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Monday, December 15, 2008

Tips to Avoid Identity Theft while Holiday Shopping

Use credit cards instead of debit cards: Under the Fair Credit Billing Act, Credit Cards provide consumers protection again fraudulent charges and your liability is limited to $50. You also have the right to dispute charges and withhold payment during investigation. However, debit cards are entirely different. Although they market themselves to deliver the same protection, they are not required to by any law. Bottom line, your liability for fraudulent charges is the entire amount in your checking account as well as the credit line you have been authorized to receive.

Use a single credit card to consolidate your purchasing: The more credit cards open in your name, the greater the risk that a thief will obtain the account information for one (never mind that having numerous cards with big lines of credit can be a bad temptation and can actually drag down your credit score--even if you don't have balances). It's also easier to monitor a single statement for signs of fraud, and you won't incur the annual fees associated with having multiple cards. Make sure to cross-check all your receipts against your statements to see that they match.

Be sure to write "SEE ID" on the back of credit cards: This simple step can help to foil thieves if the card is lost or stolen, and might even help to catch the thief if your card is taken.

Shop on secure sites and be wary!: While the majority of identity fraud occurs offline, identity theft is also a problem online. You must exercise caution when shopping on the web. Stick to sites that you know are legitimate, and if you are trying a new site for the first time, here are a few things to look for: the URL should have "https" in the shopping cart; there should be a lock icon on the bottom right hand side of the window and look for icons that indicate site safety (the Better Business Bureau, VeriSign and Hacker Safe icons).

Watch out for "phishing" and "vishing" scams: These scams can be a real problem, as identity thieves try to play on people's generosity during the holiday season. Phishing emails often take the forms of requests purporting to be from a bank or credit card company; they ask you to "verify" account information such as login and password or they request a donation or assistance for the less fortunate during the holidays. Vishing scams--which involve fraudulent calls—seek to exploit consumer concerns over fraud by seeming to offer fraud prevention assistance. The bottom line: no legitimate vendor will ask for your login and password via email or on the phone.

Be careful when using ATMs: Only use ATMs with monitoring cameras, such as those in bank lobbies. Avoid kiosk ATMs, those freestanding units often do not have cameras and are statistically more likely to be infected by skimmers (electronic devices that allow thieves to record account and PIN numbers). "Shoulder Surfing" can also be a problem at a crowded mall. While you assume that the man behind you is uncomfortably close because of mall crowding, he may actually be looking over your shoulder trying to get your login.

Place fraud alerts to prevent new credit card accounts from being opened: Free fraud alerts placed on your credit report are good for 90 days (if you can demonstrate that you've been an identity theft victim, they can be set for 7 years) and, in combination with other proactive measures, can be used to help to prevent identity theft.

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