Identity Theft – Don’t Make A Critical Mistake

With the good comes the bad. With the explosion of the digital services age has come an explosion in a crime known as identity theft. It is now the fastest growing crime with an identity being stolen once every two seconds. That’s 15 million a year and rising quickly.

Most people picture identity theft as something that occurs when someone rifles through your garbage can looking for credit card statements or what have you. This does happen and you should shred anything that contains your personal information. The shredders are less than $50 at your local office supply store or online, so don’t be lazy with this. Still, this is not where most identities are stolen and it is a huge mistake to think that just protecting your own stuff can make a major difference in your identity theft risk. Why is this? Let’s look at an example.

The Christmas season in 2006 was a big one. This was before the Great Recession when we all still had credit, homes and unemployment was not in the teens. Ah, the good old years! Regardless, the news that broke early in 2007 was scary. TJX reported that it has a rather large problem. It’s payment processing system had been hacked and huge numbers of customer data profiles including debit and credit cards were copied by hackers. Never heard of TJX? This isn’t surprising. It is better known as the parent company of retail stores like Office Max, Marshalls and a host of others. The total transactions copied were believed to be in the millions.

What can we learn from the TJX case? The general rule is you are not in control of your identity. You can shred all you want, but what happens when a store, medical office, bank or some other entity has its database hacked? This happens all the time. In fact, you would be stunned to learn how many times an employee at a company loses a laptop with tons of customers information. The same goes for bank tellers who make copies of customer information and sell it. If you don’t believe me, just set up a Google alert for both of these and watch the stories roll in every week.

So, what can you do about all this? Well, the answer is fairly straightforward. You need to monitor your credit. You can do it yourself or hire a third party service, but you are absolutely nuts if you don’t check it at least every few months. If you don’t catch identity theft problems early, you are in for a world of hurt as you try to get your financial life back in order.