According to the 2007 study conducted by Javelin Strategy & Research, the average loss of a victim of identity theft through spyware installs, viruses, different hacks, etc increased from $5,981 last year to $7,561 this year.

So we’d better learn all possible ways to protect our bank accounts…

In the previous article about anti-identity theft measures I mentioned that you can employ the credit card monitoring services that will alert you when fraudster will try to steal money from your credit card.

Today let’s explore 2 more methods that can help you to protect your money from identity thieves.

Those measures are specific for the USA, but I’m sure there are similar services in other
countries too.

Method 1: Opt-Out from Pre-Approved Credit Card Offers

Ok, so what can you do to sleep better at night? Well, you can get rid of all those
pre-approved credit card offers that pile up in your mailbox. If you need new credit card,
it’s better to apply to a specific credit card, and not the random one you found in your
mailbox. Keep in mind that the credit cards that are sent to you have the advertisement and mailing cost included in the rate they are offering, so you might be better of making your own research first, and to apply to a card with good APR (don’t pay too much attention to initial offer, look at the real rate. When initial offer is over, you’ll still have to live with that credit card.)

If you want a new credit card with low rates, etc, here is a good place to start your credit card research:
http://www.1ezhost.biz/creditcards.html

If you doesn’t plan to apply for a new credit card in the nearest future then the mounts of pre-approved offers in your mailbox are not only unnecessary, they could be quite
dangerous. Substantial percentage of identity theft frauds is possible because of the
stolen paper mail.

You can stop vendors from sending you all those offers by calling
888-5OPTOUT (in the USA). I’m sure there are similar services in other countries too, just look on the Internet for the “opt-out option for pre-approved credit cards” (or similar) and add the name of your country to a search string.

Method 2: Freeze Your Credit

When identity theft became a massive phenomenon, banks and government tried to work out the solution that would help people whose identity was already stolen.

One of the worst things with identity theft is not when somebody got access to victim’s credit card number and made several purchases through this card. After all, credit card
balances are usually rather limited.

The worst thing is when fraudsters gather enough information about the victim to be able to apply for new credit cards on this person’s name, and provide different mailing address. So it could be a long period until the victim realizes that he has many more open credit cards that he actually applied for. Quite often it’s happens when person tries to apply for a loan, and bank declines his request, states that victim’s credit score is way below the acceptable minimum and shows him and outstanding balances for all the credit cards he “used”.

To help victims, credit agencies suggested to implement credit freez. Basically, this means that no one with the credentials of identity theft victim would be able to apply for any credit card or loan until credit freeze is raised.

Of course, the worst case scenario wouldn’t happen if a person use credit monitoring
services I mentioned earlier, many people still don’t use it.

Credit freeze is convenient, it could be raised for a small fee for a limited time, and
then applied again. The only problem is, in most states it was unavailable to a general
public, this law was only applied to identity theft victims.

Kudos to California. It was the first state that implemented credit freeze (in 2003).And
double Kudos to California for allowing general public also use this law to their advantage.

Other states agreed to apply this law for identity theft victims, but were not so quick to
apply it to the rest of consumers. Many states implemented this law in 2007.

At the beginning of 2008, several more states (Arkansas, Massachusetts, Maryland,
Tennessee and Utah) will join the group. The latest will be Washington, it will allow
credit freeze at September 1, 2008. Overall, by 2008 credit freeze will be implemented in
40 states.

Here is the how you can find information whether credit freeze is available in your state
or not, and if it’s available, how to apply.

Go to http://consumersunion.org/securityfreeze.htm

I’m not sure whether credit freeze is available in other countries or not. If it’s not
available, then contact your politicians. It’s one of the most efficient measures to
prevent identity theft. Hackers will always be several steps ahead of any online security
system that could be invented. So it’s better to pay a few bucks to lift a credit freeze
when you actually need a credit card or loan, and then apply it again than leave your
credit unprotected.

This entry was posted on Wednesday, September 26th, 2007 at 1:55 pm and is filed under Identity Theft, Main. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.