Chances are you think that you won’t be affected by the nation’s number one fast-growing crime. Think again. Identity theft is on the rise.
In 2005, 9.3 million Americans were victims of identity theft according to the Javelin Better Business Bureau survey. 68.2 percent of the cases involved thieves who obtained personal information off-line vs. only 11.6% obtained online. ID theft through lost or stolen identification, misappropriation by family and friends, and theft of paper mail are among the most common ways thieves gain access to your information.
Most people do not have a clue how to protect themselves.
For a moment, let’s just examine what could happen in your life if you are targeted for this crime:
Victims now spend an average of 600 hours recovering from identity theft over a period of years. This equals nearly $16,000 in lost potential or realized income. Typical out-of-pocket expenses are $1,500 on average.
Even after a thief is stopped from using your information, sometimes up to as much as 10 years, victims still struggle with the impact of identity theft. That includes increased insurance or credit card fees, inability to find a job, higher interest rates, as well as continuing to battle collection agencies that refuse to clear records despite substantiating evidence of the crime. How stressful do you think this situation would be?
The emotional impact on victims is likened to a violation similar to what victims of violent crime describe including rape, violent assault and battering. People feel dirty, ashamed, embarrassed and often are afraid to ask for help. Many have reported a split with a spouse of significant other as well as being unsupported by family members.
Most victims report a lack of responsiveness from those entities they turned to for help including police, collection agencies, credit issuers, utility companies and financial institutions. The average arrest rate for identity theft based on reported cases is 5%. The message here is crystal clear – we have to fight identity theft ourselves!
Exactly what are the different types of identity theft and how do identity thieves get access to your personal information?
Financial Identity Theft
This is the kind of identity theft most people think of first. Thieves hack into your computer at home or at the office and steal personal information. It accounts for about 28% of all identity theft happening today.
For example, thieves will: use your line of credit to make purchases use your credit cards to make purchase open up a mortgage using your name and social security number create a loan using your name and social security number file bankruptcy under your name open phone or utility accounts under your name attempt checking and/or savings fraud (accessing your accounts) attempt to use existing accounts to make purchases
Under the Fair Credit Billing Act, your liability in the case of unauthorized credit use is limited to $50 per card. However, in order to take advantage of this protection, you must file a dispute letter within 60 days after the first bill containing the error was mailed to you. So what happens if the thief changes your address and you don’t receive your bill? Guess what, you are held financially liable. In addition, the Electronic Fund Transfer Act has the same 60 day notification provision or your liability is unlimited. Not fair, but it’s the reality.