5 Steps to Protect Your Digital Identity in The Age of Breaches

July 9, 2018 &• 8 min read by Matt Lewis Comments 0 Comments

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The record number of data breaches in 2017 (1,579 publicly-reported breaches to be exact) and the sensitivity of the data stolen (especially social security numbers and passwords) have led many to wonder how to protect themselves. Since I work in the identity protection industry, my friends and family have asked what recommendations they should follow to secure their personal data. In this write-up, I’ll share some basic information, options, and suggestions for what to do in the wake of a data breach.

Credit Card vs. Identity Theft, Understanding the Difference

First, let’s distinguish credit card theft from identity theft. My credit card number is stolen reliably about once per year. It’s a nuisance, but that is all. The bank eats all losses related to the theft and I simply get a new credit card number. But if a thief gets a hold of my SNAPD info (SSN, Name, Address, Phone number, and Date of birth) and applies for a credit card in my name—that is identity theft, and it is more difficult to remedy. I may not even realize it has happened until I try to buy a car and my loan application is denied because my credit has been ruined (after, for instance, a thief opened a credit card account with my information, racked up charges, and never paid the bill). I can’t easily change my SNAPD info like I can a credit card number, so I must begin a long, painful process of trying to restore my good credit. Because my information is spread out across so many companies, it’s on me as the victim to clean it up everywhere, and I may not be able to buy anything on credit until that’s done.

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How do you prevent identity theft from happening? Unfortunately, there is no silver bullet. Think of protecting your identity health like protecting your body health. To be healthy, you pursue a combination of diet, exercise, physical checkups, etc. The same is true with identity health. You must follow preventative steps to keep your information safe.

While the biggest breaches are months old, we aren’t out of the woods yet. Perhaps we’ll see better protections and systems put in place over time. But for now, your SNAPD info remains a bit like a credit password you cannot reset, putting you in a horrible position if it gets stolen.

Credit Freezes

There are many articles recommending consumers freeze their credit. This involves getting a pin number you can use to turn your credit off and on with the primary credit bureaus: Equifax, Experian, and TransUnion (Innovis, the fourth largest, is also sometimes included). While your credit report is turned off (frozen), any applications for credit (including those by thieves) will be denied. When you apply for something that requires a credit check (mortgage, car loan, cell phone account, etc.), you must unfreeze your credit before you apply and then turn it off again once the credit decision is made. You will pay a fee ($10 or so per bureau, depending where you live) each time you activate and deactivate the freeze, which state attorneys general are now successfully pressuring the bureaus to waive. Freezing your credit certainly seems like a good idea now that the most sensitive information for half of all Americans is known to be in the wrong hands. It is up to each person to decide whether the hassle and cost is worth it.

It is important to understand that even after freezing your credit at the primary bureaus (remember, no silver bullet), you may still be vulnerable to identity theft. There are other smaller and less frequently used credit bureaus. Also, freezing your credit will not protect against transactions that don’t go through a credit bureau, which can include payday lending, tax filing, health care transactions, etc. That being said, don’t let the presence of scary diseases stop you from taking basic health precautions that are within your control.

Credit and Identity Monitoring

Another option to consider is credit or identity monitoring services. Credit monitoring services, including some offered for free after a breach, will alert you when you have credit activity at the major bureaus. Identity monitoring services usually include credit monitoring, plus identity monitoring features such as monitoring the dark web for your information or alerting you to other important events that do not traverse the bureaus. Some identity monitoring services will also help you to resolve issues if you are exposed to identity fraud, and/or insure you against financial losses that may result from identity theft. It can be somewhat confusing because many offerings have the name “identity” or “ID” in them, including those that only provide credit monitoring. Make sure you read the full service offering and understand everything you are being provided. Full disclosure: I am an employee of ID Analytics, a Symantec company and receive a free subscription to LifeLock, an identity theft protection service, as an employee benefit.

To summarize: When considering ways to protect your personal data, good options to consider are freezing your credit, signing up for a credit or identity monitoring service, or both. If you choose either of these options, do not take the approach of just doing something for a few months until the current breach news dies down. It may take time for the stolen data to be sold and distributed, and the bad guys are aware that everyone is on guard when breaches are top headlines. There is a good likelihood that at least some fraudsters will wait until the news cycle moves on and people let their guard down, to increase the chances of their fraud going undetected. It is common to see a burst of fraud activity a year after a breach.

Digital safety also includes protecting your passwords and being aware of phishing/social engineering techniques.

Passwords

You have likely heard a lot of advice about passwords that you are not following because it’s not practical. For instance, we’re told to use different passwords for every website, but now that we all have dozens (or hundreds) of logins, remembering separate passwords simply isn’t possible. About half of consumers reuse passwords across sites and billions of passwords have been exposed in breaches.

In my opinion, the best way to solve for passwords is to use a password manager, such as LastPass, Dashlane, 1password, or Norton Identity Safe (compare features to pick the best one for you). With a password manager, you create one master password that unlocks access to all your other passwords, which it will auto-fill into web site forms for you or allow you to copy/paste whenever needed. I let the password manager generate and manage a different 16-digit complex password for each site (you must change your existing site passwords to get this benefit). It also stores other secret information for me, such as credit card numbers, family member SSNs, etc., making it a full-featured secure digital wallet. It allows me the convenience to copy/paste these values whenever needed across all my devices, along with the security of strong encryption.

At a minimum, take the time to create two reasonably complex passwords, one that you use for less secure sites (cat toy shopping sites, knitting discussion boards, etc.), and a second that you use for sites that must be secure (banks, retirement accounts, etc.). If thieves steal username and password combinations from less secure sites, they will try them at bank, investment, and email sites too. By separating those two categories of sites, you add some protection. A reasonably complex password should be 8-20 characters and include uppercase, lowercase, numbers, and special characters.

Phishing / Social Engineering

Phishing and social engineering fraud involves fraudsters trying to trick you into giving them your information willingly (under false pretenses). It may be a phone call where they ask for personal info or passwords, it may be an email with a link or attachment, or it may be a browser window that pops up from a web site you visit. The best general defense against this is to educate yourself. Consider taking an online mini-course to become familiar with the types of emails, pop-ups, and web addresses that are considered suspicious. If you’re a novice, try AntiPhishing Phil. It’s dated, but it’s the best game I could find to teach some basics. Below are two other scenarios to be mindful of, which I have seen friends and neighbors fall victim to.

Do not click on or follow the instructions of any warnings saying your computer has been hacked, encrypted, is in danger, or instructing you to call a number for protection or more information. In my experience, 99% of the time, these are browser pop-ups trying to trick you into clicking something. Just turn off your computer and avoid that website. If you don’t have a quality antivirus & security package installed, this is another important piece of protection.

Do not give any personal information or passwords over the phone (or in person). Good guys will never ask you for your password (though my cell phone company now asks me for a passcode I had to set up for service calls…sigh) and should not ask you for sensitive information like full SSN. I have had legitimate folks ask me for my SSN to look me up in their system, I simply ask them to look me up another way. Be very mindful of whether you initiated an email or phone call or if the other party did (other party = more risk). If the caller claims to be from an institution you do business with, but you doubt the legitimacy of the call, hang up and call the main number for the business to verify that they were in fact trying to contact you.

