Financial Identity Theft
What is "financial identity theft"?
Financial identity theft is when someone begins to open up bank accounts and credit card accounts under your name. They start to take out loans under your name, get credit cards under your name. Eventually, unfortunately, they usually default on those accounts and then they damage and soil your credit.
What kind of information does a financial identity thief want?
When it comes to financial identity theft, generally they're looking for basic information like name, address and social security number; in addition to that they really like to get hold of your credit card numbers, also too what is very valuable to them is the banks you deal with, any deeds to homes, any titles to homes that they can then go and use to refinance your existing property and then take on even bigger loans, and then they can actually default on those loans and thereby making you a victim of mortgage fraud.
What is the most common way that identity thieves steal financial information?
One way to get your specific financial information is: either to extract your credit card information at any retailer that you may do business with, or they can easily go into your trash and get the statements that you may throw away. That's why I always recommend that people shred anything and everything, with any account information, especially any financial data. The unfortunate fact of credit card fraud is that there's really no way to protect your credit cards. In general, when people ask me, "How do I protect my credit card number?", I say there's only one way--cancel the account--that's it. Because once you have a credit card, you can't possibly trust that every place that you use it, that the waiter or waitress, or the salesclerk at the point of purchase--or the point of sale, is going to be responsible with that card, or they're not going to steal it. So really, there's no way to protect your credit card information. The only real way to respond to credit card fraud, is by paying close attention to your credit card statements, and making sure that you're refuting any unauthorized charges, within a sixty day period of time. As long as you refute those charges within two billing cycles, generally you are going to be in pretty good shape, and those charges will be taken off your credit card statements.
How do identity thieves steal information from retailers and other businesses?
When you are making a debit or credit card transaction at any retailer, that retailer is responsible or they're supposed to be responsible for protecting your information. Unfortunately, many retailers actually store that data for a period of time. Sometimes they may make it accessible to hackers if they have not properly protected their networks. Whether they have a wireless connection that's not secured, they have improperly or nonavailable firewalls, or they simply have someone on the inside that may actually be installing some type of virus or spyware that monitors all transactions, allowing hackers remote access to your information. So it's very important that when you're doing business with any type of a retailer, you check in with them to find out what type of security they have in place.
