They show up daily and you barely pay any attention to them.  Identity thieves can steal these right out of your mailbox and then apply for credit in your name.  You can opt out of these offers by going to optoutprescreen.com.
3. Check your credit report:  Head over to annualcreditreport.com to get free credit reports. Then, check your credit report at each of the three credit reporting agencies, Equifax, Experian and TransUnion.  Federal law gives you the right to get one from each for free. If you stagger your request, you can get one every four months.  This maximizes your chances for spotting fraudulent charges. The sooner you do, the easier it is to fix.
4. Get an EMV chip credit card:  Have you been asked about “the chip” yet? If you have stopped at your local 7-11 recently, you probably have.  Major retailers such as Target and Home Depot began reporting widespread identity theft due to poor security in their Point-Of-Sale (POS) terminals.  Since then, multiple banks and card issuers such as American Express Bank of America, Citibank and Wells Fargo have announced cards with EMV chip-and-signature technology.  Instead of a magnetic stripe and signature, the security of your identity now relies on a PIN and something called “cryptographic algorithms.”

So what are cryptographic algorithms anyway?  Do not be scared.  They are just the processes that keep data out of the wrong hands by coding and decoding it.  It is a safe transaction between two parties with any third unwanted party blocked from illegal access.  One can only imagine what those unwanted parties have in store for a response.  So what can you do to protect yourself from identity theft in 2016, aside from the aforementioned guidelines?  Use a strong, unique password for all of your accounts.  Be sure the answers to your security questions cannot be easily determined using common sense or rudimentary cyber-sleuthing. When all is said and done, if you have been scammed by a fraudster, you should contact a consumer law attorney.  Contact the the Law Office of H. Benjamin Sharlin LLC for a free consultation.