When it comes to digital safety, the good news is that I believe over time, more and more solutions will be created that move the burden of security away from individuals. New technologies show a lot of promise that trust can be built into the technology architecture itself. In the meantime, I hope this primer has been helpful.

If you’re concerned your credit has been impacted by identity theft, you can check your three credit reports for free once a year. To track your credit more regularly, Credit.com’s free Credit Report Card is an easy-to-understand breakdown of your credit report information that uses letter grades—plus you get a free credit score updated every 14 days.

Matt Lewis is Director of TechOps for ID Analytics, with more than 20 years of experience in software and technology operations. In this role, he leads the 30-person TechOps department whose philosophy for operational excellence is to build automation that runs the environment, continuously working to eliminate manual steps wherever possible.

Lewis has championed products which use analytics to protect companies from identity and credit card fraud, previously holding positions at HNC Software and FICO. Lewis holds a Bachelor of Science in Electrical Engineering from the University of California, Los Angeles (UCLA).

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Identity Thieves Bought a New Car in Her Name—Here’s How She’s Fighting It

September 25, 2017 &• 6 min read by Kat Tretina Comments 0 Comments

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Jen* is one of the few people that opens and reads every piece of mail they receive. It’s a quirk that has paid off: A piece of junk mail is how Jen found out someone had stolen her identity.

“I opened a letter from Macy’s, which I thought was weird,” she said. “I haven’t shopped there in years. But the letter was a rejection of a credit card application.”

Jen took immediate action, placing a credit freeze on her accounts. She thought it was all resolved then, but her identity theft nightmare was just beginning.

The Depth of the Identity Theft Problem

Jen checks her free credit report every four months. After finding the Macy’s rejection letter, she immediately checked her report again.

There were several credit inquiries for loans and credit cards that she had not made. Banks and lenders had rejected all of them. However, there was one item on the report that had been approved: a car loan for a $30,000 vehicle.

“The thief applied for a loan through an online company, which is much easier than applying for a loan in someone’s name in person,” Jen said. “She picked up a used Lexus the next day. She used my Social Security number but didn’t use my actual last name. The company still didn’t bat an eye.”

The thief even took out a car insurance policy in Jen’s name. Again, the thief applied for an account online for easier approval.

Beyond Credit—How Theft Affects You

“There were about a dozen inquiries on my credit report besides the car loan, all of which hurt my credit score,” said Jen. “And, the thief didn’t make payments on the insurance or the car, which could have hurt my credit too. I had to take action right away.”

Jen then filed a police report. An officer came to her home, and she handed over copies of her credit report with all of the fraudulent inquiries. Because it was a financial matter, the officer handed the case off to a different department.

Once Jen had a copy of the police report, she took action rather than waiting for the police to work it out. Luckily, her employer offered a free identity protection service through InfoArmor. She called the company, and representatives assigned her a case manager. Together, Jen and the case manager made a list of every false inquiry on Jen’s report and started contacting the companies one by one to have them removed.

“There were inquiries for store credit cards, phone companies, furniture stores, and car loans,” said Jen. “All of them were at places in California, and I’m thousands of miles away from there.”

The process couldn’t be completed in one day. The thief had taken information from Jen’s LinkedIn profile to verify employment dates on applications, and the person’s actions changed her security questions on the credit bureau sites as well.

Jen’s credit report now showed the thief’s address and other information instead of her own, so she couldn’t dispute the charges online. Instead, she had to call each business herself and prove her identity.

Most of the companies’ customer service departments were available only between 9 a.m. and 5 p.m., when Jen was at work. “I had to squeeze in calls on my lunch break and every spare minute I had,” she said.

Over the course of two months, Jen spent over 80 hours on the phone to dispute charges and inquiries. There were times when she was on the phone for five hours straight. Despite the long hours, she values the identity protection service for helping her handle it.

“[The case manager] was on the phone with me for the full time,” she said. “He helped me keep it together and work through the list of companies.”

Other Financial Ramifications of Identity Theft

Although the phone calls were tedious and incredibly time consuming, there were larger issues that Jen hadn’t even considered. Her InfoArmor case manager helped her navigate those problems as well.

“I could never have thought of it all on my own,” she said. “But he told me I needed to alert my 401(k) company, my mortgage lender, and my credit union account so [the thief] couldn’t access those accounts too.”

Worst of all, the problem still isn’t over. The car loan has been removed from her credit report, but other inquiries remain. Jen also worries about future issues, such as the thief filing a fraudulent tax return in her name to get a tax refund.

“I’m worried about my taxes,” she said. “It’s a real stressor. I contacted the IRS, but I’m still concerned.”

She has every reason to worry. Despite now having the thief’s full name and address, the police have not yet arrested or charged the individual. Instead, the investigation is ongoing thousands of miles away.

Advice for Dealing with ID Theft

Thanks to Jen’s hard work, her credit score has recovered since the identity theft. She notes that not everyone could handle identity theft as quickly as she did, nor does everyone have the means.

“It was time consuming and tedious, but it was also expensive,” she said. “I had to pay to FedEx documents across the country, to put a credit freeze on my account, and to have access to a fax machine—most of the documents couldn’t be emailed because of security concerns, so faxing them was the only way.”

In addition, Jen said that her employer and coworkers were understanding as she navigated the process. In many workplaces, taking personal calls during work wouldn’t be possible. Other people might have had to take time off from work to deal with identity theft, hurting their paycheck.

For those who face a similar situation, Jen recommends you do the following:

  • Take diligent notes and keep them nearby. Every credit inquiry Jen disputed had its own case number, and because she sometimes had to wait days for a response, Jen had to move quickly when she did get a response. Keeping a notebook handy with every case number, the date and time of each call, and who she spoke to last helped her stay on top of the issue.
  • Check your credit report. Jen caught the problem early, which saved her credit and finances. It’s a smart idea to check your credit report every four months for red flags.
  • Consider hiring a service. While Jen was able to get identity protection for free, she says she would have willingly paid for it. Her case manager helped her through every phone call and identified other actions she needed to take to protect herself.
  • Give yourself a break. Dealing with endless phone calls and the stress of identity theft can be hard on your nerves and well-being. Jen advises giving yourself a break every now and again and indulge in some self-care.

Moving Forward after Theft

Jen doesn’t know how the thief got her Social Security number or name, especially because she’s diligent about protecting sensitive information. However, she suspects it’s from medical forms from her frequent doctor appointments, as they all required her to enter her Social Security number, address, birthday, and other identifying information—making her an easy target for identity theft.

“Unfortunately—and the police said the same thing—people take those forms and sell them on the black market for others to use,” she said. “It’s made me much more conscious of what I put out there.”

Jen’s story isn’t an anomaly. A whopping 41 million Americans have experienced identity theft. That’s why it’s so important to continually and regularly check your credit report.

“You have to stay on it to prevent your name and credit report from being ruined,” Jen said. “Be diligent.”

*Because the investigation into this situation is ongoing, the individual featured asked that we not use her real name.

