Tag Archives: identity theft

Sep 24 2014

Data Breaches and Credit Freezes

News reports of large-scale data breaches–like the September 2014 announcement from Home Depot–have prompted many people to consider a credit freeze.  Also known as a security freeze, this tool lets you limit access to your credit report, which makes it more difficult for identity thieves to open new accounts in your name.

Remember, credit freeze doesn’t prevent a thief from making charges to your existing accounts.  Even if you elect a credit freeze, you still must monitor your existing credit card and bank accounts for charges you don’t recognize.  Also, remember that you can check your credit reports for free, every few months by visiting AnnualCreditReport.com or calling 1-877-322-8228.

For additional information, go to

http://www.consumer.ftc.gov/blog/data-breaches-credit-freezes-and-identity-theft-oh-my?utm_source=govdelivery

Teaching suggestions

You may want to use information in this article to discuss

  • The difference between a credit freeze and a fraud alert.
  • If anyone can see your credit report, is it frozen?

Discussion Questions

  1. Does a credit freeze affect your credit score?
  2. Does a credit freeze stop prescreened credit offers?
  3. How can you place a freeze on your credit report and how do you lift a freeze?
Sep 10 2014

Home Depot Data Breach May Top $50 Million

“Home Depot spokeswoman Paula Drake said ‘protecting our customers’ information is something we take extremely seriously.’” 

At the time of this blog, it is not clear how many Home Depot stores or shoppers were involved, but this breach could be one of the largest data breaches to ever hit a retailer.  It is also estimated that the cyber thieves made an estimated $50 million from this breach by selling credit card numbers and personal information.

Home Depot and many other retailers including Target, P. F. Chang’s, Neiman Marcus, and other companies, have all experienced similar data breaches in recent months.  To combat this problem, many companies are beginning to use a new “chip and pin” technology.  Already in use in Europe, the new technology contains a chip in your credit or debit card with account information, requires the user to use pin identification, and is nearly impossible to counterfeit.  Because the new technology has dual verification, card transactions are much, much safer for both retailer and customer.

For more information go to http://www.cbsnews.com/news/home-depot-data-breach-may-top-50-million/

Teaching Suggestions

You may want to use the information in this blog post and the original article to

  • Stress the importance of students monitoring credit and debit card activity on a regular basis.
  • Obtain a credit or debit card with the new chip and pin technology.
  • Encourage students to determine their liability if their credit or debit card information is stolen.

Discussion Questions

  1. Assume you are trying to decide between two different credit cards. One card does not have chip and pin technology and does not charge an annual fee.  The other card does have chip and pin technology, but charges an $85 annual fee?  Which card would you choose?  Explain your answer.
  2. Besides choosing a credit or debit card with chip and pin technology, what other steps can you take to make sure you are not a victim of identity theft?
Jul 16 2014

Text Message Spam

Spam text messages are not only annoying but also illegal. Many con artists use text messages to obtain your personal information by offering a free gift card or vacation. As a result, you become very vulnerable to identity theft.

To avoid becoming a victim of text message spam, register your number on the Do Not Call List.  Also, never click on links in spam messages, which often carry malware or send you to fake websites.

Never reply to these text messages or give out your personal information.  Report the text spam to your cell phone carrier by forwarding the message to 7726 (SPAM).

You can report unwanted commercial text messages and other complaints related to consumer fraud to the Federal Trade Commission at https://www.ftccomplaintassistant.gov/#crnt&panel1-1

For additional information on text message spam, go to:

http://blog.usa.gov/post/89152807112/protect-yourself-from-text-message-spam

http://www.consumer.ftc.gov/articles/0350-text-message-spam

Teaching Suggestions

  • Have students conduct research to obtain information on various types of scam and frauds.
  • Have students create an in-class presentation or a video communicating actions to take to avoid becoming a victim of consumer fraud.

