May 25, 2021
A new study reveals that nearly half of all Americans have been victims of identity theft. Here are the top 10 ways you can protect yourself.
In the year 2020, the Consumer Sentinel Network of the Federal Trade Commission (FTC) received almost 1.4 million identity-theft complaints—an increase of 113% over 2019.
The most common types of identity theft involved criminals taking over people’s government benefits, opening up credit-card accounts, and getting fraudulent loans and leases. The average amount of money lost per victim each year to identity theft estimates from $300 to nearly $1,500.
In addition, the FTC says that these are the top four most common ways that identities are stolen:
1. Company computer hacking. Today’s primary means of identity theft. Although there are still many attacks on individuals, hackers have found that breaking into the computer systems of companies and their vendors can be extremely profitable.
2. Wallet or purse theft. Thieves use this as an opportunity to take extra cash or credit cards along with your license to take your identity.
3. Theft of a computer, phone, or tablet. This theft is acquired by using spyware and other technology to get personal and private information.
4. Document theft. Some may rummage through your trash or mailbox to get private documents.
The good news? You can avoid being a victim. Here are the top 10 strategies you can use to protect yourself and your family from the financial loss and inconvenience of identity theft:
1. Safeguard your online personal information.
Most people use personal data to perform many online tasks every day, such as accessing bank and credit-card accounts, emailing, visiting social media sites, and more. But as recent increases in corporate and government data breaches have revealed, your online personal data is not always completely secure.
- Don't post personal information—such as your birthdate—on an online profile or a social media website.
- Don't open or download e-mails, files, or documents from people or companies you don’t recognize. For example, the U.S. Internal Revenue Service (IRS) never contacts taxpayers by email, text, or social media. If you get an email or text that appears to be from the IRS, either delete it or email it to the IRS at email@example.com for investigation.
- Use virus-protection software on all of your internet-access devices (computers, tablets, phones, etc.) and keep it up-to-date.
2. Use secret passwords and change them regularly.
Yes, it’s annoying to have to use passwords for everything online. But experts say that a hard-to-guess password is one of the best ways to safeguard your personal information. So when you create a password:
- Mix it up. Use number, letter, and character combinations that can’t be easily guessed. The FBI recommends at least 15 characters.
- Avoid the obvious. Don’t use obvious passwords like “12345678,” “qwerty,” family-member names, any part of your Social Security number, birth years and birthdates, or other personal data.
- Don’t recycle. Set up a unique password for every online site you visit that requires a password.
- Keep everything secret. Don’t casually share your passwords with anyone. And don’t write them down on a sticky note that you keep on your computer monitor or inside your desk drawer.
- Follow company rules. If you work for a company, be sure to follow their online security policy.
- Check and verify. Check your passwords to find out if they’ve been compromised. For example, Google offers a free password checkup tool that can show you which of your online accounts have weak or compromised passwords. You can also visit HaveIBeenPwned.com to find out if your email or phone number has ever been compromised in an online data breach.
- Use a password manager. Managing multiple passwords can be difficult, so you may want to use a password-management software package or app to keep everything straight. Refer to this helpful article on ZDNet.com about password-management software.
3. Secure your personal papers.
Dumpster diving is a low-tech, old-fashioned way to steal personal info, but criminals still do it. Make sure your personal papers are well managed, especially if you have roommates or relatives living with you—or if you employ outside help such as housecleaners or caregivers:
- Manage your mailbox. Empty your mailbox as soon as possible after your mail arrives. Some may use a P.O. box at their local post office for more security. And don’t mail anything from home that has a check in it—criminals can snatch mail from your mailbox and use solvents to erase what you’ve written on your check. Instead, mail checks from your local post office or public mailbox—or switch to an online bill-pay system. Thieves can also reroute your mail by submitting change-of-address requests in your name, so keep track of expected mail that doesn't arrive. And when you travel, ask your post office to put your mail on hold while you're away. Be sure to keep all important papers, statements, letters, and tax-related items in a secure place, such as a locked box or a home safe.
- Destroy unneeded papers. Shred (or thoroughly tear up) direct-mail offers including:
- old billing statements
- credit offers or applications
- outdated insurance documents
- medical statements
- credit-card receipts
- checks and bank statements
- canceled or expired credit and debit cards
- other unneeded materials that contain personal data
- Keep records out of sight. Are people working in your homes—such as babysitters, house-cleaners, or tradesmen? Make sure your financial papers, credit cards, and other bits of personal information are all locked away.
- Mind your receipts. Don’t leave credit-card, debit-card, or ATM receipts behind when you shop or eat out, and never throw them away in public. Instead, bring them home and shred them.
4. Don’t let credit or debit cards out of your sight.
If you have to hand a credit or debit card to a store clerk, keep your eye on it. They should do nothing more than run your card through a standard card reader. If the person tries to step away or into another room with your card in hand, stop them and tell them to return it immediately.