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What to Do When Your Credit Card Goes Missing

July 16, 2019 &• 6 min read by Bev O’Shea Comments 0 Comments

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You’re likely to lose track of a credit card at some point—many people do. You’re standing at the checkout counter, you open your wallet and it’s not there. What you do depends on how prepared you are and whether you think the card was lost or stolen.

How to Prepare for a Lost Credit Card

Losing a credit card doesn’t have to be something that turns into a nightmare. You can manage the situation more effectively if you’ve taken these three steps to prepare in advance.

1. Choose Your Financial Institutions Wisely

Do you often think your bank could improve its customer service? Have you had past problems getting unauthorized charges removed from a credit card statement? If your bank or credit card company has failed you in the past, it’s more likely it will do so in the future when you need help the most.

Of course, it’s easier to just coast along with whichever company you have been using to meet financial goals. But it’s worth the time to think of worst-case scenarios and make a change to the financial institutions you use before you need emergency services.

Take a few minutes to think how you would rate the services offered by your banks and credit companies and compare policies for lost or stolen cards. Little things can make a big difference, such as a company guarantee to get you a replacement card within a specific time frame.

2. Keep Your Contact Information Up to Date

Imagine you need a replacement credit or debit card, but the agent tells you he can’t send it to your current address because the company has an old address on file. Or imagine trying to activate a card via text or email while you’re traveling, but you can’t get it to work because the company has old numbers and addresses on file.

Unsurprisingly, financial institutions are hesitant to make any changes to an account while it’s flagged for possible fraudulent activity. If you want to get a replacement card in hand as quickly as possible when you need it, make any updates to your contact information now.

3. Keep Your Credit Card Contact Information and Account Number Handy

This one is easy. Record the toll-free support number for each card’s financial institution in your phone’s contact book. Though you could probably track down the number fairly quickly with internet access, time is often of the essence when reporting a lost or stolen card, so make it easy for yourself. Having your account number ready can also save valuable time verifying your identity with the customer service rep.

What to Do When a Credit Card Goes Missing

In general, you should treat a lost credit or debit card as if it was stolen. There’s no major downside to reporting it stolen, other than having to replace the card.

Obtaining the highest level of protection against fraudulent use of your card is based on how quickly you report the incident. Federal law says you have zero liability for any charges made on your card after you report it’s gone, but you may be liable for charges made before you do so.

If You Think Your Card Is Lost

1. Retrace your steps.

You may be lucky. Your card or wallet might be waiting for you right where you left it.

2. Cancel your card, and request a replacement.

Even if you’re lucky enough to find your lost card or it’s returned to you by a good Samaritan, your financial information may be compromised. Someone may have copied all the information needed to process a transaction. It may be best to err on the safe side and get a new card.

If You Think Your Card Was Stolen

1. Report it immediately

Call the financial institution that issued the card using the 24-hour support phone number for fraud prevention and report the card as stolen. If your entire wallet was stolen with multiple cards and pieces of identification in it, call every financial institution as soon as possible.

2. Keep records

Make a record of the time and date of your call and who you spoke to. Since your liability for unauthorized transactions is tied to speedy reporting, plan to prove you were diligent just in case.

3. File a police report

Another way to demonstrate your due diligence and avoid any liability for unauthorized charges is to show you made an official report regarding the incident.

4. Notify the credit reporting agencies

It’s a good idea to put a security alert on your credit reports. Although this may be overkill for the loss of a single card, it can offer an extra layer of protection if the theft evolves into full-fledged identity theft. Victims of identity theft can sometimes have a hard time proving that negative credit reporting was the result of an impersonation. An immediate alert regarding the initial incident can go a long way when you want negative information removed.

5. Watch your account activity

Take advantage of online access to your account to monitor activity. Check your monthly statements immediately upon receipt and not months later. If you see anything strange or unauthorized, contact your financial institution. Don’t assume that because you canceled the card everything is under control. Thieves develop new ways to take advantage of access to even the smallest bit of your financial information all the time.

6. Update your auto payments

Try to remember to do this before the auto payments bounce back for nonpayment. Don’t let the theft of the card derail your good credit.

FAQs

What do I do if I lost my credit card?

To ensure maximum protection against having to pay for unauthorized charges, call the credit card company’s 24-hour support line and report the missing card right away at any time of the day or night. Try retracing your steps if you think you can find the lost card, but even if it’s returned to you by a third party, you may want to request a replacement card to be safe.

Can I track my credit card if I lost it?

New ways to track personal belongings are being developed all the time. Check with your financial institution to see if it has a way to locate a missing card by its internal chip. Some companies offer other features, such as the ability to turn the card on and off with an app if it’s temporarily misplaced.

How long does it take to get a replacement credit card?

Typically, it takes seven to 10 days to receive a replacement card. However, each company has its own policies regarding turnaround time, which can range from overnight to weeks.

Why is my credit card not working?

A credit card can stop working for any number of reasons, including damage to the card or a negative credit balance. Occasionally, a credit card company places a hold on a card if the security agents see a suspicious transaction or a transaction with details that lie outside of your normal spending habits. In these cases, you can usually reactivate your card by calling the credit company and verifying your identity and recent transactions.


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COVID-19 Scams

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As if fearing the health-related consequences of the COVID-19 coronavirus wasn’t enough, there’s also a fair amount of financial uncertainty related to recession and an unstable economy. People all across the United States are wondering how they’ll pay their bills and make ends meet as they file for unemployment and wait for a one-time stimulus check that may not cover the bills.

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It’s unfortunate, but some bad actors will always take advantage of situations like coronavirus. In addition to everything else, individuals also need to be on the lookout for COVID-19 scams that are cropping up. In fact, there are so many coronavirus scams out there right now that the FTC created an FTC Scam Bingo game to try and spread the word.

Read up on what COVID-19 scams to look out for and how you can protect yourself and your finances.

COVID-19 Stimulus Check Scams

Some scammers are tricking people into thinking they need to provide personal information to obtain their government relief check. Consumers do not need to sign up for the federal stimulus checks. The government plans to distribute them based on consumers’ 2018 or 2019 federal tax returns starting April 2020. Keep in mind that the IRS does not initiate contact by email, text, or social media.

How to Protect Yourself

Do not respond to any correspondence claiming to be the IRS or other branch of the government requesting personal information in exchange for access to your stimulus check. For accurate information about the federal relief checks and when you can expect yours, visit the IRS’s coronavirus resource.

Student Loan Scams

Americans owe over $1.64 trillion in student loan debt, so it’s no wonder that scammers are preying on this financially vulnerable population. Watch out for offers to forgive your student loan debt in its entirety or change your repayment plan for a fee, or requests for other personal information in order to suspend your payments in response to coronavirus. There is no such thing as instant student loan relief, and you should not need to pay a fee for help from your loan servicer. All federally backed loans have automatically suspended payments and set interest to 0%.

How to Protect Yourself

Do not accept unsolicited offers to help you with your
student loan payments and never give out your personal information. If you are
having trouble making payments because you’ve lost your job, reach out to your
loan servicer for options.

