How to stay safe after the Equifax data breach

Equifax disclosed last week that the personal financial information of up to 143 million users had been exposed in a massive hack last July. This represents roughly two-thirds of all credit card holders, so you may be affected.

The delay in disclosing is troubling, and the hack raises questions about oversight of the credit bureaus and even about the impact on their management. We can see the impact on investors: the Equifax share price has dropped over 20%

While we can discuss these issues and more, the priority is shoring up your personal credit.

Impact

Was your data taken? There are links from Equifax, Norton and others where you can attempt to determine the impact on you personally. However, these sites seem to default to “you may be affected,” even if you put in bogus information.

The good news is that Equifax has responded to consumer pressure to make certain services free.

Act now

You will want to act as soon as possible to keep your financial information safe.

“There are so many entities who need to check your credit: when you’re renting an apartment, getting insurance, a new cell phone, utilities,” Liz Weston, a financial planner and columnist at NerdWallet, told BuzzFeed News. “But at this point the breach is so great” that taking measures to safeguard your identity is worth it. She recommends instituting credit freezes.

Equifax free service – sign up on line for the complimentary service being provided by Equifax, which provides the following:

  • three-bureau credit file monitoring with alerts,
  • credit report lock,
  • scanning of suspicious sites for use of your social security number,
  • Equifax credit reporting, and
  • $1 million identity theft insurance covering certain out-of-pocket expenses.

Monitor your cards – review your monthly credit card, bank and loan statements for suspicious activity. You have a right to free credit reports so obtain them and review for unauthorized activity.

Also, watch for unexpected calls or mail, such as debt collectors or people posing as IRS agents, because these may be signs that your information may be in the hands of thieves.

Credit freeze – request a freeze on your credit from all three agencies: Equifax, TransUnion, and Experian. Equifax will not charge you but the others will.

Requesting a credit freeze prevents thieves from using your identity to get loans or credit cards in your name, even if your personal information was compromised by the hack. You essentially pay to bar each of three credit reporting agencies — Equifax, TransUnion, and Experian — from providing a credit report without both your explicit permission and a personal identification number (PIN) that temporarily lifts the freeze. (Freezes do not affect financial institutions or companies you have an existing relationship with, only new ones.)

Make sure to place the freeze with all three bureaus and to keep your PINs for unlocking the freezes in a safe place.

“A credit freeze with only one bureau is incomplete protection,” Mike Litt, the consumer program advocate at the US Public Interest Research Group, a consumer group, said. Consumer experts recommended getting a freeze with all three agencies.

There are companies such as LifeLock that provide bundled services. If cost is not an object, that may be the best course of action. Here is the Lifelock response on Equifax.

Fraud alert – if you are certain that your information has been taken, place alert all three credit bureau websites. You can access the TransUnion site here. Some protection is free, but their premium package costs $9.95

If you are the subject of identity theft, there are many resources now that help you report and recover. The Federal Trade Commission website can help devise a recovery plan to implement.

PINs and passwords – the passwords and PINs you use could be the next issue. You may want to change what you use now and update annually, if not more often.

Updates – Equifax continues to provide updates on the status of the hack and their response.

And news sites continue to report on the hack – see this NY Times article.

Summary

There are many steps to take, and the information taken may not be used for some time. So, you will want to take some if not all the steps outlined above. If you have trouble doing so, or if you have questions, let us know.

And for more reading, the Better Business Bureau is one resource for tips on avoiding scams. And, the FTC is a good resource for identity theft.

Good luck and stay safe!

Be wary of these scams – IRS and investments

It seems that we hear of a new internet or phone scam on a weekly basis. These scam artists are getting bolder and more sophisticated with each new endeavor. So, we wanted to alert you to a few new ones where the scammers are pretending to be IRS agents and financial planners.

