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With identity theft on the rise, here are 10 ways to protect yourself and your portfolio.
Editor’s Note: It’s our pleasure to have Steve Weisman pen today’s Daily Profit. Cyber security has been at the top of our minds lately, and Steve is an expert in preventing identity theft. In fact, we think it’s so important that we’re giving away a copy of his book Identity Theft Alert to the next 100 subscribers to Personal Wealth Advisor. You also get our report Profiting From Cold War 2.0: Digital Defense Contractors for Your Portfolio. Click here to get them both.
Identity theft is the biggest and fastest-growing crime in the world, and with good reason: It is easy to perpetrate and easy to get away with.
Through modern technology, an identity thief half way round the world can steal your identity from your computer, your laptop, your tablet or your smartphone. But identity theft is not just a high-tech crime. Identity theft is high tech, low tech and no tech. Some identity thieves will steal your trash to find their treasure, namely financial records that you might have thrown away without shredding.
Everyone needs to take steps to protect themselves from identity theft, but investors are at particular risk and should take additional precautions. Here are the top 10 things you should be doing.
How to Avoid Identity Theft
1. Install proper firewalls as well as anti-virus and anti-malware software on all of your electronic devices, including your computer, laptop, smartphone and tablet. Use encryption software on your smartphone.
2. Use a unique password on each of your accounts. A strong password should have a combination of capital letters, small letters and symbols. An easy way to create a strong password is to use a phrase such as “IDon’tLikePasswords” and then add a couple of symbols at the end so it reads, “IDon’tLikePasswords!!” You can use this as a base password for all of your accounts by merely adding a few letters at the end to distinguish each account’s password, so your online banking password could be “IDon’tLikePasswords!!Bnk.”
3. Never provide personal information online through a website unless the URL begins with “https,” which indicates that your communications are being encrypted.
4. Cross shred documents that contain personal information before discarding.
5. Never click on links or download attachments unless you are absolutely sure that they are legitimate. Links tainted with keystroke logging malware will enable an identity thief to steal all of your personal information from your computer or other electronic device and use it to make you a victim of identity theft.
6. Consider using two computers at home. Limit the use of one to online banking and other financial transactions. You and other family members (such as children or grandchildren who might unwittingly be downloading keystroke logging malware while looking for free music or games) can use the other computer for your email and other connections to the Internet.
7. Use dual factor identification or security tokens when available for your investment accounts and other accounts. This dramatically increases your protection from identity thieves. If the celebrities whose nude photos were recently stolen had used available dual factor identification, they would not have been hacked.
8. Don’t use public computers for financial transactions.
9. Never give personal information to anyone on the phone whom you have not called. Even if your Caller ID indicates it is a call from your broker, identity thieves utilizing a technique called “spoofing” can make it appear on your Caller ID that a call from an identity thief is from a legitimate source. If you have any thoughts that a call asking for personal information might be legitimate, hang up and call the real company at a number you know is correct.
10. Limit the amount of personal information that you provide on Facebook and other social media. Personal information available on the Internet in a myriad of sources enables identity thieves to answer the security questions on your accounts, change your passwords and gain access to your accounts.
This was how Sarah Palin’s email account was hacked. An identity thief answered her security question as to where she met her husband by looking up the answer on Wikipedia. You may think that your personal information is not so readily available, but between the information we post online about ourselves and the information available throughout the Internet, you are vulnerable.
Make a nonsensical answer for your security question. For instance, if your security question is “What is your mother’s maiden name?” make the answer “Grapefruit.” It is nonsensical enough so that an identity thief will never guess it and it is silly enough that you will remember it.
These are just a few of the important steps that we all should take to help protect ourselves from identity theft.
Steve Weisman is a lawyer, college professor at Bentley University, author and one of the country’s leading experts in scams and identity theft. He writes the blog www.scamicide.com where he provides daily updated information about the latest scams and identity theft schemes. His most recent book is Identity Theft Alert is available now for free with your subscription to Personal Wealth Advisor.