Social Security Scams

Social Security scams are common, but coronavirus has put a new twist on the scam. Now, in addition to watching out for scammers claiming that your Social Security number is about to be suspended, you also need to watch out for calls or letters claiming that your benefits will be canceled due to coronavirus-related office closures. Social Security offices are closed, but officers are still working, and your benefits will not be suspended. And your Social Security number will never be suspended.

How to Protect Yourself

If you are unsure if a call or email is from the Social Security Administration, reach out to them yourself for confirmation before sharing any personal information. If you have already given you Social Security number to a scammer, visit IdentityTheft.gov/SSA for steps on how to protect your credit and identity.

Medicare Scams

Because older individuals are particularly susceptible to COVID-19, scammers have been targeting them with Medicare scams. Be on the lookout for fraudulent Medicare representatives asking you to verify personal information, like your bank account, Social Security, or Medicare numbers. Medicare representatives will never call you to verify your account number, offer you free equipment or services, or try to sell you anything.

How to Protect Yourself

If you’re
not sure if a phone call is legitimate, hang up and call Medicare yourself.
That way you can confirm that you are talking to an actual Medicare
representative. To reach the Medicare office, call 1-800-633-4227.

Fraudulent Charities

Whether it’s a natural disaster or worldwide pandemic
like the coronavirus, legitimate charities work hard to aid people in need.
This can include providing food, funds, housing or other forms of assistance. Unfortunately,
fake charities can crop up too. They might use names that sound similar to real
charities and may even have emails, websites and phone numbers that seem
legitimate but aren’t.

How to Protect Yourself

Donate to charities that you are already familiar with. If you’re questioning the legitimacy of a charity, you can use third-party websites to check credentials. Options include Charity Navigator and Give.org, which is maintained by the Better Business Bureau.

Protect Yourself from COVID-19 Scams

As you continue to navigate the uncharted waters of a
worldwide pandemic, be on the lookout for COVID-19 scams. If you’re ever unsure
about something, you can consult trustworthy government resources or well-known
news outlets to verify information. Share this information about scams with
others so they know what to be on the lookout for as well.

More resources on scams:

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3 Tax Scams You Need to Watch Out For

January 24, 2019 &• 5 min read by Adam Levin Comments 0 Comments

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According to the Internal Revenue Service (IRS), there was a 400% increase in phishing and malware incidents during the 2016 tax season. And tax scams extend far beyond email and malware to include phone scams, identity theft and more.  While the April 15 filing deadline still feels far away, as Yogi Berra said, “It ain’t over till it’s over.”

Scammers use multiple ploys and tactics to lure unsuspecting victims in. The IRS publishes an annual “Dirty Dozen” list of tax scams. Sadly, while some of those scams lure people into getting ripped off, others lure people into unwittingly committing tax fraud by falling victim to fake charities, shady tax preparers and false claims on their tax returns.

The most important things you can do to keep yourself scam-free and protected this—and any—tax year are to:

  • Be wary—if it seems too good to be true, it probably is
  • Educate yourself on the most common risks out there
  • File your taxes as early as possible

When you file your taxes as early as possible, you can just politely decline scammer and you can protect yourself from taxpayer identity theft. Tax-related identity theft is primarily aimed at someone posing as you stealing your tax refund. Scammers are creative, sophisticated, persistent and move fast once they have your information in hand. Armed with your Social Security number, date of birth and other pieces of your personally-identifiable information, they can rob you. If you’ve been the victim of a data breach—learn the warning signs—your information is likely available on the dark web. With your information, all a scam artist has to do is log in to a motel’s Wi-Fi network, fill out a fraudulent tax return online and walk away with a refund that could be and should have been yours.

What Is a Tax Scam?

A tax scam is a ploy intended to steal your information and/or your money. It can take several forms. The IRS’s “Dirty Dozen” for 2018 includes these scams:

  • Phishing scams, using fake emails or websites to steal personal information.
  • Phone scams where callers pretend to be IRS agents to steal your information or money.
  • Identity theft scams where identity thieves try and steal your personally identifiable information.
  • Return preparer fraud where a dishonest tax preparer submits a fraudulent return for you or steals your identity.
  • Fake charities where unqualified groups get you to donate money that isn’t actually deductible on your tax return.
  • Inflated refund claim scams where a dishonest tax preparer promises a high refund.
  • Excessive claims for business credits where you or a dishonest tax preparer promises a high refund for claiming credits you aren’t owed, such as the full tax credit.
  • Falsely padding deductions Taxpayers where you or a dishonest tax prepare reports more for expenses or deductions than really occurred.
  • Falsifying income to claim credits where a dishonest tax preparer cons you into claiming income you didn’t earn in order to qualify for tax credits, such as the Earned Income Tax Credit.
  • Frivolous tax arguments where a scam artist gets you to make fake claims to avoid paying taxes.
  • Abusive tax shelters where a scammer sells you on a shelter as a way to avoid paying taxes.
  • Offshore tax avoidance where a scammer convinces you to put your money offshore to hide it as a source of taxable income that you have to pay taxes on.

It’s important to know that if you fall victim, you may not just be the victim. You may also be a criminal and held accountable legally and financially for filing an incorrect return.

A new scam recently hit the wires too. For this one, scammers email employees asking for copies of their W-2s. People who fall victim end up having their names, addresses, Social Security numbers and income sold online. The emails look very valid but aren’t If you see this or other emails that stink like “phish,” email the IRS at phishing@irs.gov

1. Phishing

Phishing uses a fake email or website to get you to share your personally-identifiable information. They often look valid. Know that the IRS will never contact you by email regarding your tax return or bill.

Phishing emails take many forms. They typically target getting enough of your personally identifiable information to commit fraud in your name, making you a victim of identity theft if you take the bait.

Phishing emails may also contain a link that places malware on your computer. These programs can do a variety of things—none of them good—ranging from recruiting your machine into a botnet distributed denial of service (DDoS) attack to placing a keystroke recorder on your computer to access bank, credit union, credit card and brokerage accounts to gathering all the personally identifiable information on your hard drive.

Here’s what you need to know: The IRS will never send you an email to initiate any business with you. Did you hear that? NEVER. If you receive an email from the IRS, delete it. End of story. Oh, and it will never initiate contact by way of phone call either.

That said, there are other sources of email that may have the look and feel of a legitimate communication that are tied to other kinds of tax scams and fraudulent refunds. And not all scams are emailed though. A lot of scammers will call. The IRS offers 5 way to identify tax scam phone calls.

2. Criminal Tax Preparation Scams

Not all tax professionals are the same and you must vet anyone you’re thinking about using well before handing over a shred of your personally identifying information. Get at least three references and check online if there are any reviews before calling them. Also, consider using the Better Business Bureau to see if the preparer has any complaints against them.

Here’s why: At tax-prep time, offices that are actually fronts for criminal identity theft pop up around the country in strip malls and other properties and then promptly disappear a few days later. Make sure the one you choose is legit!

3. Shady Tax Preparation

Phishing emails aren’t always aimed at stealing your personally identifiable information or planting malware on your computer. They may be simply aimed at getting your attention and business through enticing—and fraudulent—offers of a really big tax refund. While these tax preparers may get you a big refund, it could well be based on false information.

