I’ve seen it before – a consumer who wants to get a mortgage loan to purchase a house or even refinance sits down with me to get started, but once we pull their credit, a look of shock hits their face; they’ve been the victim of financial fraud or identity theft.
In fact, these are fastest growing forms of crime, and about 1 in 8 people in the U.S. will have their sensitive financial information or private data compromised this year. Once that happens, their bank accounts, credit cards, tax refunds, social security, and just about every financial instrument in their life is vulnerable.
Luckily, there are some basic things we can do to keep our finances safe:
Your mailbox may be vulnerable if its unlocked, unsecured, and especially sitting out by the street. Make sure that you get a private, locking mailbox that’s impossible for someone to reach into. To further protect your financial data from ID thieves, you can opt out of all unsolicited credit card or insurance offers just by calling 1-888-567-8688 or going to optoutprescreen.com.
Your garbage may be a great place for ID thieves to go shopping. While we think of it as refuse, most peoples’ trash is filled with receipts, old bills, account statements for credit cards, mortgages, etc., not to mention every shred of your identity like name, address, and account numbers. The easy solution is to properly shred any financial paperwork, mail, or just about anything that’s paper before tossing it out. These days, it’s even important to rip up labels on prescription medications!
What’s in YOUR wallet? Well, identity thieves and financial hackers would sure like to know, and they have the keys to the kingdom the moment they find (or steal/pickpocket, etc.) your wallet or purse. Don’t carry ALL of your ATM or credit cards in one place, and definitely don’t keep your Social Security card, passport, birth certificate, or other important documents on your purse – lock those extras up in a safety deposit box or safe at home.
It’s hard to protect debit cards and credit cards since we use them so much these days, and there’s no other way than to hand it to someone in a store and hope for the best. However, you can choose to use your cards only at legitimate locations and pay cash elsewhere. When in doubt, always use your credit card because it offers much more protection against fraudulent charges, and then you can just pay off the balance every month.
Likewise, use an established credit card for online purchases, don’t opt to have them save your credit card information on file (the small convenience isn’t worth the security risk), and never use a debit card for online purchases with anything but the most trusted sites.
One of the fastest growing methods for criminals to access your financial data is through phone scams. They simply call up (especially targeting seniors and people who speak English as a second language) and pretend to be someone of authority, like from your bank, credit card company, mortgage company, the Social Security Administration, IRS, or even your town hall.
Then, they are very slick at asking the right questions to get sensitive financial and other information from you. Or, some scams are so blatant that they request a payment ASAP – which people fall for all the time! NEVER talk to someone over the phone if they’ve called you; call their number back to confirm and make sure it’s legit.
The rise of online shopping has opened the floodgate for ID theft and financial hacking, as criminals can now operate anonymously, safely, and far away – probably even in a different country – as they attempt to steal the information that you’re volunteering online. Of course, no one wants to give up shopping online, but only use reputable websites that have high- security protocols, such as Amazon, Walmart, eBay, etc. You should also use a third-party payment processor to make purchases (like PayPal) or, even better, use a credit card with great theft protection.
Likewise, NEVER enter your financial or identity information into a website that only starts with “http”– not “https”. You can also look for the padlock icon in the address bar or at the bottom of your browser to verify if the site is safe (but not just on the site itself, as it can easily be copied.)
The first line of defense on all your online activity is the password you set, so give them a safety upgrade. Set strong passwords that include numbers, letters, and characters, and NEVER use your own personal information like date of birth, the year, your children’s names, etc.
Do the same for your social media accounts and don’t EVER post sensitive information about your address, documents, financial accounts, work, school, or vacation schedule etc. on social media. It seems like common sense, but you’d be surprise how much people reveal about their finances and private lives on social media!
Likewise, make sure your computer, smartphone, and any electronic devices are secured, each with a different password. Get a good anti-virus software that protects you from malware, spam, etc. It also goes without saying (but people still do it!) that you should NEVER sign into your financial accounts, make payments online, etc. on public Wi-Fi networks.
Finally, the best way to protect yourself from data hackers and financial ID thieves is to check your statements and accounts regularly. As we suggested, use one major credit card for all your online and daily purchases, and then check the account activity every couple of days online to make sure there is no misuse or sketchy charges.
For the same reason, you should check your credit report regularly – you can access a copy of your credit report once a year from each of the three credit bureaus, which adds up to looking at one statement every four months. These days, it’s also a good idea to consider an Identity Theft Protection or monitoring service to keep your credit safe.