5. Know who you’re talking with on the phone.
Don't give out personal information by phone unless it’s absolutely necessary, and don't ever share your information unless you initiated the call:
- Make sure it’s a legitimate call. If someone calls you asking for private identity or financial information, don’t give them any information and don’t confirm any information they say they have. Instead, ask who the person is, what company they work for, and the reason for the call. If you think the request is legitimate, get a call-back number and hang up. Important note: The IRS never makes initial contact with a taxpayer by phone. If you get a cold call that claims to be the IRS asking for personal or financial information, hang up.
- Confirm the call-back number. Check online to confirm that the call-back number the person gave you is legitimate. Then call the company back and conduct your business.
6. Defend your personal information.
Take an active role in protecting your personal information:
- Never carry your Social Security card, and don’t carry any other card or paper that has your Social Security number on it. Your Social Security number is a prime target for identity thieves because your number gives them easy access to your credit reports and bank accounts
- Ask if sensitive personal information is really necessary. If salespeople or order-takers ask for your Social Security or driver’s license number, challenge that request. Ask them if such information is absolutely necessary. If it really is, tell them that you do not allow them to share that information with other persons or companies.
- Limit what you carry in your purse or wallet. Take along only the information you really need, such as your ID card or driver’s license and the credit or debit cards you normally use. Keep other personal information and cards you don’t normally use tucked away securely at home.
7. Monitor your credit report.
Every year you should thoroughly review your credit reports from the top three credit reporting bureaus: Equifax, TransUnion, and Experian. You can get free copies from all three companies by visiting Annualcreditreport.com or by calling (toll-free) 877-322-8228—and it won’t affect your credit score. If you find anything that’s inaccurate or suspicious, contact the appropriate creditor immediately. In addition, all three credit bureaus provide tools to help you monitor your credit, such as email and text alerts that can notify you of significant changes.
8. Review your credit card and bank statements.
It's important to regularly review your credit card and bank statements because someone who has stolen your credit card number or bank account information could make small charges to see if they can get away with it:
- Watch for anything strange. Make sure you recognize the companies, locations, and purchases listed on your statement—no matter how small.
- Know when to expect your statements. Get familiar with when your statements normally come and follow up with the appropriate company if you don't receive your statement on schedule.
- Consider closing unneeded accounts. If you have credit cards that you don’t need or use, consider closing those accounts.
9. Be careful when you’re away from home.
Whenever you leave home, make sure to protect your personal information at all times:
- Defend your purse or wallet. if you carry a purse to the grocery store, latch it in place in your grocery cart using the cart’s child safety strap. Also, never walk away from any cart that has your purse in it—not even for a second. And don’t make it easy for a pickpocket: Never carry a wallet that doesn’t fit completely inside your purse or pocket.
- Leave sensitive items at home. If you take a trip, leave your checkbook, Social Security card, and other sensitive items in a safe place at home.
- Secure your devices. If you carry a laptop, smartphone, or other device(s), make sure you have eyes on them at all times. For example, never leave a computer or tablet in your hotel room unless it’s locked in the hotel room safe. Also, make sure all of your devices are password-protected and have the latest Internet security software installed.
- Delete your history. Be sure to delete your online history after using a public computer.
10. What if you're a victim?
If you believe your identity has been stolen, take these steps:
- File a report with the FTC. Visit the FTC at identitytheft.gov, or you can call the FTC toll-free at 877-438-4338 (or via TDD at 866-653-4261). The FTC collects reports about identity-theft cases nationwide. Although they don’t chase down criminals, their information is used by law enforcement agencies (such as the FBI). When you file your report, the FTC will help you create and implement a free, customized, personal recovery plan that includes pre-filled letters and forms that you can use to file a police report or dispute fraudulent charges.
- File a local police report. The police report helps protect you by creating a paper trail that documents what happened. For example, your report could be very useful if someone uses your information to commit a crime. And while your local police can’t help you if your identity was stolen by out-of-state or overseas criminals, they may be able to use your report to catch a local thief.
- Place a fraud alert on your credit reports. Contact either Experian, Equifax, or TransUnion, and place a fraud alert on your account. The alert is free, and it will stay active for one year, notifying any company that pulls your credit report to look very closely at the person applying for credit in your name—because your identity may have been compromised. You only need to request a fraud alert from one of the credit bureaus; that company will notify the other two.
- Monitor bank and credit card statements. Contact your bank or credit card company right away if you spot any charges or transactions that you don’t recognize or didn’t authorize.
Get help if you need it. Identity theft can be time-consuming, discouraging, expensive, and complicated to resolve—which is why you need to do whatever you can to avoid it. But if your identity has been stolen, you may need help to get your finances back in order, correct your credit reports, or deal with debt collectors. If so, you may want to meet with an attorney who specializes in identity theft or consumer fraud. There are several online directories you can use to help find a reputable consumer-fraud attorney, including Avvo, FindLaw, LegalMatch, and NOLO. You can search by location and area of practice, and some sites even provide attorney reviews.