IDENTITY THEFT

by Donald B. Nevard, J.D., General Counsel

For the last couple of years, thieves have turned their attention from the old fare to something new and different — identity theft. This expanding area of criminal activity includes not only the identities of individuals, but also that of small business owners.

According to bankrate.com, in 2001 there were 500,000 cases of identity theft which cost banks and credit card companies more than $5,000,000,000. If this happens to you, you can expect to spend 175 hours and more than $1,250 cleaning up your credit reports.

Generally each transaction that you enter into requires you or your company to share financial and personal information such as your bank account number, your credit card number, your social security number, your tax ID, your name, your address, your telephone number, etc., etc., etc. Most of us to not give a moment's thought to providing this information. It is a part of doing business. But this information can be gathered and used for legitimate purposes and for illegitimate purposes with equal ease. Therein lies the problem. How does one conduct business without becoming the victim of identity theft?

First of all, one must recognize that identity theft can happen in a variety of ways to a variety of people. Pertinent information might be found on a website, through an internet purchase, or by simply rummaging through your business or household trash. This is not just an electronic crime, most of us carry much of this information on our person, either in our wallet, our purses, our briefcases, etc. Once the thief acquires the information he or she needs, it is quite easy to open up new bank accounts, acquire new credit cards, and then to begin running up huge bills in someone else's name — your name.

So what can a business do to protect that information? First of all, everyone should be careful about how you dispose of your personal and business trash. Security procedures should be in place to make sure that business and personal information is well protected. Periodically, you should review the condition of both your personal and business credit by contacting major credit bureaus.

The following are seventeen basic tips which should help reduce your risk of identity theft:

1) Guard your social security number. It is the key to your credit report and a prime target of criminals. Should you believe that someone is using your social security number inappropriately, contact the Social Security Administration's fraud hotline immediately at 1-800-269-0271.

2) Monitor any credit reports. They contain your social security number, present and prior employers, a listing of a variety of account numbers, and your overall credit score. After applying for a loan, a credit card, etc., request that your social security number on any application be removed and that your original credit report be shredded in your presence. A lender only needs to retain your name and credit score.

3) Shred all old bank and credit statements before trashing them. Be sure to use a cross cut shredder. Cross cut shredders are more expensive but do a better job.

4) Remove your name from the marketing lists of the three credit-reporting bureaus. This reduces the number of pre-approved credit offers you will receive. These companies are: Trans Union, 1-800-680-7289; Experian, 1-888-397-3742; and Equifax, 1-800-525-6285.

5) Add your name to the name-deletion lists of the Direct Marketing Association's mail preference service and telephone preference service used by banks and other marketers.

6) Do not carry extra credit cards or other important documents except when necessary.

7) Place the contents of your wallet on a photocopy machine. Copy both sides of your license and credit cards so you will have all the account numbers, expiration dates, and phone numbers should your wallet or purse be stolen.

8) Do not mail bill payments or checks from your home. They can be stolen from your mailbox and washed clean in chemicals. Instead, take them to the post office.

9) Do not print your social security number on your checks!

10) Order your Social Security Earnings and Benefit Statement once a year in order to check for fraud.

11) Examine the charges on your credit card statements before paying them.

12) Cancel unused-credit card accounts.

13) Never give your credit card number or personal information over the phone unless you have initiated the call and trust that business.

14) Subscribe to a credit report monitoring service that will notify you whenever someone applies for credit in your name.

15) Close any accounts that have been compromised, and place 'stop payment' orders on lost checks. Also, cancel lost credit/debit cards and have new ones issued.

16) Report the loss of your driver's license to your state's Driver's License Fraud Division or the Department of Public Safety. In Oklahoma that number is 405-425-2477. Ask that your license by 'flagged' as lost or stolen and have a new one issued.

17) Investigate appropriate 'fire walls' and other protective devices for your home and personal computers.

Individuals should also consider placing passwords on credit card accounts, bank loan accounts, etc. Passwords should be words that are not typical but have a specific meaning to you.

Although these hints are not foolproof, they can help protect valuable information about you, your home, your family, and your business. Bear in mind, only you can prevent forest fires and identity theft.