Protect Yourself Against ID Theft and Credit Card Scams

Zebert L. BrownIf you’ve paid close attention to the news recently, you’ve probably heard about the millions of medical record accounts that were compromised by hackers at a major medical facility in Alabama and the retail accounts that were hacked by Target stores.  In this digital age, identity theft and consumer scams are fast becoming a big problem for consumers and retailers alike.

According to Javelin Strategies and Research, a leading consulting firm on retail merchant transactions, over 13 million consumers fell victim to identity theft in 2013 at a cost of over $18 billion. Such criminal activity also impacts retailers. According to a report by CyberSource Corp, a leading business-to-business payment processing and risk management consulting firm, retailers lost an estimated $3.5 billion in revenue to online fraud in 2012.

The leading cause of identity theft for consumers continues to be weak password protection to websites that conduct ecommerce transactions. For retailers, the problem goes a lot deeper. Most retail merchants fall victim to malicious software that seek to steal consumer Social Security Numbers, credit card numbers or bank account numbers. The good news here is banks, credit card companies and most major department store retailers take various steps to protect consumers who fall victim to identity theft offering everything from refunds on sales to discounts toward their next purchase and free identity theft protection services.

Consumer scams are a constant problem for shoppers and the scams get more elaborate over time. According to the Better Business Bureau, the top 10 consumer scams for 2013 were:

  • Medical Alert scam

  • Auction Reseller scam

  • Arrest Warrant scam

  • Invisible Home Improvements scam

  • Casting Call scam

  • Foreign Currency scam

  • Scam Texts

  • Do Not Call scams

  • Fake Friend scam

  • Affordable Care Act scam (BBB’s “Scam of the Year”)

So, what can you do to protect yourself from identity theft and prevent being scammed? Here are a few suggestions:

  1. Keep your anti-virus software up-to-date.  The best way to protect your online identity online is to keep your anti-virus software updated.  Most anti-virus programs, including the free versions, allow you to schedule your computer to receive automatic updates on a daily or weekly schedule you set.  But a word to the wise:  Unless you’re using a paid commercial version of anti-virus software, such as, Norton Antivirus or McAfee All-Access, most free versions only provide limited security features.  That doesn’t mean you can’t have decent anti-virus protection using free software.  However, it does mean you may need to utilize a combination of other anti-virus, malware and spyware programs to keep your online presence safe and secure.  One exception to the rule might be Windows 7 and Vista users since Microsoft’s Security Essentials is built into its operating systems.  But in order for its built-in security features to adequately protect your computer and keep your online presence secure, you should keep your anti-virus program up-to-date.  You can do this manually from the Security Essentials’ control panel or you can download the latest security updates using the Windows Update feature from your computer’s Control Panel.

  2. Use strong password encryption. A strong password consists of a combination of upper and lower letters, numbers and symbols (e.g., Ab1$3dC$). When deciding on a password, be creative.  Mix it up alittle.  For example, suppose I wanted to use the word “super cool” as my password. I could use, “souperkool” or “SoupERKoweL”.  I could even add numbers or special characters to strengthen the encryption making it even more difficult for hackers to decipher my password.  Whatever you do, don’t use personal identifiers such as the name of your spouse, child or family pet as your password. And if you’re still using “password” as your password, you should change it now!  I would also recommend changing your password to all Internet-capable devices at least once every 30-60 days.  If you must maintain a list, don’t save it on your computer’s hard drive.  Save it on a USB drive instead and keep it in a secure location, i.e., a locking file cabinet, away from your computer if possible.

  3. Don’t click on unfamiliar links or email attachments. Whether at home or at the office, never open email attachments or click on links from senders you don’t know or websites that are unfamiliar to you.  Keep in mind your bank, mortgage company, utility company or retail department store will never contact your via email seeking confirmation of your personal information. They will either call or send you a letter on company letterhead.  But if you suspect someone may be trying to scam you over the phone, try to get as much information from the caller as you can including the caller’s name, employee ID number, business license number, if possible, and a call-back number.  If the caller hangs up or refuses to provided the requested information, chances are it’s a scam.  Follow-up with the Better Business Bureau or your state’s licensing agency to confirm that the company is who they say they are using the information you obtain. 

  4. Shred personal documents. Destroy outdated documents such as bank statements that are more than 3 years old or unwanted credit card applications.  You can purchase a shredder at most retail department store for under $50.  An alternative to shredding your documents would be to rip them up in small pieces and dispose of the pieces in multiple trash cans to make it more difficult to scammers to look through your trash and find such unused documents.  As a last resort, you could burn such documents.

  5. Use browser security features. Internet Explorer, FireFox and Chrome all provide “InPrivate Browsing” to keep websites from tracking the websites you last visited.  Never set your website to automatically save your passwords.  This may be a convenient way to quickly log back into a website your frequent, but it’s also an easy way for hackers to obtain your password using keystroke tracking malware.

  6. Report suspected activity immediately. Monitor your bank and credit card statements frequently (online if possible) and contact your bank or credit card company as soon as possible if you notice questionable activity on your accounts.  If you suspect you’ve been scammed, you should contact the Better Business Bureau and report any information you can recall or present any correspondence or solicitations you suspect may be a scam.

That’s my blogpost for this week.  Post your comments below to join the discussion. And don’t forget to tune in next week where I’ll once again share more ways you can break the debt cycle and then go…beyond.

Zebert L. Brown is the author of Break the Debt Cycle in 3 Simple Steps and a 16 year Navy veteran with specialties in administrative management, career development and public relations. Follow him on Facebook and Twitter.