Have you become a victim of identity theft or identity fraud? If so, you are not alone; nearly 1 in 10 Americans have felt the stab of identity victimization. Even if you are fortunate enough to have escaped the first-hand knowledge of the consequences of having your bank accounts ripped off and your social security number compromised, you should still be concerned.
Identity theft and fraud is big business both at home and abroad. If it was to be compared to legitimate business enterprises, you would rank it right up there with Microsoft and Amazon. Identity theft is responsible for the ill-gotten transfer of monies from big corporations to the hands of small and big time crooks in the amount of $31 billion annually, and that’s just fraud scams that affect US companies. If international business losses are taken into account as well, the number jumps up to over $221 billion dollars.
If you dismiss these huge numbers, as many consumers are apt to do, you could be setting yourself up for a huge mess. It is a very common mindset to waive aside catastrophic business losses because business is business and it doesn’t really affect individuals. Consider this: businesses pass their losses directly on to the consumer. This drives up the cost of everything from microchips to potato chips, and you are personally footing the bill.
Beyond inflating the costs of goods and services, identity theft has the potential to become a very personal crime as well. It is estimated that about 10% of the US population has had their personal identity raided with an average loss of $1,620. Not many households could easily afford to lose over $1,500 and not feel the sting!
Believe it or not, the actual loss of money is not the biggest problem caused by identity theft. That raided account, maxed out credit card, or abused social security number leaves a trail burrowing deep into your credit history negatively impacting your credit score (identity theft criminals are not known for paying their fraudulent bills in a timely manner which leaves you holding the bag you probably don’t even know about). One of the most common ways identity theft is discovered is the denial of new credit applications. This means your credit score has already taken a dive before you ever even know it was in jeopardy.
Prevention is, of course, the best defense against ID theft, unless you like the idea of spending the next 330 hours changing banks and closing credit card accounts then arguing with creditors, and Transunion in an effort to get your money and credit scores restored. To prevent ID theft, you need to employ three easy, but powerful tools.
First, be safe online. Only a very small percent of ID theft scams (11%) originate from an online source, but thieves can access bank or other credit account information as well as personal information from an unprotected computer. Getting an anti-virus program installed, keeping it current, and performing regular scans will block attempts to steal information from your PC.
Second, protect your mail! Get a lock on your mailbox and pick up your mail daily. 43% of all ID fraud starts from unwanted eyes getting a lock on your paperwork. To be extra safe, you need to shred mail, including junk mail credit card offers, as well as account statements and any other paperwork before discarding it.
Third, keep your wallet guarded. A stolen wallet is a big deal because of all the hours it takes to replace the important papers within. Avoiding the trip to the DMV to replace your driver’s license alone is worth any extra effort on your part to protect your wallet. Don’t carry anything extra in your wallet either; leave credit cards at home as often as possible and never carry your social security card with you.
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