Be on the lookout for questions about business expenses that you didn’t make, especially watching out for signals from your tax preparer that you’re giving him or her a figure that is “too low.”

If you are using a preparer and something doesn’t seem right, ask questions—either directly from the preparer or by calling the IRS. The IRS operates the Tax Payer Advocate Service that can help answer your requests. The service’s phone may be unavailable during a government shutdown, but the website is always available.

Other soft-cons of shady tax preparation include inflated deductions, claiming tax credits that you’re not entitled to and declaring charitable donations you didn’t make. Bottom line: If you cheat—intentionally or unintentionally—chances are you’ll get caught. So make sure you play by the rules and follow the instructions or work with a preparer who does. Yes, the instructions are complicated. That’s why it’s not a bad idea to get honest help if you need it.

As Yogi Berra said, “You can observe a lot by watching.” Tax season is stressful without the threat of tax-related identity theft and other scams. It’s important to be vigilant, because, to quote Yogi all over again, “If the world were perfect, it wouldn’t be.”

This article was originally published February 28, 2017, and has been updated by a different author.


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14 Ways to Prevent Fraud on Your Debit & Credit Cards

July 4, 2017 &• 7 min read by Bob Sullivan Comments 0 Comments

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Every time there’s a large credit card breach, you’ll hear some expert say risks for consumers are low, because it’s easy to cancel a credit or debit card and get a new one. Not so fast. If fraud appears on your bill, but you don’t notice it, you’ll pay for it. More important, changing account numbers is a hassle. You’ll have to update all your automatic payment accounts, for example. Screw up one of those, and you could get hit with late fees from a merchant when your payment is denied.

Despite the liability limits, you’re better off avoiding all this in the first place. Below are suggestions on how to do that. Most involve limiting the number of times you have to share your plastic with someone, decreasing your “attack surface.” Some might be familiar. Others might seem extreme. Either way, there’s no way to make yourself 100% fraud proof. That’s why we’ve also provided tips on the earliest possible detection and reporting of fraud, which is the main way to protect yourself. For example, regularly checking your credit scores can help you spot fraudulent activities on your credit cards. (You can check two of your scores free on Credit.com.) Here’s how to keep yourself as safe as possible.

1. Avoid Using Debit Cards to Buy Things

When I asked Gartner fraud analyst Avivah Litan about her fraud-fighting tips, this is the first thing she said:

“Never use PIN debit, except for bank ATM machines attached to bank branches.”

PIN debit is the technical term for using a debit card as “credit” at a merchant. From a fraud perspective, the “debit or credit” question is meaningless. Either way, you are putting your debit card account information into databases criminals can hack. And recovering from a debit card fraud is much more of a hassle than recovering from a credit card fraud. With credit card fraud, consumers call their bank, dispute a fraudulent charge and don’t pay for that part of their bill. With debit card fraud, money is taken from the victim’s checking account, and the consumer has to argue with the bank to get it back. That usually happens quickly, but in the meantime, the consumer’s balance can dip below zero, leading to overdrafts and other potential problems, like bounced rent checks.

It’s a bad idea to buy things with a debit card. Use a debit card to withdraw cash at a bank ATM. Otherwise, use credit.

Some people use debit card purchasing as a personal finance tool to limit spending. That’s a rational reason to do so. If you must, don’t use PIN debit, so at least a criminal can’t gain access to your PIN at that merchant.

2. Be Careful With Stored-Value Apps

The latest trend in money is “digitized stored value.” You probably familiar with it if you buy coffee with your Starbucks app. Many merchants are now imitating Starbucks with their own digitized stored value apps. But app makers and merchants are not banks. They have less experience keeping money safe. The consequences have been obvious: Starbucks consumers have complained for nearly two years about criminals raiding their app-linked credit cards. Worst of all, consumers with auto-fill have seen criminals conduct rapid-fire conduct transactions through the apps. Starbucks says this impacts a tiny fraction of consumers, and they are quickly refunded. If you are using “digitized stored value,” manually reloading value is safer than loading your credit card and especially your debit card.

Call: 1.844.346.3296or learn more

3. Have a Separate Card for Digital Transactions

Splitting your transactions among cards can limit the “spillover” if fraud occurs. This tip isn’t for everyone. Some consumers like racking up points on one card. Others are afraid they’ll miss a payment if they have more than one credit card bill each month. But separating out transactions can have fraud-fighting benefits. If you are the type to buy items from less popular websites that might not have the security protections of a larger site, consider having a card you use just for those higher-risk purchases. That way, if the small site is compromised, the impact on your life will be contained.

4. Google Second-Tier Sites

Speaking of second-tier sites, you should always Google them before making a purchase. Search “BobsWidgetSite.com and complaints,” then “BobsWidgetSite and fraud,” before making a purchase the first time. Scroll through a page or two of results, in case the site has done search engine optimization work to beat back complaints. I talk often to victims who do that search only after they are victims of fraud, and then kick themselves.

5. Place a Sticker Over Your Security Code

Here’s a novel idea from computer security expert Harri Hursti. Most credit and debit card credentials are useless without the security code numbers on the back of the card. To limit the risk of physical theft, place a sticker over the numbers and memorize them. They are usually only three or four digits. That way someone else who holds your card for a few moments can’t get enough information to steal from your account. Such physical theft is less common than it once was, but the sticker idea is a simple fraud-fighting tool.

6. Say No to ‘Free’ Trial Offers & Avoid ‘Gray Charges’

About five years ago, a credit card fraud fighting firm named BillGuard.com coined the term “gray charges.” These aren’t traditional fraud, but they aren’t transactions you approved, either. It might be a magazine you didn’t realize you purchased as a bundle at a checkout. It might be a subscription travel service that “accidentally” ended up in your shopping cart when you booked a trip. Or it might be a free trial you forgot about that has now converted to a $20-a-month charge. Either way, gray charges are a hassle, and the easiest way to avoid them is to never sign up for a “free” anything that requires your credit card. Check your shopping carts diligently, and uncheck all the “sign me up for XX” boxes along the way.

7. Don’t Fall for Phishing

Phishing emails have been around for a while – so long you might forget the risk they pose. Big mistake. A study by the University of Texas last year found that phishers “thrive” on consumers’ overconfidence. There was a 500% increase in personalized, social-media-based phishes in 2016. A common, credit-card stealing email might be an alert claiming your credit card on file with iTunes has been rejected, and asking for an immediate update. If you think you can’t be phished, you’re wrong. Never enter your credit card number into a website unless you have manually visited the site by typing the address into your web browser’s address bar. Never click on a link in an email – even one you are certain is real – and enter payment credentials.

8. Don’t Give Your Credit Card Number Over the Phone

This tip is similar: Never give your credit or debit card number to anyone who calls your house. Even if you are certain the call is legit. Always hang up and manually dial the company’s phone number, then give your payment details. That might sound like a hassle, but any reputable company will appreciate your efforts at security. If the person on the other end of the phone gets annoyed, that’s a good indication you are being hustled.

9. Get a Post Office Box

Mail theft is still a cause of identity theft. The simplest way to avoid it is to stop mail from coming to your house. Small P.O. boxes can cost around $100 per year and can offer peace of mind.

