National Consumer Protection Week: Preventing identity theft

ID-10074457Identity theft is one of the most common crimes to strike consumers–and the crime is growing more frequent. As part of National Consumer Protection Week, your BBB is shedding light on ways to protect yourself.

There were more than 28,000 reported cases of identity theft in Texas alone in 2012, according to the Consumer Sentinel Network report issued by the Federal Trade Commission. The report also ranked Texas fifth in the nation for the most reported cases of identity theft per 100,000 residents.

Fraudsters actively seek to gain access to your personal information.  Nowadays, when your purse or wallet gets stolen, the cash inside may not be the only thing a thief wants to steal. The most valuable items in your wallet are your Social Security number, ATM card, credit cards, bank checks and any other items containing your personal information. Once they assume your identity, scammers can conduct transactions in your name.

Identity left has many forms, from phishing to dumpster diving. Scammers will go to great lengths to get hold of your name and personal information. During the course of a busy day, you share this information when making transactions in person, over the telephone and online to buy goods and services. If it falls into the hands of a criminal, it may be used to steal your identity.

BBB offers advice for keeping your identity safe from scammers:

  • Shred all offers you receive in the mail.
  • Never put your social security number on a personal check.
  • Never sign a blank credit card receipt.
  • Check out a business first with Better Business Bureau (BBB).
  • Keep records of all credit card numbers in a locked secure place.
  • Unless you are directly related to a person, never co-sign a loan application for anyone.
  • Never write your credit card number or personal information on the outside of an envelope or postcard.
  • Never provide personal information over the phone, unless you know who you’re talking to.

The best way to prevent being taken advantage of is to limit accessibility to your information, both online and in print. Shredding documents after they are no longer needed can decrease the risk of identity theft.

BBB advises consumers have a document retention schedule. Here are some guidelines for how long you should keep personal documents:

  • Insurance documentation: Keep everything as long as you have the policy. Also, save any paperwork regarding unresolved claims/coverage.
  • Keep utility, cell phone and similar bills only until you receive confirmation that your payment has been processed. The only exception to this is if you are self-employed. Self-employed people should keep these records longer so they can prove any deductions on their tax forms.
  • Loan documentation: Keep all paperwork until you pay off the loan. Then, you can shred everything except the document that proves you paid in full.
  • Monthly bank statements: Find out how much time your bank and/or credit cards give you to challenge incorrect statements. Keep them until you are no longer able to challenge them. This is typically between 60 days to one year after the mistake is made.
  • Keep one year:
    • Paycheck stubs: Don’t throw away your paycheck stubs until you receive your annual W-2 form from your employer. If everything matches, shred your pay stubs. Then, keep your W-2 forms for at least a few years.
  • Keep three years:
    • Bank statements
    • Expired insurance policies
  • Keep seven years:
    • Tax returns, canceled checks/receipts, records for tax deductions taken. The IRS has six years to challenge your return if it thinks that you underreported your gross income by 25 percent or more.
  • Keep forever:
    • All paperwork related to bankruptcy, inheritance and wills.
    • Auditor’s reports.
    • House/Condominium records: It is a good idea to keep documents of expenditures related to house/condominium improvements. Capital purchases that improve or enhance the value of your home when you sell your property may lower your capital gains tax.
    • IRA contribution records: If you made a nondeductible contribution to an IRA plan, such as a Roth IRA, keep your records to show that you were already taxed for this money.