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The Center for Financial, Legal & Tax Planning,
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Articles ·
Fuel
Problems Mean Tax Benefits (09-05) ·
Identity Theft: The
New Financial Nightmare (08-05) ·
Maximizing
Your Business (05-05) ·
LLC, S CORP., & C
CORP.: WHAT’S THE DIFFERENCE? (05-03) ·
American
Jobs Creation Act: Explanation and Strategies (04-12) ·
Conditions
Favorable: Consider Selling Your Business Now (04-12) ·
EXIT PLANS: HAVING ONE IS
ALWAYS IMPORTANT (04-11) ·
Is There “Value”
in a “Valuation”? Part 2 (04-08) |
Identity Theft: The New Financial
Nightmare By: Bart A.
Basi and Marcus S. Renwick
Introduction The
incidence of identity theft is nearly doubling each year. Access to information, credit through
machines and anonymous sources had lead to this new financial problem. Often the effects of identity theft are
devastating on the victim. The victim
cannot get credit, will receive countless phone calls until late hours of the
night, and will have their entire financial lives turned upside down for
possible years. Identity theft is
often frustrating and difficult to deal with.
Not only can it cause years of frustration, it can cost valuable time
and money. The best way to deal with
identity theft is total preventative measures before it starts; there are
also ways to fight back once it has begun.
This article will discuss what all consumers, taxpayers and businesses
should do to guard their financial lives and make sure they do not become
victim to this ever growing trend. Prevention Prevention
can best be described in four words: Protect, View,
Hide, and Destroy. If you can remember
these four simple words, you can prevent identity theft from happening to you
and your clients. PROTECT
your information and identity.
Identity thieves not only access your information through machines,
they can also access your information through means as simple as your trash
can or mailbox. Accordingly, make sure
you prevent identity thieves form gathering or viewing your information
before it even comes into your hands. Obviously
when it comes to your computer and telephone, be safe! Never give out your computer passwords,
credit card numbers, social security number, address or any private
information about yourself to an unsolicited email. Currently there are millions of spam emails
being sent out trying to get people to give out information to identity
thieves. Often identity thieves will
send emails offering great products at to-good-to-be-true prices just to get
your credit card numbers. They can
also send emails pretending to be from the social security office needing to
verify your social security number.
Scam artists will use any method possible to get your identity from
you. So, be careful with your
information! |
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Another
place you should protect is your mailbox.
It is always best to have a post office box or locked mail box. However, if you have a mailbox, be sure to
never leave any mail in your mailbox overnight. The mailbox is an extremely easy target for
thieves. Not only can they get credit
card information, but they can possibly obtain social security numbers as
well. If you have any accounts using
your social security number as an identifier, ask if that number can be
changed. Children
and parents can also be an information leak.
Educate your children and parents to avoid them from inadvertently
handing information to anyone. Often
children and parents know substantially more about you and have greater
access to your records than anyone else.
Therefore, they can be an inadvertent threat. Educate them to never hand out numbers,
files on credit card numbers, to anyone. Secondly,
VIEW your information in a private manner.
Low tech thieves have come up with ingenious ways to view your
information alongside you to have access to it. Sometimes looking over your shoulder when
you have information opened on your computer, when you swipe your credit card
through a machine, listen in when you read a credit card number or social
security number over the line, etc. can be a simple way to obtain your data. Always
view and speak your information in private.
Locate your computer away from public viewing areas and windows. Also keep your machine off when not in use. Do not walk away from your computer when
you have a critical document open.
Also, use passwords and screensavers which demand passwords to regain
access to your documents. This is an
inexpensive and easy way to guard your data when you view it. When
using a credit card, be careful when you display it. Telephones can take high resolution photos
now. If you see someone with a phone
around you, be sure to cover your credit and social security cards when using
them. Even if you don’t see telephones
around, still cover your numbers when the card is out and never leave it in a
public area. Next,
HIDE your information. No, I don’t
mean under the couch. Keep all
critical documents and cards in a secured location after and between viewing
them. No system of hiding is fool
proof, but naming computer files something other than “ALL THE INFORMATION YOU’LL
EVER WANT TO KNOW ABOUT ME AND MY CUSTOEMRS” or “MY CREDIT REPORT”, is a good
start. Name the files something you
would know to look under, such as your dogs name or something else
nonspecific to a thief. Keep
paper documents under lock and key. Often in a break in, your identity is more
valuable than anything else in your house.