10. Use ATMs Carefully & Watch for Skimmers.

You know to make sure no one is watching while you enter your PIN code at an ATM. But how? It’s getting harder and harder to be sure, as hackers are inventing smarter skimmer devices that let them “watch” you remotely. The latest devices are designed to fit snugly over the slot where cards are inserted or even to be snuck inside that slot, invisible to the untrained eye. That’s one reason Litan only uses ATMs attached to a bank branch. ATMs outside grocery stores or gas stations can be easier to attack and often have higher fees. The risk isn’t only at ATMs. So-called “overlays” that fit on top of a merchant point of sale terminal have been spotted at major retailers across the country. Whenever inserting your credit or debit card into any machine, it’s a good idea to look for signs of tampering. You can take a moment to rub your fingers around the edges of a machine to see if an overlay of skimmer has been snapped on top.

11. Keep Track of Your Cards

It’s easy to forget your card at a restaurant after a meal. Develop a personal checklist so you avoid that. Each time you get up to leave a store, or before you go to bed at night, do a card count. If you can’t find your card but you are hopeful it will turn up, you might have better options than you realize. Many times, people are loathe to call and report lost cards because of the ensuing hassle. Some banks let you temporarily “freeze” your card while you look for it, then turn the card back on if it’s found safe. Discover has a feature called Freeze It. Visa and MasterCard also gives their banks similar options. Don’t be afraid to protect yourself while you are looking.

12. Sign up for Mobile Banking

Mobile banking is a great fraud fighting tool. If you aren’t using your bank’s app, you’re missing out. More people used mobile than used a bank branch for the first time in 2015, according to Javelin Strategy & Research.

Mobile banking lets you check your account every day for unusual activity. Use of mobile banking can reduce your attack surface, too, since mobile check deposits mean fewer trips to the ATM.

13. Set Text Alerts for Your Credit Card

Banking apps make it easier to use another trick that helps with fraud detection: text alerts. Most banks allow you to set up texts about transactions. Options include: A text with every purchase, a text for every purchase more than $100 or a daily text with the account balance. I prefer the last choice. Anything more frequent and the messages start to feel like spam, and can be ignored. The tool also helps with spending habits, as you’ll have a daily reminder of how much you’ve spent. Most banks can send the alerts via email, too.

14. Report Fraud Immediately

If you are hit by fraud, time isn’t on your side. You will likely be hit repeatedly until the card is canceled. Most importantly, if you don’t report the fraud in a timely manner, you can be held liable for some or all of it. Most of the time, financial institutions are responsive to fraud, and make reporting concerns and getting replacement cards easy, but early detection is critical.

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Financial Advisor Identity Theft Retirement Small Business Uncategorized

How to Create Your Own Retirement Plan

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January 16, 2021 Posted By: growth-rapidly Tag: Financial Advisor

One of the good things of working for a company is that they create a retirement plan for you. As an employee, you don’t have to do anything else but to participate in the plan. However, when you’re self-employed or a small business owner, you’re responsible of setting up your own retirement plan.

When it comes to operating your own business, time is of the essence. However, even if you’re crazy busy, saving for retirement should be a priority. Indeed, a retirement account allows you to contribute pre-tax money, which lowers your taxable income.

Luckily, a financial advisor can help you save time and help you choose the right plan that is best for you. Below are four retirement saving options you can create as a self-employer individual.

1. Solo 401k

A solo 401k is for small businesses or sole proprietors who don’t have any employees other than a spouse working for the business. The solo 401k mirrors a typical 401k plan that most companies offer. The main difference is that you can contribute as an employee and employer.

In other words, because you’re both the boss and the worker, you get to contribute in each capacity. That in turn allows you to contribute a higher amount each year. However, your total yearly contributions cannot exceed $58,000 or $64,000 for individuals age 50 or older as of 2021. To set up a solo 401k, you have to get in touch with a financial institution.

2. SEP IRA

If you’re an independent contractor, self-employed, or has a small business with 25 employees or less you can set up a SEP (Simplified Employee Pension). It’s very easy to establish and don’t even require you to incorporate your business to qualify.

In a SEP IRA, the employer alone contributes to the fund, not the employees. You can contribute up to 25% of your annual salary or $58,000 in 2021, whichever is less.

3. Keogh Plan

Keogh plans are available to self-employed people, including sole proprietors who file Schedule C or a partnership whose members file Schedule E. This type of plan is preferable among those who have a high and stable income.

But the main advantage the Keogh has is the high maximum contribution you can make. In 2021, you can contribute up to $58,000. To set up, you will need to work with a financial institution such as Charles Schwab. 

4. Simple IRA

The Simple IRA was created by the Small Business Protection Act to help those who work at small companies to save for retirement. The small business can offer the plan if it has 100 or fewer employees.

Both the employer and the employee can contribute up to $13,000 in 2021, plus an additional catch-up amount of $3,000 if you’re 50 or older. If a company offers a Simple IRA, it must match an employee’s contribution dollar for dollar, up to 3% of each participant’s annual salary or make a nonelective 2% contribution to all employees.

Where to Invest Your Keogh, SEP IRA, Solo 401k, Simple IRA

As a small business owner, there is always an investment program that suits your needs for your IRA, SEP, Keogh and solo 401k. Places such as banks, brokerage firms and mutual funds institutions such as Vanguard, Fidelity, Charles Schwab are great options. But before opening account, make sure you consider how much money you have, your appetite for risks, the annual fee, etc.

The Bottom Line

If you’re a small business owner or self employed, you should take advantage of the tax benefits offered by these plans mentioned above. Creating a retirement plan is important, because not only will you be able to grow your retirement savings faster but also no one is going to do it for you. 

Related:

Tips on Retirement Planning

Retirement planning can be a major challenge, but you don’t have to go in it alone. Speak with a financial advisor who can help you come up with a unique plan based on your circumstances and situations. Use SmartAsset advisor matching tool to get matched with fiduciary financial advisors in just 5 minutes.

Source: growthrapidly.com

Credit Cards Identity Theft Money

How Safe Are Credit Cards with Chips?

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December 13, 2018 &• 5 min read by Elisa Ortiz Comments 0 Comments

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Payments started with the barter system a long time ago. People exchanged goods or services for other goods or services. Eventually legal tender took over and money, in many forms—from tea bricks to cow to seashells—become the payment method of choice. Then virtual money came on the scene, including credit cards. And today’s credit cards, have chips. Chips, Not to be confused with cow chips from cattle as money are known as EVM or Europay, MasterCard and Visa. EVM is a newer technology intended to protect users and lower the cost of fraud. But, just how safe are credit cards with chips?

The History of Credit Cards

In 1958, Bank of America successfully launched its first credit card, which later became known as the first successful modern credit card. These credit cards were supposed to be a replacement for the cash people carrier around.

Since 1958, credit cards have evolved. And one of the most recent evolutions happened in the U.S. about a year with the addition of a chip or EMV technology on credit cards. Chips replace the previous magnetic strips used on card. A magnetic strip was a black band on the top back of a credit card that relayed information about the payee, such as account number and enabled a merchant to process the payment. With the demise of mag-stripes, that information is passed through the chip.

