At a breakfast meeting in the Fish-Kebab restaurant Tuesday, March 9, Deputy Commissioner of the Nassau County Department of Consumer Affairs James W. Reed briefed the Port Washington Chamber of Commerce on the fastest growing crime in the United States, identity theft. Reed highlighted some of the more common methods used in identity theft and offered several ways to prevent it.
Identity theft occurs when someone uses your financial information to apply for additional credit, make unauthorized purchases, gain access to your bank accounts or obtain loans under your name. Unfortunately, most people do not realize they have been victims of identity theft until the mysterious charges appear on their credit card or they are rejected for financing because unpaid bills appear on their credit report. Identity theft costs corporations $48 billion annually; losses to individuals account for over $5 billion.
The most common scheme used in 41 percent of identity theft against individuals involves the theft of mail. A recent case in Valley Stream involved thieves following the postman on their rounds to steal documents such as credit card statements. Credit card statements often have a simple check-off box, which is normally used for a change of address. This feature could be used by thieves to direct future billing to their site where they could make application for additional cards and credit. Reed cautioned Chamber members to make sure mail arrives on time and suggested calling the port office if it arrives late. Leaving outgoing mail in the letterbox for pickup by the postman can be especially hazardous if that mail contains a check bearing your account and routing number, which can be used for illegal fund transfers. Use a shredder on all documents containing critical financial data.
A number of helpful suggestions were made concerning safe methods to handle credit card purchases. Consumers should keep credit card receipts and compare them with periodic statements using a line-by-line scrutiny. Debit cards are especially dangerous since they provide direct access to the consumer's cash. Skimmers are small handheld devices from which personal data can be retrieved after a credit card is given to a waiter or clerk. Card users should be alert to business personnel who take an unusually long time to prepare credit card check slips or disappear from public view.
Outsourced billing companies servicing doctors and similar professions where the staff consists of low-paid employees are prone to identity theft. Professionals who fraudulently use credit cards will often pay a finder's fee of $75 to $100 to those who capture identity information. Credit card-like hotel room keys are also liable to contain sensitive personal data and negations are now taking place with the hotel industry to restrict this data. Pre-approved credit card offers bearing sensitive personal information may place the consumer in jeopardy. The Nassau County Department of Consumers has prepared a form, which can be used to exclude consumers from solicitations by the major credit card companies offering pre-approved credit cards.
Although there are no guaranteed methods to prevent identity theft, Consumer Affairs recommends: 1) Carry only the credit cards you actually need; 2) Do not carry a Social Security card or papers identifying your number unless necessary; 3) Cut up old or expired credit cards and close inactive bank accounts; 4) Chose PIN numbers which have no relationship to other important numbers you have; 5) Memorize your PIN; don't write it down; 6) Safeguard personal information; 7) Give your Social Security number only when absolutely necessary; 8) Know who you're dealing with when communicating on the phone, by mail or the Internet; 9) Compare ATM receipts and cashed checks with bank statements; 10) Shred unneeded financial statements; 11) reduce unsolicited credit card applications you receive; 12) Learn the privacy guidelines of your financial institutions; 13) Request credit reports from the three major credit reporting agencies at least once per year (Equifax-800-525-6285, Experian 888-397-3742, TransUnion 800-680-7289) 14) Track credit card billing cycles; 15) If victimized, file a police report.
In general, there are several things to do in dealing with credit card companies to decrease the risk of identity theft. Consumers are urged to keep down their credit limits. The higher they are, the more likely you'll be targeted by thieves. Some companies will accept your wish to deny approvals if they exceed a certain amount, contact you by cell phone and record your being out of town on vacation. It may be wise to ask for a fraud alert on your account whereby you'll be notified should an inquiry be made on your credit standing. Finally, cancellation of credit cards should be followed up with a letter to the company.
The Federal Trade Commission is the nationwide clearinghouse for identity theft complaints and may be contacted at 1-877-IDTHEFT; Nassau Consumer Affairs may also be contacted for advice at 516-571-2600.