Online Credit Card Fraud Prevention

Should you insure against ID theft?

The advertisements are intentionally frightening: If someone steals your identity, you could lose your home, your job, even your life.

The ads are meant to scare you into buying identity-theft protection. And while the problem is real, insurance isn't always the answer.

In fact, most consumers could better protect their identities if they guard their Social Security numbers, read their bank and credit-card statements and request their free credit reports.

"If it hits, it could be quite destructive to your life for a long time," said Linda Foley, co-director of the Identity Theft Resource Center in San Diego. "Identity theft is not a picnic, but it is repairable."

Even though Foley's former employer used Foley's personal information to apply for credit cards and purchase a cellphone, Foley considers identity-theft insurance "a personal choice item."

Her advice: Buy it only if you have the money and you want the peace of mind.

In 2004, about half of the victims surveyed by the Identity Theft Resource Center spent under 100 hours repairing the damage. Sixty-six percent said the information was used to apply for new credit cards, and 28 percent said it was used to buy a new cellphone.

Identity-theft protection varies in cost and coverage, but it either reimburses you for expenses from the theft or monitors your credit or accounts for changes.

Some insurance companies provide it free or for about $25 a year with your home insurance policy. But, in recent years, financial institutions have rolled out an array of services for about $12 a month.

American Express, for example, is pitching free as well as paid services. Its no-cost Identity Theft Assistance is available to all cardholders.

The program provides round-the-clock counselors, who help customers navigate the identity-theft maze. The company also has the typical fee-based services that monitor a customer's accounts.

Daniel Solove, a privacy expert at George Washington University Law School, finds it inappropriate that people have to pay credit bureaus for services they're legally bound to provide.

"Why should you pay for them to do their job better?" he said.

Instead, do it yourself. Consumers nationwide are entitled to get a free annual credit report. Stagger your requests among the three big firms, and you'll see what's happening every four months.

In Washington, state law allows victims of identity theft to freeze their credit reports. Those eligible are victims who have submitted a police report to the credit bureaus, and consumers who have been notified their personal data have been stolen.

However, a bill to extend the same protection to any consumer failed in the legislature earlier this month.  Source Seattle Times

New Study Debunks Identity Theft Myths

(CBS) LOS ANGELES The study, just released, is one of the largest of its kind, utilizing 5,000 telephone interviews with consumers. It exposes myths, which show the changing tactics of identity thieves.

Myth No. 1: The number of identity theft victims increases every year. Katie Mitzner is with the Southland's Better Business Bureau.

“It’s going down, that is in great part due to consumer awareness,” Mitzner says.

Myth No. 2: seniors are the most likely target of identity thieves. “Generation X -- ages 25 to 34 -- are the number one targets of identity theft, ” she says. [Read more - cbs2]

Identity theft feeds $1bn gaming black market

A plague of identity theft is afflicting South Korea's online gamers, as reported cases soar to almost a quarter of a million.

Many of the stolen identities are being used in gaming 'farms' in China as part of a $1bn a year black market in cash and items from online games, according to local media reports.

Online games are hugely popular in highly-wired South Korea. The country has well-funded professional video gaming leagues, and TV channels devoted to games. [Read more - vnunet]

8 zombie money scams that refuse to die

There are no new scams -- just new suckers. Scam artists add new spins to age-old scams and go in search of victims. Yesterday's snake-oil salesmen are today's e-mail hucksters for nutritional supplements.

Only today, these shysters don't personally swoop down on small towns with loud, rapid-fire, slick pitches. They slither through dial-up and cable connections and crouch in your e-mail inbox, on Web sites, or attack by telephone, disguising their identities behind nameless, faceless modern technology.

Don't get sucked in. By learning the eight basic scam types, you will be able to spot any scam -- no matter what new spin it's given by clever con artists. [Read more - msn Money]

Flood victim now fighting identity theft

ALSTEAD, N.H. The floods of October stole just about everything John Cochrane owned in Alstead (New Hampshire). Now someone has stolen his identity.

Cochrane says someone used his name to get credit cards from department stores and jewelry stores and has been running up bills out of state.

Cochrane's home was washed away in the flood. He figures someone downstream found his identification information in flood debris.