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Know How People Steal Your Identity

How-Identity-Theft-Works

Having your identity stolen and becoming a victim of fraud can wipe out years of savings and assets and threaten your future security.

The  Federal Trade Commission reports identity theft has topped all consumer complaints for the 11th year in a row. 

How people steal your identity

The first step in protecting yourself against this type of theft is being aware of the ways thieves might access your information and steal your identity. They might:

  • Claim to be a representative of your financial institution.
  • Sift through your trash for discarded papers.
  • Steal newly issued items such as credit cards, checks, utility bills, insurance statements and benefits documents from your unsecured mailbox.
  • Look over your shoulder at the ATM to capture your personal identification number (PIN).

Thieves also may use more sophisticated tactics to steal your identity such as:

  • Phishing: Be sure to watch out for the red flags or phishing emails. Identity thieves send emails pretending to be financial institutions or other legitimate businesses, requesting your personal information to avoid an account closure or suspension. Your financial institution will never initiate contact asking for personal information.
  • Skimming: I sounds complicated, but it's one of the oldest tech scams in the book. Here's how skimming credit card numbers works: thieves use a special storage device that steals credit or debit card numbers, usually at an ATM or POS machine, which they then use to process transactions with your account.
  • Malware use: Scammers use malware, malicious software that affects computers, to obtain your personal information via the Internet. Do your best to prevent computer hacking with a quality antivirus and spyware/malware removal software.

Using your identity

With access to your name, address, Social Security number (SSN), bank or credit card statements or other personal information, identity thieves can:

  • Open fraudulent bank, credit card or cellphone and other service accounts in your name.
  • Change your account information such as your billing address and logins and passwords.
  • Secure loans in your name.

Reporting identity theft

If you suspect that your identity has been compromised, act quickly! Most identity thieves who steal credit cards and other financial data act within the first 48 hours. If you notice any of the above, or if your wallet or purse has been lost or stolen:

  • Alert creditors. Immediately contact all creditors to alert them to the theft and place your accounts on fraud alert at all three of the credit reporting agencies.
  • Report the theft. File a police report with local authorities and the FTC.
  • Change all passwords on your online accounts.

[Any reference to a specific company, commercial product, process or service does not constitute or imply an endorsement or recommendation by the National Endowment for Financial Education.]

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