**Taxpayer Scams**
This past year, the IRS issued a strong warning to consumers against an aggressive telephone scam. The scammers call taxpayers to inform them they owe outstanding taxes and demand payment over the phone. To lend to their credibility, the scammers will have the last four digits of the taxpayer’s social security number. If the taxpayer refuses to make a payment, the caller threatens the taxpayer with jail time, loss of driver’s license and, in some cases, deportation. When the taxpayer refuses to provide this information, the scammers call back pretending to be a local police officer.
If you receive one of these calls, the IRS requests that you take these steps:
• “If you know you owe taxes or you think you might owe taxes, call the IRS at 1.800.829.1040. The IRS employees at that line can help you with a payment issue, if there really is such an issue.
• If you know you do not owe taxes or have no reason to think that you owe any taxes (for example, you’ve never received a bill or the caller made some bogus threats as described above), then call and report the incident to the Treasury Inspector General for Tax Administration at 1.800.366.4484.
• If you’ve been targeted by this scam, you should also contact the Federal Trade Commission and use their “FTC Complaint Assistant” at FTC.gov. Please add “IRS Telephone Scam” to the comments of your complaint.”
The IRS wants you to know that they never initiate contact with taxpayers via email to request personal or financial information. They also never ask for PINs, passwords or similar confidential access information for credit cards, banks for other accounts. If you receive an email claiming to be from the IRS, you should forward it to phishing@irs.gov.

**Investor Scams**
The Financial Industry Regulatory Authority (“FINRA”) recently published a warning to registered representatives about three different scams where registered representatives may be subject to “Firm Identity Theft”.
The first scheme involves scammers fraudulently using the identity of legitimate registered representatives and brokerage firms to con investors out of their money by building websites that mirror legitimate websites of broker-dealers and registered representatives. The scammers claim they are registered with FINRA and SIPC. Victims who fall for this tactic are tricked into making payments or investments through the site. The scam artists collect the money and then disappear.
The second one puts a new twist on an old tactic by perusing international investors with and “advance fee scheme” or “mirror fraud.” Again, scammers use the identity of a legitimate broker-dealer and contact investors with an attractive offer. Examples of these offers include lifting a stock restriction or purchasing investors’ shares for an amount significantly above their market value. In return, the investor is asked to pay certain fees and expenses in advance. Once the investor has paid the fees, the fake broker-dealer steals the money and disappears.
The last scheme involves fraudulent checks. The scammer, using the stolen identity of a registered broker-dealer, contacts a customer is an attractive offer, like offering to overpay for an item on Craigslist. When the scammer sends the check, it’s for a much larger amount than the agreed-upon price. The scammer then requests the seller to mail the difference back to the scammer. In an effort to convince the customer of the stolen identity, the fraudster will use the broker-dealer’s true address as the return address on the mail sent to the customer. Believing they are dealing with a real broker-dealer, the customer is persuaded to send money. But, when the seller cashes the original check, it bounces.

Protecting yourself from these scams requires vigilance. If someone contacts you with and offer that’s too good to be true, it likely is!

Identiy Theft – financial planning tips on protecting your computer

On line usage is up, but so is identity theft.

One example we hear of often is an e-mail purporting to be from the IRS regarding a refund. The IRS has said categorically that they do not send out e-mails, so this is clearly a scam to get personal information.

So, as a financial planning matter, what do to protect your computer and your personal information?

Here are several good tips from WebRoot, a software company that provides related software, worth applying to your computers:

1. Keep Your Security Software Up to Date: At a minimum, your PC should have current antispyware, antivirus and firewall protection.
2. Watch Out for Email Scams: Never click on links sent in unsolicited emails, even if it appears to be from a legitimate source [the IRS example above is but one….].
3. Use Strong, Unique Passwords: Create passwords that are difficult to guess, and use different passwords for each of your accounts.
4. Shop and Bank on Secure Connections: Hackers can intercept data sent over unsecure wireless connections, so exercise caution when performing sensitive online transactions in public places.
5. Erase Cookies: Get in the habit of clearing cookies off your hard drive after you browse the web. Some privacy protection software can automatically do this for you

Be sure you have applied all of the tips to any computer not already protected. And, let me know if you have questions or concerns

Thanks,

Steven