It’s believed that cards with chips provide a layer of security that wasn’t provided by mag-stripe cards. But, just how secure are these cards and are they right for you?

Magnetic Stripe Technology

The technology of mag-stripe cards dates back 50 years and is similar to the technology used for cassette tapes. Data is loaded onto the mag stripe by the issuer. The stripe is stable and rarely degrades with time.

Whenever you make a payment with a mag-stripe card, the information loaded in the stripe is read over and over again. The down-side is that consistent data is easily stolen by thieves and hackers, because the magnetic field decodes the information and your bank information is then sent.

Thieves can use card skimmers at ATMs and other locations where you pay with your debit and credit card to steal your information. Stopping a thief from using your card information requires that you cancel your old card and get a new one loaded with new account information. But with the same technology, the new card is just as vulnerable as the old one.

EMV Chip Technology: Beneath the Hype

With the newer EMV credit card and debit card chips, the information on the card isn’t static. It’s always changing. It’s consistently decrypted, changed, and re-encrypted, which makes it harder for thieves to steal it. The chip has a mini microprocessor within it that includes a one-time code for every transaction. With a unique code for each transaction, a hacker can’t use the information, because that information was specific to a past transaction.

So, when shopping online or making payment through a physical payment point, the chip on your card sends a signal to the merchant and decrypts the language. Your payment information is then obtained using EMV authentication methods.

The chip also helps ensure that the transaction and the cardholder are verifiable. With mag-stripe cards, this is done by inputting your PIN and your card’s CVV2 or security code.

In essence, your new card contains the same information your old mag-stripe card had, but the chip offers better security as it constantly generates new encrypted information, providing an extra layer of protection that mag-stripe technology couldn’t offer.

So the answer to “how safe are credit cards with chips,” is that they are safer than older card technologies.

Regardless of the added security with EMV chips, identity thieves will always attempt to steal your information in a bid to gain access to your money. So, it’s still important to take steps to protect your finances, pay for goods safely and avoid getting robbed.

Here Are a Few Ways to Keep Your Chip Credit Card Safe

1. Protect your numbers

Never tell your credit card number or PIN to anyone. With any of these numbers, it’s easier for a theif to gain access to your account and your money. If possible, sign for transactions instead of using your PIN. This way if a false transaction happens, the blame rests on either the bank or the merchant. And never send your account number or PIN in an email, text message or social media.

2. Keep track of your bank statements

Banks are diligent in stopping fraud and preventing fraudulent activity before it happens. Several banks notify customers of an attempted unauthorized use of their debit card at suspicious locations, while other banks flag suspicious transfers and call customers immediately.

Thanks to the extra security made possible with EMV technology cards, it’s not as easy for thieves to steal information. However, it’s still important to review your bank statements regularly in order to spot suspicious transactions. If you find any of these, report the discrepancies to your bank immediately.

3. Choose alternative payment methods

A great way to ensure the safety of your information is to give preference to retailers and vendors using mobile payment technology. Doing this significantly reduces the risk of thieves stealing your information. You can also add your debit and credit cards to your phone, use mobile-friendly payment terminals to ensure your shopping experience is secure. You might also consider investing in identity theft protection.

4. Keep an eye on your credit score

Watching your credit score—not obsessively—but judiciously, can help alert you to changes in your credit, which can indicate that your account information or identity has been compromised or that you’ve had fraudulent charges made. On Credit.com, you can sign up for free access to your Experian credit score. On Credit.com, your score is updated every two weeks. And you get access to a free credit report card so you can see what steps you want to consider to keep your credit good or maybe make it better.

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Identity Theft Money Taxes

Don’t Get Tricked: Identity Protection Tips You Need

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October 22, 2020 &• 7 min read by Eva Velasquez Comments 0 Comments

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The weather is turning, fall is in the air, and Halloween is around the corner—which means it’s National Cybersecurity Awareness Month. How can you ensure October is full of treats while not falling for any scammers’ tricks? By arming yourself with these identity protection tips.

Every American should understand the basics of identity theft protection. According to the most recent report by the Bureau of Justice Statistics, 10% of people 16 and older have been the victim of identity theft. That’s why we’re encouraging people to educate themselves on identity protection tips this autumn. After all, there’s nothing quite as scary as identity fraud!

Here are some identity theft tricks to watch out for and identity security treats to take advantage of.

Trick: Using Your Data to Open New Accounts

According to the FTC, credit card fraud—including opening new credit card accounts—was the most commonly reported form of identity theft in 2019. Thieves can rack up hundreds of dollars’ worth of bills before you know it happened.

Here are a few things to keep in mind when it comes to your cybersecurity to avoid your data being used to open new accounts in your name:

  • Never use the same password across multiple accounts. Switch your passwords up.
  • Never use a password that’s easy to guess. This includes passwords that include your birthday, first or last name, or address.
  • Use passwords that are random combinations of numbers, letters, and symbols.
  • Enable two-factor authentication whenever it’s offered.
  • Don’t share or write down your passwords.
  • Never click on unknown email links or pop-ups on websites.
  • Make sure websites are secure before entering your payment information.
  • Never connect to public Wi-Fi that isn’t secure.
  • Never walk away from your laptop in public places.
  • Enable firewall protection.
  • Monitor your accounts and credit reports for unusual activity.

Treat: Check Your Credit Reports

Identity theft protection starts by being proactive and regularly monitoring your information for suspicious activity. That includes monitoring your credit report.

Did you know that you’re entitled to one free copy of your credit report each year from all three credit reporting agencies? In honor of National Cybersecurity Awareness Month, make October the month that you request your reports and go over them with a fine-toothed comb. Make sure you recognize all the open accounts under your name.

[Note: Through April 2021, you can review your credit reports weekly.]

An added bonus of checking your reports early in the month is that you can give your credit a good once-over before the upcoming holiday shopping season. Unexplained dips in your credit score could be a sign that something is wrong.

When you request your free credit report from the credit bureaus, your report does not come with your credit score—you have to request that separately. Sign up for ExtraCredit to get 28 of your FICO® scores and your credit reports from all three credit bureaus. You’ll also get account monitoring and $1 million identity theft insurance.

Trick: Charity Fraud

October also happens to be Breast Cancer Awareness Month, and everywhere you look, pink is on display. With so much national attention on breast cancer, it’s easy to fall for scams that claim to be legitimate charities.

Consumers should also be on the lookout for phony COVID-19 related scams this fall and winter. For example, watch out for fake charities that pretend to provide COVID relief to groups or families but are simply stealing money.

Even worse than handing over money to these heartless fraudsters is that you may have handed over your credit card numbers or other personally identifiable information in the process.

Treat: Know Your Worthy Causes

Before donating to a charitable cause, do your homework. You can use websites such as Charity Navigator, CharityWatch, and the Better Business Bureau’s Wise Giving Alliance to check a charity’s reputation. Additionally, consider contacting your state’s charity regulator to confirm the organization is registered to raise money in your state.

