by Susan Sharkey, HSFPP Senior Director
NEFE Nudge: Consumer fraud is the fastest growing crime in the U.S. so it pays to apply defensive consumer strategies to minimize risk, financial loss and the time spent handling reparation.
Defensive Driving Lessons and Defensive Consumer Tactics
In drivers’ education courses, we are taught to drive defensively and watch for careless drivers — as well as anything else that might appear unexpectedly on the road. That training was especially relevant when I lived in Wisconsin and Minnesota, where one had to be vigilant to avoid contact with deer that periodically would dart across one’s path. What does this have to do with identity theft? More than you might think.
Both scenarios call for alertness to conditions that could lead to potentially costly and time-consuming inconveniences, including reporting mishaps and repairing damage. I am distrustful when put into a suspicious situation, whether scanning the road and shoulder to spot deer lurking in the shadows of trees, or skimming my inbox for unsolicited emails requesting my account information.
In both cases, I apply safeguards within my control. I sound my car horn to ward off deer from crossing the road at dusk, and I shred discarded mail and paperwork at home to deter theft of financial data or access to my account information. If something does happen — whether it’s a deer or fraud mishap — I act swiftly to file relevant reports and repair damage so my life returns to normalcy as soon as possible.
In 2016, State Farm Insurance reported the odds of hitting a deer while driving in Wisconsin to be 1 in 77 drivers. With those odds, it seems only a matter of time before I would have a deer-auto incident. Similarly, it is not a matter of if identity fraud will happen; rather, it is more likely a matter of when it will happen.
Data from the Javelin Strategy and Research 2017 Identity Fraud Study revealed that 2016 saw the highest number of victims -- 6.15 percent of consumers (15.4 million) – reporting nearly $16 million in losses due to identity fraud. Consumer fraud is the fastest growing crime in the U.S., costing twice as much as property crime, according to the U.S. Bureau of Justice and Statistics. In addition to victim costs, many hours are spent filing reports with police and creditors, verifying and fixing account information, replacing lost items and conducting investigations.
Much like defending against deer collisions, defensive tactics can and should be applied to minimize damage caused by fraud. Whether or not you or a family member have been a victim of identity fraud, be aware of sensible precautions and credible resources to protect against and remedy circumstances of fraud.
Defensive Consumer Tactics
- Be suspicious. A missed opportunity or an opportunity to report a miss? In the past month, I’ve received several suspicious spam emails attempting to lure me to “verify my account details.” It surprises me that the same types of scams continue year after year. It must be lucrative for thieves to make the effort to bait potential victims.
Remind family and friends to protect their financial data from theft by verifying credentials before conducting online or in-person interaction that involves sharing personal information, financial data or an expenditure, especially when the other party initiates communication. If you did not initiate a call, email or door-to-door inquiry sales pitch, that is a big red flag. You always have the right to take time to verify credibility before exchanging information or money. Often, the best response is no response at all.
As advised by representatives of state attorney general offices, I not only avoid responding to suspicious messages, but I report these emails via the Federal Trade Commission (FTC)’s online Complaint Assistant. A complaint also is filed with my state’s attorney general office. Individual cases might not be investigated, but collecting details of multiple, similar occurrences can help officials detect patterns that could lead to investigations. Key go-to resources to find easy-to-understand tips for protecting against and detecting fraud include the FTC online consumer information and your own state attorney general office, such as Colorado’s Stop Fraud Colorado online toolkit.
- Be alert and deploy safeguards. Monitor your account details for any suspicious or unauthorized activity. Sign up to receive automated account alerts to monitor credit card or banking activity. Limit who has access to your data. Avoid accessing any of your online financial accounts while using public Wi-Fi. Use strong passwords and frequently change those passwords. Only share personal data in situations that are required, such as opening a bank account or applying for a loan. Carry only the credit card and personal data you need at the time.
Be especially protective of your Social Security number. If requested on a form, find out why it is needed and how it will be used before deciding whether or not to share it. Be aware of the information you share via social media that might provide potential security clues for would-be thieves. The FTC has an extensive list of fraud protection tips as well as alerts and descriptions about current scams.
- Remedy fixes promptly.To date, my family members have fallen victim to only a few minor unauthorized credit card charges that quickly were rectified following credit card company standard procedures. On two instances, the card company notified the cardholder within hours of the incident, before the cardholder detected it. Although company representatives have apologized for the inconvenience of locking down my credit cards due to unusual charges, I have thanked them for taking the extra precautions on my behalf.
A family acquaintance had a more complicated dilemma after she discovered that her wallet had been cleverly removed from her zipped, cross-body purse while out for an evening with friends. Although the discovery was made after business hours on a weekend, her friends had the knowledge (learned from their personal finance teacher) to prompt her into quick action.
They utilized checklists from FTC’s IdentityTheft.gov website to guide the victim through recovery steps. Within a few hours of the discovery, she inventoried what was missing, checked her account activity and uncovered several unauthorized charges, notified her credit card companies to close her accounts and issue new cards, filed a police report, and contacted the Department of Motor Vehicles to report her stolen driver’s license. This wasn’t how she had planned to spend her weekend, but she was able to have the unapproved credit card charges removed and the stolen items quickly replaced, minus the wallet and a small amount of cash.
In case you were wondering, my family wildlife collision report currently stands at two deer, one turkey (coincidentally on Thanksgiving Day), two opossums, a moose, and the related deductible costs for auto repair. Miraculously, all critters stumbled away from the respective crash sites, and no humans suffered injuries. In comparison, our family’s identity fraud statistics involve no physical harm, nominal monetary loss to replace stolen ID cards, and a few hours to handle account notifications.
- Self-assess how well your defensive consumer habits stack up. Detect suspicious circumstances, deploy safeguards and quickly respond to fraud episodes.
- Tour online consumer fraud information shared via the Federal Trade Commission and your state’s attorney general office to become familiar with fraud trends, protective strategies and ways to handle incidents.
- Inform others, especially reminding social media enthusiasts to be selective about the information they share online that might be tempting to thieves.
- If you encounter something suspicious, report it to the Federal Trade Commission.