Facts you really need to know about identity theft: Internet ScamBusters #117
Today's issue is about a very surprising aspect of identity theft. We suspect you don't know who commits the most identity theft -- and why it's so important that you do know. So, let's jump right in...
Identity Theft Often Begins at Home
You'd almost have to live in a cave not to know about identity theft. It's in the news on a regular basis. In addition, you may have already been a victim -- or know someone who has been victimized.
Everyone also seems to be aware that electronic identity theft -- through email, online banking or using credit cards online -- costs consumers millions of dollars every year, and the numbers are escalating.
For the fifth year in a row, identity theft topped the list of complaints reported to the Federal Trade Commission in 2004, accounting for 39% of all complaints received annually by the FTC. It also tops our ScamBusters prediction list of the worst Internet scams for 2005.
The consequences of becoming a victim of identity fraud include: having a scammer open up accounts in your name (and running up debts to those accounts), losing your job, being denied insurance, or even being arrested for crimes you didn't commit.
A Surprising Fact About Identity Theft
However, what you may NOT be aware of is that fully 50% of reported identity fraud is perpetrated by relatives, friends and neighbors, or acquaintances of the victim.
That's a truly amazing statistic. And whereas many people think that computer crimes account for most identity theft, computer crimes, in fact, only accounted for 11.6% of all identity theft where the cause was known in 2004.
According to a survey done by Javelin Strategy & Research, these 'close encounters' by friends and family are costing much more money -- and time to resolve -- than 'stranger' fraud would.
Here's an example: the median loss from phishing scams is $2,320. But when the identity theft is a result of fraud by family and friends, the median loss is $15,607!
So how do you decrease your chances of your identity being stolen by a neighbor or a nephew?
Here are 5 identity theft prevention tips:
1. Don't give ANYONE access to your PIN numbers.
2. Don't leave financial mail or statements lying around your house or your car -- you'd be appalled at how much information can be gleaned from your checkbook, bank statements, credit card account statements and tax records.
3. When you are discarding things, shred any personal documents that may contain personal or financial information.
4. As much as possible, sign up for electronic banking and account monitoring, and then review your accounts regularly. Any fraud will be detected sooner -- and more easily -- than if you wait for monthly mail.
5. Review your credit report, bank accounts and credit card bills frequently. Self detection is the best way to find out about identity fraud early.
Action: Follow these tips and be vigilant to protect yourself from identity theft from people you know. And also follow the tips from previous issues to protect yourself from identity theft from strangers.
That's it for now. See you next week...