Scam of the week

Identity Theft

Heard of identity theft? Worried? Well, it is certainly a burgeoning problem. We ask:

1. What is it?
2. Who might be most at risk?
3. What precautionary steps can we take?

1. What is it?

Wikipedia offers a definition: Identity theft is a term used to refer to fraud that involves someone pretending to be someone else in order to steal money or get other benefits. The term is relatively new and is actually a misnomer, since it is not inherently possible to steal an identity, only to use it. The person whose identity is used can suffer various consequences when he or she is held responsible for the perpetrator's actions. In many countries specific laws make it a crime to use another person's identity for personal gain.

2. Who might be most at risk?

Midway through 2009 CreditExpert released a report showing which groups of people are the most vulnerable. Who do you think?

According to the report, you’re most at risk if you’re a tenant and especially if you’re a young professional renting in a city.

Not far behind come singles in their 30s renting from local authorities or housing association. These are followed by graduates who rent in good-class areas while coping with student debts and maybe saving for a deposit on a property of their own.

You may ask: why these groups in particular? The answer is simply that these are people whose personal details are relatively easy to acquire: people who rent are the most likely to have shared hallways and are thus susceptible to theft of their mail. What’s more, they move far more often than home-owners do, and can be less than rigorous in have their mail redirected.

3. What precautionary steps can we take?

Try to ensure that your post is secure. If it’s delivered to a communal area, explore the possibility of a lockable postbox. When you move, tell the organisations that you deal with where to send all future correspondence. Get the Royal Mail to redirect post to your new address for a year.

And what about the rest of us? We say “better shred than dead”.

Letters and envelopes that carry your personal details should be rendered unreadable before disposal – what’s rubbish to you is a welcome gift to the fraud-minded sifter of trash.

Another safeguard is to check your bank and credit-card statements diligently and make sure that you can explain every transaction thereon.

Check your credit report to make sure that nobody has applied for credit in your name. At the time of writing this article it was possible to get a free credit report from Credit Expert (but don’t forget to cancel after the 30-day trial ends).

‘Phishing’ is simply the attempt at identity theft via email. The subject of phishing is dealt with extensively in our Computer Tips numbers 1 and 2, and we won’t cover it here.

A handbag! Lady Bracknell didn’t have theft in mind when she uttered her famous one-liner, but we do. The view of fraud specialists is that, because fashionable bags are quite large, women are more likely to carry more of their vital documents - passports, payslips, etc - in them, which can then all be used to steal your identity. Even at home do try to keep personal documents secure.

Don't let cards, credit or debit, out of your sight, and ensure that you and you alone know your PIN.

For further information, do make time to visit two very relevant websites, namely www.stop-idfraud.co.uk and www.identitytheft.org.uk.

If you’re unfortunate enough to be a victim of identity theft and find yourself in receipt of an ominous letter from a debt-collection agency, check that the agency itself is genuine. Once that’s been established, it’s essential you let them know that you’re disputing the charge, and why. You should be able to find support and advice from www.e-victims.org and www.cifas.org.uk.

Finally, since we wrote the above, the Financial Services Authority has opened a website called www.moneymadeclear.fsa.gov.uk which we commend to your attention. On the subject of identity fraud it has this to say:

What is identity fraud?

Identity fraud is where someone impersonates you without your knowledge or consent, or uses your personal information to obtain money, goods or services. They may open credit cards or bank accounts using your stolen personal information or take out car loans or mobile phone contracts.

Identity fraud can happen to anyone, young or old – fraudsters aren’t fussy. A quarter of the UK population has been affected by identity fraud or knows somebody who has. It’s up to you to help stop them and report any unfamiliar transactions as soon as you can.

How does identity fraud happen?

Identity fraud can happen in a number of ways.

• While you are at home – for example when you throw personal information such as bank or credit card statements out with your rubbish – fraudsters have been known to raid bins! Credit and debit card slips and even unwanted post should all be destroyed. If you move home and forget to forward your mail, your personal information may end up in the wrong hands. Personal information sent to your current address may also be intercepted – by people who have access to your letter box – for example if you share a flat or house.
• While you are out – for example if you lose your purse or wallet or if you have your card ‘skimmed’ (the information copied) when you are paying for something. This can be done using a machine or simply by someone copying down your details when out of sight, for example if a waiter or sales assistant takes your card to a central terminal to enter the details.
• When you are online – for example fraudsters may be able to get your personal information from social networking sites or from unsecured websites. You may receive emails saying they are from your bank and asking you to re-verify details such as your online banking passwords or PINs (personal identification numbers). Often the email will ask you to click on a link to the company website and enter your details. The website will look genuine but will in fact have been created by the fraudsters. The information you provide can then be used by them. This is known as ‘phishing’. Your bank should never ask for your personal details in an email.

How to avoid becoming a victim

Use these tips to keep your money safe.

• Keep your documents safe by limiting the number that you carry around with you. Shred all documents containing personal or financial information when throwing them away.
• Minimise the number of cards you carry – watch cashiers when you pay by card and don’t let cards out of your sight. For example it is very easy for someone to copy your details if you leave it for a tab behind a bar.
• Memorise your passwords and PINs – don’t write them down and never share them. Avoid using easily identifiable information like your mother’s maiden name or your phone number. Don’t use the same PIN for all your cards and accounts.
• Protect your post – if you move home, tell all relevant organisations as soon as possible and redirect your mail for at least a year. If you have a central or communal postal delivery point, for example in a block of flats, try to secure your post with a lockable post box. If you can’t, then collect mail as soon as possible. Know when to expect your bills and contact creditors immediately if bills do not arrive.
• Stay safe online – get a good anti-virus, firewall and anti-spam package. Be careful what information you place on social networking sites. Never respond to emails requesting personal information or confirmation of passwords. Before entering any personal information online, check that website addresses are spelt correctly so that you are not redirected to a similarly named fraudulent site. Secure websites begin with ‘https’ and a padlock symbol will usually appear in your browser.
• Be vigilant – never give out any personal information unless you are certain of who you are providing it to. Never give out information over the phone unless you have verified who you are speaking to – call them back using a published phone number instead of any direct line that they might provide. Always check bank statements and bills, and investigate payments that you don’t recognise.

You can use the Stop ID Fraud’s online test to check whether you’re at risk and find out what you can do to protect yourself.

And remember, protect yourself, not just this week, but constantly. Anyone can be targeted for identity fraud. But these few simple steps can dramatically reduce the risk of becoming a victim. Once you get into the habit, it will become second nature. Keep yourself and your money safe.

What to do if you think you have been the victim of fraud

Take action straight away. If you think you have been the victim of identity fraud which has involved the use of plastic cards (such as credit and debit cards), online banking, or cheques, you should report it to the financial institution concerned. They will then, if appropriate, report the matter to the police.

If you have any suspicions about identity fraud you can always check your own credit reference files with the relevant credit reference agency. Since you may not know you have been a victim of fraud, it is worth making regular checks of these. This way you can also keep an eye on your recorded credit history.

If you have been a victim of ID fraud you can register with CIFAS to stop your personal information being misused. See their website for further information.