Discussion Questions 

  1. Why do some people easily become victims of text message spam and other consumer frauds?
  2. Describe various types of frauds and scams.
  3. What actions can be taken to avoid becoming a victim of consumer fraud?

 

Jun 21 2014

What Eight Numbers Do Identity Thieves Want?

This article explains why identity thieves want eight different numbers and also provides some helpful tips for avoiding identity theft. The eight numbers include:

1. Phone numbers
2. Specific dates (birth, college attendance, employment, etc.) and Zip Codes
3. PIN Codes
4. Social Security Numbers
5. Bank Account Numbers
6. IP Address
7. Driver’s License and Passport Numbers
8. Health Insurance Account Numbers

For more information go to

http://finance.yahoo.com/news/8-numbers-identity-thieves-want-103033107.html

Teaching Suggestions

You may want to use the information in this blog post and the original article to

  • Stress that identity theft is on the rise. According to the article, data breaches are now the third certainty in life and sooner or later, you will become a victim.
  • Ask students who have had their identity stolen what steps were necessary to solve the problems associated with identity theft.

Discussion Questions

1. What have you done to protect the eight numbers that thieves want and need to steal your identity?

2. Today many companies offer services designed to help protect your identity. These companies charge from $100 to $200 a year or more. Would you consider using one of these services?

Jun 4 2014

Bogus $10,000 Credit Line

In May 2014, the Federal Trade Commission mailed checks totaling over $3.7 million to over 26,000 consumers whose bank accounts were debited without their consent by EDebitPay LLC.  The company deceptively offered a $10,000 credit line that was really a membership to a website where consumers could buy goods.

In 2011, a federal district court ordered the company to pay more than $3.7 million after finding that the defendants were in contempt of court for violating a 2008 court order by selling a bogus “$10,000 credit line”, and a “no cost” prepaid debit card with hidden fees, to consumers who were unemployed or had poor credit.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them.

For additional information on fraudulent business practices, go to

http://www.ftc.gov

Discussion Questions

1.  How do you discover that someone has debited your bank accounts?

2.  What steps can you take to prevent such fraudulent business practices?

Teaching Suggestions

*  Ask students what actions might they take to ensure that their credit cards and other financial information are secure.

*  Ask students to compile a list of resources a person can use to report such fraudulent business practices, and check out a company’s reputation before signing a contract.

May 15 2014

Protect Your Personal Information and Money

Recent reports about thieves gaining access to sensitive personal information that can be used to commit fraud or steal money, sometimes involving major security breaches at large retailers such as Target stores.  While federal laws and industry practices generally limit losses for unauthorized transactions involving bank accounts, debit and credit cards, it pays to be proactive.

Be careful when you use social networking sites.  Scammers use social networking sites to gather details about individuals, such as their place or date of birth, a pet’s name, their mother’s maiden name, and other information that can help them figure out passwords–or how to reset them.  Even small amount of information can help them steal your identity, such as by answering security questions that control access to accounts.  According to Michael Benardo, Chief of the FDIC’s Cyber Fraud and Financial Crimes Section, “Don’t share your ‘page’ or access with anyone you don’t know and trust.  Criminals may pretend to be your ‘friend’  or relative to convince you to send money or divulge personal information.”

For additional information and tips on avoiding fraud at social media sites, go to the Internet Crime Complaint Center at

http://www.ic3.gov/media/2009/091001.aspx and http://www.fdic.gov/consumers/consumer/news/cnfall13/socialmedia.html

Discussion Questions

1.  What can you do to guard against scams involving fraudulent requests to wire money or send a prepaid card?

2.  Why should you be suspicious about unsolicited emails or text messages asking you to click on a link or open an attachment?

Teaching Suggestions

You may want to use the information in this blog and the websites to

*  Discuss the importance of regularly reviewing your transactions in your credit card and bank statements.

*  Carefully choose user IDs and passwords for your computers, mobile devices, and online accounts.

*  Periodically review your credit reports to make sure someone else has not obtained a credit card or a loan in your name.