Identity Theft Protection

BY JUDY LEV, COREY LEV, CPF® AND MICHAEL ROSEN
No one can doubt the immeasurable benefits of the information revolution. Today, thanks to e-mail and the Internet, many of us are more productive, informed and connected than ever before. Unfortunately, as a result, we are also more vulnerable.
Identity theft typically occurs when someone uses your name and confidential information - including your Social Security number, date of birth and mother's maiden name - to do something you didn't authorize.
A thief can obtain information about you by stealing your wallet, breaking into your car or home, going through your trash or illegally taking mail out of your mailbox. Techniques that are more sophisticated include hacking into databases and websites, sending out fake e-mails (called &#8220phishing”), buying website addresses similar to those of financial institutions and creating computer &#8220spyware” programs that record your keystrokes.
Charges or withdrawals you don't recognize on statements from your credit card, bank or brokerage firm, failure to receive a new credit card upon expiration or a check that a payee didn't receive all point to the possibility that someone may have accessed your account without your knowledge.
How can you protect your personal information? Here are some specific steps you may wish to consider:
Maintain Your Privacy
• Before giving out your date of birth, Social Security number, or driver's license number, ask why the information is needed.
• Shred anything with your personal information: Account statements, credit card solicitations, checks (both canceled and unused), pay stubs and medical records.
• Include only the last four digits of your credit card account on payment checks.
Monitor Financial Communications
• If someone contacts you by phone, letter, or email claiming to be from your financial institution and informs you of unusual account activity or asks questions to verify your identity, don't provide any information. Call the financial institution's main number to ensure that you're speaking with an authorized representative and report the incident.
• Scrutinize every account statement you receive and make sure you can identify all the transactions. Some thieves will put small charges on your card (some under $1) to see if you catch on before they start making larger purchases.
Use Updated Computer Technology
• If you're using a computer at home set up a firewall and keep your virus protection and spyware detection programs current. If your computer has a feature for Internet use that notifies you if a form you're submitting is being redirected, be sure that feature is activated.
• When conducting online transactions, look for &#8220https” at the beginning of a Website's address - the &#8220s” indicates that the information was transmitted in encrypted fashion from a secure site.
Safeguard Your Credit Information
• Consider using one credit card that has a low limit for online purchases.
• Keep copies of your credit cards in a safe place, and only carry cards you need.
• Cancel and then cut up credit cards you don't use.
• Take advantage of the free credit report you can get from Equifax, Experian and TransUnion, the three major credit bureaus. You can call 1-877-FACT-ACT (1-877-322-8228) or go to www.annualcreditreport.com. Review the accounts in your name-if you don't recognize them, contact the credit bureaus immediately.
How to Respond
Unfortunately, even the most cautious of consumers can still be victimized by identity theft. If it happens to you, here are five steps that can help:
1. Call your financial institution immediately and close the compromised account. Ask what they recommend you do next.
2. File a complaint with the Federal Trade Commission, 1-877-IDTHEFT (1-877-438-4338), www.consumer.gov/idtheft.
3. Contact the Social Security Administration, which maintains a fraud hotline,
1-800-269-0271, www.ssa.gov/oig/public_fraud_reporting/index.htm.
4. Contact the fraud division of one of the three main credit bureaus to consider having a fraud alert put on your file. The credit bureau will then notify the other two bureaus of the fraud: Equifax (1-888-766-0008, www.equifax.com), Experian (1-888-397-3742, www.experian.com) and TransUnion (1-800-680-7289, www.transunion.com).
5. You can file a police report and submit a copy to the financial institution affected by the fraud as proof of the crime.
In working with credit card companies, banks, credit bureaus and law enforcement agencies, the time it takes to recover from identity theft can be extensive. A 2003 study by the nonprofit Identity Theft Resource Center found that victims of identity theft spend 600 hours each recovering from the crime. Protecting your information to begin with is certainly the most cost- and time-effective strategy.
Judy Lev, Corey Lev, CFP® and Michael Rosen are Financial Advisors with Smith Barney located in Manhasset, NY and may be reached at
1-800-348-3488.
Smith Barney is a division of Citigroup Global Market Inc. Member SIPC.