Just think if a thief were to get a hold of your credit card
statements, your credit report, your bank books, etc.. All of a sudden, a television purchased 10
years ago doesn’t seem like much of a loss when compared to losing all of
your or your customer’s financial data.
Therefore, it is well worth your time to spend time hiding and locking
your identity and information. Next
and last, DESTROY your information.
Just because you threw the information out, does not mean that thieves
are no longer interested in it. Trash cans can be a gold mine to thieves when it comes to
robbing you of your valuables. Credit
card statements, social security statements, bank statements, customer files,
etc can all be very valuable to a thief.
Therefore, invest in a shredder! Strip type shredders are really
insufficient for the job. Invest in a
cross hatch shredder which makes the shreds tiny. This is because thieves will invest the
time to put papers back together. As
an example, run one sheet of paper through a strip type shedder and then
remove the paper. It should take you
no longer than one minute to patch together a document you just
shredded! Now, on the other hand, send
a document through a cross hatch shredder.
Try to put that document back together. If it is even possible, it will take
probably nearly an hour or two to recreate the document into a legible
format. Therefore go with a cross
hatch shredder. For
computer files, be sure to know where the information is and destroy it as
you no longer need it. But wait,
there’s more. When you are done with
the computer, destroy all of the information on the hard drive. Just because your
1997 Packard It
is easy to prevent identity theft. Just
be sure to religiously Protect, View, Hide, and Destroy your vital
information. Though this is not an all
inclusive list of tactics, these are very useful strategies in preventing
identity theft. How To
Determine If Your Identity Has Been Stolen Two
words will guide you here. They are Seek and Watch. SEEK - One thing many people neglect
to do is to monitor their credit report.
Credit reports are available either online or through the mail with
the three major reporting bureaus.
They can be provided to you once a year at no cost to you. Even if you do not suspect identity theft,
it is a good idea to get and view your credit report each year. In doing so, you can check to see if anyone
else is using your social security number and you can have erroneous items
removed. The
second thing to do is to WATCH for
any suspicious activity. Do you
receive your bills late? Are there any
erroneous or fraudulent charges on your credit card? Are your bills coming at all? Do you have excellent credit, but get
denied credit? Has the IRS stated that
your income is higher than what you reported?
If so, it is possible and even likely that your identity has been
stolen or contains substantial errors.
If any of this happens it is time to get on the ball and seek out the
problem. It could be an error, but it
is better to be safe than sorry. What To
Do If Your Identity Is Stolen Two words – Report
and Counter First,
once you have established your identity has been stolen, REPORT it immediately.
Don’t let a thief enjoy the fruits of your labor and make your life
miserable. First, contact all of your
credit card companies. The credit card
companies will know what to do. Also,
have them send you a credit card statement so you can determine what is
correct and what is not. Then, contact
all three credit bureaus and have a security hold placed on your
account. Then, contact the local
police and Federal Trade Commission.
In the event you received information through the Internal Revenue
Service, contact them and explain your story.
These organizations will aide you in stopping the thief from getting
any further. Next,
COUNTER. Once you receive your credit card
statements and reported the incident, get your side of the story out to all
interested parties. Tell them what
happened, what is correct, and what is a stolen item. Doing this will not be easy, but if you
want your credit back, you must. You
should expect credit card companies, collection agents, and attorneys to
contact you threatening to collect the debt.
Always be patient with them.
Tell them your identity was stolen and that you are working to remedy
the process. It may be wise to hire an
attorney to represent you during this difficult time. Though an attorney cannot waive a magic
wand, an attorney can be someone in your corner who knows how to deal with
this situation best and prevent it form recurring. Conclusion Identity theft is an unfortunate fact of life in |
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The
Center for Financial, Legal and Tax Planning, Inc. |
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