Identity fraud continues to grow -- but in new forms that are harder to detect and prevent.
That's the message from the 2016 Javelin Identity Fraud Study. The good news is that credit card fraud at the point of sale is declining as EMV (chip) cards are now more widely used. The bad news is that identity fraud is increasing online, where those chips have little protective value. And even worse, smart criminals are recognizing that they can steal a lot more money using personal information internationally -- where fraud may take longer to be uncovered.
It's sobering to realize that last year more than 13 million Americans were victimized by identity fraud. It almost makes you feel that you will inevitably become a victim. But there are a few things you can do to shift the odds in your favor:
Freeze your credit. Simply contact the three major credit bureaus (via the authorized website, www.AnnualCreditReport.com) and tell them that you want to institute a credit freeze. There will be a small cost, unless you have already been a victim of identity theft and have a police report to prove it. You can "unfreeze" at any time. Of course, you don't want to do this if you're about to refinance your mortgage, buy a home, change your insurance policy, apply for a job or apply for new credit. But if your life is settled, a credit freeze will keep you safe from most identity bandits.
Monitor your existing accounts. It doesn't take much time, and it's easy to get into the habit of going online (securely, and not using public Wi-Fi!) to check your bank and credit card accounts on a regular basis.
Check your credit report throughout the year at AnnualCreditReport.com. You are entitled to one free credit report from each of the three major credit bureaus, each year. Space your credit report inquires throughout the year. Look carefully for any credit accounts listed on your report that do not belong to you.
Consider a credit monitoring service. With so much information being traded globally on the so-called "dark web," the shadowy, often criminal networks operating on the World Wide Web, you need detection and protection before someone opens a new account in your name, which may not require a credit check.
Companies such as Lifelock and EZShield monitor all sorts of public records as well as the global dark web to detect and, to some extent, protect you against identity fraud. And they offer services to help you restore a secure identity. EZShield services are accessed only through its business partners, including many banks. Lifelock services can be accessed for a fee at its website, www.Lifelock.com, or though many financial firms and credit bureaus.
Trust your bank or financial services firm. According to the Javelin survey, consumers so mistrust their own financial institutions that they do not take advantage of the protection that is easily available to them, such as transaction monitoring, account alerts, two-way authentication and holds until you can authenticate purchases above a certain amount or in a geographical area outside your home base. Ask your bank or card issuer what services they provide, free of charge.
You'll never know how valuable your identity is until it has been compromised. Or how much cost -- both emotional and financial -- is involved in trying to repair the damage. New technologies are forcing fraudsters to become more creative. It takes pros to keep up. It's time to pay the cost of protection. And that's The Savage Truth.
Terry Savage is a registered investment adviser and the author of four best-selling books, including "The Savage Truth on Money." Terry responds to questions on her blog at TerrySavage.com.