Identity theft is an ever-increasing cause of a bad credit rating. We answer some of the most common questions people have about identity crime and explain how it can affect your credit file. By GRAHAM DOESSEL CEO of MyCRA Credit Repairs and www.fixmybadcredit.com.au.
8 Most Common Questions about Identity Crime Answered
1. Who is affected by identity crime?
It is reported that 1 in 6 people in Australia is a victim or knows someone who has been a victim of identity theft or fraud in the past 6 months.
Victims are not always ‘gullible’ as may be the impression in the wider community. Many experts say it is not a matter of if you experience an identity theft attempt, but when.
2. Who commits identity theft or fraud?
It can originate from someone you know – for example an acquaintance obtains identity documents or credit card details to impersonate you. Or more increasingly it comes from professional fraudsters whose main occupation is to steal personal information and financial details in order to commit fraud.
3. Where does identity theft originate?
Fraudsters are after your personal information. The internet is a big source of personal information and its ever increasing use makes you more vulnerable to identity crime than ever. This means identity crime can have very long arms – often it originates from overseas crime syndicates. Social networking, online banking, company databases and email scams can all be havens for today’s cyber- criminal.
You can also fall victim to a number of rampant telephone scams, credit card skimming, or criminals can also take to going through your rubbish bin for anything they may be able to use to steal your identity.
4. Why is identity theft increasing?
The pay-offs are huge for criminals. It is estimated identity crime costs Australians $1 billion a year.* In cyber circles alone, world estimated costs for cybercrime are staggering.
Cyber-crime expert Mischa Glenny says that while there are no precise figures out there, the White House suggested in 2009 that cybercime and industrial espionage inflicts damage of around U.S.$1tn per year, which is almost 1.75% of GDP.
“Traditional bank robbers must be absolutely gobsmacked when they hear sums like this being hoovered up by cyber-criminals week in, week out,” he says.
5. How can I be affected by identity crime?
We consider if someone is alerted to having money stolen from credit cards early, or perhaps is able to call their bank and stop fraud in its tracks – that they are the lucky ones.
The unlucky identity theft victim is unaware of the fraud until their identity is misused, and their credit rating with it. When identity theft damages your credit rating – it is because the fraudster has been able to overtake credit accounts, or has gained access to enough personally identifiable information about you to forge new identity documents.
This gives the fraudster access to credit cards, loans, even mortgages which allows them to extract significant amounts of money without you realising it straight away.
If credit accounts are not repaid – after 60 days you may be issued with written notification of non-payment and the intention for the creditor to list a default on your credit file. It is at this moment that some people who were previously unaware of any problems find out they have been victims of this more sophisticated type of identity theft.
But often the credit file holder has also had their contact details changed – and this means it is not until they apply for credit in their own right and are refused that they find out about the identity fraud. This can be a significant time after the initial crime.
6. When would I know if I have been a victim of identity theft?
Some signs to watch out for include:
Strange unaccountable withdrawals on credit or personal bank accounts. It may not need to be a big amount to indicate fraud. Many criminals do ‘test’ amounts to begin with before extracting more significant amounts.
Phone calls or emails from what often appear to be legitimate companies, asking for money or personal details. If you have given bank details or personal information in this way either online or on the phone there is a high chance it was a scam. Verify with the company in question.
Can’t log in to social networking or bank accounts.
Credit refusal
Bills or letters of demand sent to you for accounts you don’t know about
Missing mail – particularly credit card statements which could indicate someone has overtaken your accounts. In this case no news is not good news.
7. What can I do if I suspect I am a victim of identity theft?
Notify Police immediately. Many people do nothing due to embarrassment, or because they don’t believe the fraud was significant enough. But is only through this crime getting reported that statistics get collated, and we start to have any chance of catching the criminals.
Notify creditors. You may need to cancel credit accounts.
Obtain a credit report. This report is free once per year for every Australian who holds a credit file. It will indicate to you whether any of your contact details have changed, or whether there have been credit enquiries on your account. If you act quickly enough, you may be able to stop your credit rating from being affected by black marks which would come from fraudsters obtaining credit in your name.
Notify credit reporting agencies of the possible fraud. They will be able to put an alert on your credit file.
Police may assist you in obtaining a Victims of Commonwealth Identity Crime certificate, if they believe you are eligible. You can apply to a magistrate in your State for this certificate, which may help in recovering your credit rating or credit accounts. Victims need to have had a Commonwealth Indictable Offence committed against them. For more information, visit the Attorney-General’s website www.ag.gov.au.
8. What steps can I take to prevent identity theft?
– Keep virus software up to date on your computer. Install automatic updates and perform regular virus scans.
– Keep your privacy settings secure on all social networking sites.
– Keep passwords and PIN numbers secure. Don’t carry PIN numbers with your credit/debit cards, change passwords regularly and use a variety of passwords for different purposes.
– Check all your credit card and bank statements each time they come in.
– Cross-shred all personally identifiable information which you no longer need.
– Buy a safe for your personal information at home.
– Do not give any personal information or credit card details to anyone via phone or email unless you are sure the site is secure, and or you can verify the company details.
– Be aware of who gets our personal information and for what purposes. What can these people do with the information they are gathering? For instance, is it really necessary for the site you are registering on to have your date of birth?
– Keep up to date with the latest scams by subscribing to the government’s ‘SCAM watch’ website. For a list of ways your computer can put you at risk, visit the governments Stay Smart Online website www.staysmartonline.gov.au.
– Check your credit file regularly.
If you or someone you know needs help recovering their credit rating following identity theft, contact MyCRA Credit Repairs, www.mycra.com.au or call tollfree on 1300 667 218 for confidential advice and help restoring your good name.
* OECD Committee on Consumer Policy, Online Identity Theft, February 2009, p. 37
Image: Salvatore Vuono / FreeDigitalPhotos.net
Personal information has become a valuable commodity in cybercrime circles. It can be extracted, abused and traded for identity theft purposes and to take advantage of someone’s good credit rating. And as many older Australians are finding out – it can also be pilfered to make some crook wealthy through hijacking Super Funds – without the victim knowing a thing about it.