After you’ve verified the status of the charity, consider making donations directly through the national organization. Avoid giving money or financial information directly to someone that reaches out to you through email, phone calls, or door-to-door interactions.

It might be a bit of extra work, but at the end of the day, you can feel good knowing your money is going to support a real cause. If you want to support October’s Breast Cancer Awareness Month, consider donating directly on the national website. An added bonus is that you’ll receive a receipt you can use for tax deduction purposes.

Trick: Tax Refund Fraud

Every year, the Internal Revenue Service announces its “dirty dozen” scams. These are the tax fraud scams the IRS determines to be the most common for the year. The 2020 list includes refund theft. A tax thief gains access to your information, files a fraudulent return in your name before you do, and has the funds paid out them. The only way you find out about it is that your legitimate tax return—the one you submit—is rejected for having already been filed.

Another way individuals fall victim to tax refund fraud is by using an unscrupulous return vendor. Dishonest vendors and ghost preparers steal personal information to file a tax refund and pocket the money or use that information for other types of identity fraud.

It’s unclear what exactly the next round of stimulus legislation will include, but if another stimulus check is included, watch out for attempts to steal your COVID stimulus checks. Remember that the IRS never contacts you via email, social media, or text.

Treat: File Early

It may feel like you just finished filing your 2019 taxes, but it’s never too early to start preparing for next year. While filing your taxes might be the last thing you want to think about this month, it’s crucial to stay on top of your tax return documents so you’re ready to file as early as possible. This is especially true for individuals who have reason to believe that their personal data has already been breached.

Always ensure you work with a reputable tax return vendor. You can look at the vendor’s online reviews before considering them as an option for tax return help.

Additionally, individuals that are paid to assist with or prepare federal tax returns must have a Preparer Tax Identification Number (PTIN). Paid preparers must sign and include their PTIN on returns. Always ask for this number before you hire an individual and hand over your personal information.

If you file early, you can beat out someone filing before you and receiving your return first. The earliest you can file is January.

Trick: Social Media Scams

Our social media accounts allow us to stay connected with friends and family. Unfortunately, scammers understand this and have started using social media to commit identity fraud.

There are many variations of social media phishing scams, but the basics are generally that a scammer creates an account to gain your trust and gather personal information from you. For example, many people have their name, birthday, and workplace information on their Facebook or other social media account. Those three things alone could be enough for someone to gain everything else they need to create a credit card application under your name or access your existing accounts.

Treat: Be More Exclusive and Private

Consider taking a quiet October morning to comb through your social media accounts. Start with your followers. Consider deleting everyone you don’t know personally.

If a follower base is important to you, consider another approach. Go through each social profile and scrub any personal details. Change the spelling of your last name slightly, delete your birthday, and remove other personal information, such as place of work. Ultimately, this can reduce the risk of being an easy target for identity fraud.

These core identity protection tips should help you stay safer online. With COVID-19 causing people to feel scared, individuals are more vulnerable to being tricked. Remember that identity fraud happens to millions of people every year, and it’s important to remain vigilant.

Stay Vigilant This Fall

Identity theft can have long-lasting consequences. If you’re recovering from identity fraud or simply unhappy with your credit score, consider signing up for ExtraCredit. ExtraCredit is a five-in-one credit product that provides tools to helps you build, guard, track, reward, and restore your credit.


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Financial Advisor Financial Planning Identity Theft Personal Finance Retirement

5 Reasons You Need To Hire A Financial Consultant

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October 26, 2019 Posted By: growth-rapidly Tag: Financial Advice

If you’re a busy individual and have no time for the day-to-day management of your money, you may need to consult a financial consultant.

Beyond being busy, however, there are major turning points in your life where working with a financial consultant is absolutely necessary.

For instance, if you’re approaching retirement, you’ll have to figure out how much money you need to live during your non-working years.

So what is a financial consultant? And what do financial consultants do? In this article, we’ll run you through situations where financial consulting makes sense.

We’ll show you where you can get a financial consultant that is ethical and who will act in your best interest, etc.

Of note, hiring a financial consultant is not cheap. A fee-only financial advisor can charge you anywhere from $75 to $300 per hour. If your situation is simple, you may not need to hire one.

However, hiring a financial consultant in the situations discussed below is worth the cost.

Related: 5 Mistakes People Make When Hiring A Financial Advisor

What is a financial consultant?

A financial consultant is another name for financial advisor. They can advise you on a variety of money subjects.

They can help you make informed decisions about managing your investments and help you navigate complex money situations.

Moreover, a financial consultant can help you come up with financial goals such as saving for retirement, property investing and help you achieve those goals.

To get you started, here’s how to choose a financial advisor.

5 Reasons You Need To Hire A Financial Consultant:

1. You have a lot of credit card debt.

Having a lot of credit card debt not only can cause you severe emotional distress, it can also negatively impact your ability to get a loan (personal loan or home loan).

For instance, if you see 50 percent of your income is going towards paying your credit card debt, then you need professional help to manage debt. Your best option is to find a financial consultant.

Luckily, the SmartAsset’s matching tool is free and it helps you find a financial consultant in your area in just under 5 minutes. Get started now.

2. You are on the verge of bankruptcy.

If you have way too much debt and can’t seem to pay it off within a reasonable time, another option for you is to file for bankruptcy.

Although bankruptcy will free you from most of your debts, avoid that option if you can.

One reason is because it can have a long, negative impact on your credit file. Once you go bankrupt, the bankruptcy will be on your credit report for a long time.

Working with a financial consultant can help you come up with different strategies. They may advise you to consider debt consolidation, which can significantly lower interest rates.


Speak with the Right Financial Advisor

You can talk to a financial advisor who can review your finances and help you reach your goals. Find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.


3. You’re ready to invest in the stock market.

If you’re thinking about investing in the stock market, then the need for a financial consultant is greater. Investing in the stock market has the potential of making you wealthy.

But with great returns come great risks. The stock market is volatile. The price of stock can be $55 today, and drops to $5 the next day.

So, investing in the stock market can be very intimidating. And if you’re a beginner investor and unsure about the process, it is wise to chat with a financial advisor to see if they can benefit you.

A financial consultant can help build an investment portfolio and help manage your investments.

4. You’re starting a family.

If you’re just got married seeking a financial consultant is very important. A financial advisor can help you figure out whether you should combine your finances, file taxes jointly or separately.

You also need to think about life insurance as well, in case of death of one spouse. And if you’re thinking of having kids, you need to think about saving for college to ensure the kids’ future.

Turning the job over to a financial consultant can save you a lot of money in the long wrong and is worth the cost.

Related: Do I Need A Financial Advisor?

5. You’re just irresponsible with money.

If you make emotionally based financial decisions all of the time, you’re buying things without planning for them, you may be irresponsible financially and therefore need professional advice.

If you’re spending money on expensive items when you could be planning and saving for retirement, then you may need a financial consultant.

You may find yourself having trouble saving money. Then it may make sense to speak with a financial advisor.

Speak with the Right Financial Advisor For You

You can talk to a financial advisor who can review your finances and help you reach your goals (whether it is making more money, paying off debt, investing, buying a house, planning for retirement, saving, etc). Find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.

Source: growthrapidly.com