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ID Theft Guide
To protect yourself from becoming a victim:
Don't carry a checkbook. Pay by cash or credit card.
Don't carry your Social Security card with you or use your Social Security number as your driver's license number.
Buy a paper shredder. Shred any documents listing your social security number and other financial information such as your bank account numbers and credit card numbers. This is the number one way of preventing identity theft.
If someone is using your identity and cashing your checks or credit cards, you should: Report the situation immediately to your bank or credit card company. You may not have monetary liability because forgery and/or fraud is involved, but you will want the companies to be aware of the problem, as this is something that could affect your credit. In addition, follow these instructions to fully protect yourself:
a) Contact all three credit bureaus and issue a fraud alert. Check your credit report six months later and look for items you don't recognize. b) Provide a copy of your driver's license to each agency's fraud unit in order to register an affidavit. c) Contact the proper authorities in writing, via certified receipt request. d) Inform your local police department, Social Security Administration and all creditors with whom you have accounts.
If a thief steals your identity and begins racking up debt: A) Contact the fraud units of the three credit reporting agencies. Request that your account be flagged and add a victim's statement saying, "MY ID has been used to fraudulently apply for credit. Call me at this number to verify all applications." Find out how long the fraud alert will be posted and how to extend it if you need to. Check your credit report and look for items you don't recognize.
B) Contact your credit card companies and financial institutions to report the fraud. Get new cards, have old accounts colsed with a memo stating, "account closed at customer's request." Follow up in writing.
C) Call the police and get the crime on record, then get a copy of the police report. Keep a log of all conversations including date, name, phone number, and the information provided.
D) Notify the Federal Trade Commission, which keeps a database of identity thefts. Phone: (888) FTC-HELP; Address: FTC, CRC-40, Washington D.C. 20580.
E) Notify you bank and if necessary, cancel checking and savings accounts and get new account numbers. Request a password that may be used in every transaction. Get a new ATM card, account number and password. Don't use your SS # or birthdate as a password.
F) Don't pay any bill or part of a bill resulting from identity theft.
Experian and TransUnion now allow residents of all 50 states to freeze their credit online. With Experian, it takes about 90 seconds. With TransUnion, 3 minutes. Want to find out how to do it? Follow the bolded links on Clark's guide!
So what's going on with Equifax? Currently, only residents of 4 states -- Georgia, Iowa, New Jersey and Wyoming -- can freeze their credit online. Those are the 4 states that are required by law to allow their residents the online option. But by Nov. 1, Equifax expects to make the online option available to residents of all other states too.
Please note that while a credit freeze can help shut down economic ID theft, it will not help eliminate criminal identity theft. That's where crooks use a fake ID with your information.
In order to tackle criminal identity theft, local law enforcement will have to move to electronic fingerprinting and/or iris reading to make sure a suspect is who he or she claims to be.
Little by little, we are getting the tools we need to stop ID theft. It's only been more than a decade coming! Clark recalls that it all started with a couple named the Foleys in San Diego who founded the ID Theft Resource Center after it happened to them.
Syndicated financial writer Kathleen Pender has calculated that 65 million Americans are paying for credit monitoring or fraud alert services right now. That's about 1 in 4 adults!
These "services" can cost you from $6 to $15 per month. They're marketed very effectively on radio, TV and the Internet and try to play on your fear.
But the real problem is that fraud alerts are routinely ignored. And with credit monitoring, you'll only learn after the fact if unauthorized lines of credit are opened in your name.
In reality, there's only one effective way to prevent criminals from using your credit to make purchases. It's called a credit freeze and Clark has prepared a guide to help you navigate the process of applying for one.
With a credit freeze, you shut down a criminal's ability to do anything with your info -- even if it should be compromised. That's because you get a secret code that only you know.
The one-time cost of a credit freeze varies by state from free to $10 per credit bureau. Compare that to a monthly fee for monitoring or reporting! Should you have to apply for new credit, you'll need to "thaw" your records. Again, the cost will be from zero to $10 per bureau.
Many talk-show hosts are currently doing spots for one popular credit monitoring/fraud alert service called LifeLock. While this is a legitimate company, Clark wants to emphasize that you shouldn't waste your money.
Our senior producer Kim froze her credit with all 3 bureaus. She used the info contained in Clark's guide and found the whole process only took her about an hour. It's all been very painless so far; she didn't even need to thaw her credit when she opened a new checking account or switched her auto insurance.
The latest Internet Security Threat Report shows that the value of stolen info has declined as the crime of ID theft spikes. Who knew that supply and demand even drove prices in the criminal underworld?!
A stolen credit card number now nets a measly 40 cents! That sum used to be at least several dollars higher. Your bank account number now goes for about $10. And get this -- your entire identity (credit card number, Social Security number, name, address and date of birth) now goes for just $2! Stolen info is that prevalent; in just the first 90 days of 2008, more than 8 million people had their data breached.
Business owners face an added burden when it comes to certain kinds of ID theft. Under the Uniform Commercial Code, they may be held partly or totally responsible if their own credit card or business checking account number is used for phony charges. Consumers would be protected under the same circumstances, but not so with businesses. So it's imperative to keep your check book locked up at the office if you're a business owner.
For consumers, be sure to monitor your credit card statements closely. You have 60 days to dispute any fraudulent charges. And consider freezing your credit. It's the best preventative medicine you can take.
Both sides of the aisle are advocating the idea of a gas tax holiday this summer. Yet Clark thinks this is one of the craziest economic ideas he's heard recently. We're all hurting as we watch the dollars fly and the gallons crawl at the pump. But the gas tax holiday is a recipe for financial disaster. It would increase demand and ultimately drive up prices.
Brazil is one country that's made some smart decisions in the energy realm. The South American nation was even more dependent on foreign oil than we were during the last energy crisis in 1979. So they embarked on a program of energy independence using sugar. Our Brazilian allies now provide for 100% of their energy needs and can export additional sugar as well.
Sugar produces a fuel that's more efficient than the corn-based ethanol we use. So why aren't we getting Brazil's exports? Domestic sugar producers have gotten Congress to put up trade barriers to keep it out of the marketplace. Meanwhile, our farmers have turned to growing their corn crop for fuel use, not for food. That, of course, further drives up the price of food!
We continue to use foreign oil from those who want to destroy us, instead of using sugar from our allies in Brazil. It makes no sense to Clark.
