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BAM Intelligence

Protecting Your Family Against Identity Theft

Have you or a member of your family ever had your credit card information stolen? Have you ever worried that your personal financial data was somewhere on the Internet, up for grabs to the highest bidder? Would you know what to do, or what steps to take, if you suspected that you were a victim of identity theft?

Several weeks ago, I received a call from my daughter. She told me our joint credit card had been hacked and there was a fraudulent charge on it. My first thought was that this all-to-frequently happens in today’s world. I anticipated our credit card company would do a fraud report, send new cards and we would not be responsible for the fraudulent activity.

What made this situation a little scarier, however, was that in addition to a fraudulent charge on my daughter’s card, someone had gone into her online account with the credit card company and changed her address and login information. The bank had no idea how this happened and neither did we, though our worry was that her identity had been stolen. So my daughter filed a report with the bank, a police report and a report with the Federal Trade Commission. This took a lot of time, but it also made her feel safer and taught us both some life lessons along the way.

The following weekend, my daughter went online to check her credit reports. She found that her address had been changed to a location in Philadelphia (we live in the Buffalo, New York area). This was exactly what had happened with her credit card. My imagination started to run wild. I was picturing some cybergeek, sitting in his boxers in an apartment in Philadelphia, using his smarts to no good end. As a dad, I felt helpless, scared and angry over the unfairness of it all. Who would do this to a college student weeks away from graduation and looking to start building her life?

It seems like every day that we read about payment cards being compromised. In 2014, Home Depot, the do-it-yourself hardware retailer, revealed that a data heist affected 56 million payment cards. That incident appears to have been even bigger than Target’s breach in 2013. The most recent data breaches haven’t been limited to occasions where only payment card information was stolen. So far this year, employment, financial or other personal data was taken in major data breaches at insurance giant Anthem and the federal government.

While the majority of companies that issue cards will waive any charges associated with fraudulent activity, it’s not just the money that is at issue. It’s the feeling of not being safe. Have you ever had your house broken into? Having your credit card hacked elicits a similar feeling, although with a greater degree of helplessness. I can change the locks on my house, buy a security system or move to a gated community, but what can I do about cyber-attacks and threats to my identity?

Well, there are some steps you can take (steps my daughter recently pursued) to protect your financial information, identity and sense of safety:

  • It all starts with you, take your own financial security seriously.
  • Monitor your paper or online statements. Ask other family members about unusual charges you notice. Also, watch for very small charges because they may be from a fraudster testing your card.
  • Change your passwords frequently. Use letters, symbols and numbers. Gone are the days of the same simple password for all your accounts.
  • Having many passwords means having a place to record them. If you have your passwords in your phone or tablet, look into an app that will secure them.
  • Go online for your free annual credit report (com). This is your only source for credit reports authorized by Federal law. You are allowed one free report annually from each of the three credit agencies.

If you do become a victim of identity theft, or suspect that you are, you can take these additional steps:

  • File a police report.
  • File a report with the Federal Trade Commission (ftc.gov).
  • Contact any one of the big three credit bureaus (Equifax, Experian and TransUnion) to place a 90-day fraud alert on your credit report. If identity thieves try to open a new credit account in your name, prospective lenders who pull your credit report are supposed to see the alert and take steps to better verify the identity of the applicant. You can do this online with any one of the credit bureaus, which will then also notify the other two agencies.
  • As an added step, you can put a freeze on each of your credit reports. Some states allow this at no cost to you if you have been a victim of identity theft. This action hinders fraudsters from using your identity to set up fraudulent accounts. With a freeze, any time a credit check is done, you would need to provide a PIN as an extra security step.

My daughter elected the 90-day fraud alert, which comes with a free credit report 90 days after she requested it, and we experienced firsthand how well it worked. Just this past week, I went with her to the store to set up her own cell phone account.

The cell phone provider does a soft credit check when customers apply for a new cell phone account. We were pleased to see that when this occurred, the application process halted. The representative called their application center and my daughter had to answer three additional security questions. To some, this may have seemed an inconvenience. To my daughter and me, it showed that the steps we took, specifically the 90-day fraud alert, were working.

As we left the store, I smiled at the employee as he apologized for the extra time it took to sign up for a new cell phone. For me, the process could not have gone better. It proved that the steps my daughter had taken to protect herself and her credit (in my mind, the digital equivalent of new locks, an alarm system and a doorman built like a defensive end). My daughter’s financial “house” is more secure than ever as she starts the next phase of her life, and I know that everything will be okay.

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The opinions expressed by featured authors are their own and may not accurately reflect those of the BAM ALLIANCE. This article is for general information only and is not intended to serve as specific financial, accounting or tax advice.

© 2015, The BAM ALLIANCE

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Brian Zdrowak, Insero Wealth Strategies

Advisor, Insero Wealth Strategies

Brian Zdrowak, CPA, CFP® is an investment advisor for Insero Wealth Strategies, an independent member of the BAM ALLIANCE.

Brian Zdrowak joined Insero Wealth Strategies, LLC in 2014 as a Partner, with over seven year’s experience providing financial solutions to individuals, trusts, business and employee benefit plans.

Prior to working for Insero Wealth Strategies, LLC, Brian worked at Dopkins Wealth Management, providing services to clients in the Rochester and Buffalo marketplace. Brian first joined Dopkins & Company, LLP in 2005, working as an auditor and attaining the level of Senior Accountant. In 2007, Brian joined Dopkins Wealth Management, LLC, where he provides financial solutions to individuals, trusts, small business owners and employee benefit plans. Brian obtained a Master of Business Administration and Professional Accounting degree from Canisius College in December 2004. Prior to joining Dopkins, Brian worked for 17 years with a Fortune 500 National marketer and distributor of food service products, having served as a relationship manager his last year.

His undergraduate degree is in Social Sciences from the State University of New York at Buffalo.

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