How to protect yourself against identity theft.
Identity theft is when somebody uses your personal information for their own financial gain. This can take on many forms, such as someone stealing your credit card details, hacking into your bank account or even applying for loans in your name. Criminals have also been known to conduct businesses in another person's name.
Your credit report and identity theft go hand-in-hand. If you are a victim of identity theft it could have a major impact on your credit rating, but by checking your credit file (which you can do for free with finder) you can stay alert to irregularities and errors and quickly report instances of identity theft.
In the guide below you can find out more about identity theft, some ways your identity might be stolen, how it affects your credit and how you can protect yourself.
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How many Australians are affected by identity theft?
Research from finder revealed that a record number of Australians were affected by scams in 2017. People made 161,572 complaints to the Australian Competition and Consumer Commission (ACCC) in 2017, with scams costing us more than $89 million. Phishing scams were the most common, with 26,000 Australians targeted in 2017. Investment scams accounted for 35% of all money stolen and 4,711 Australians reported scams involving social media.
How can your identity be stolen?
- Rubbish sifting. Many people make the mistake of throwing away bills and bank statements without destroying them. Scammers can go through your rubbish and find all the information they need to steal your identity.
- Theft. Criminals can get access to plenty of your personal details by stealing your wallet, handbag, mobile phone and letters from your mailbox.
- Phishing scams. Scammers create elaborate ruses to trick you into handing over your personal or banking information. A common example is sending an email or SMS that looks like it came from your bank or telecommunications provider to fool you into giving them your bank account numbers, credit card details and passwords. Another similar scheme involves scammers posing as someone from your bank and informing you that your card has been cancelled because of suspicious activity. Then they will ask you to give them your important account details so they can confirm your identity.
- Social networking. Have you ever stopped to think about how much information you give away online? Simply by signing up to Facebook or other social networking sites, scammers can track down personal information like birth dates, where you work and your family details.
- Other online scams. Thieves set up bogus retail websites and record your details when you make a purchase, or even post fake job ads online. They can then use the information people unwittingly provide in the job application. Spyware or malicious software can also install itself on your computer and steal your details.
How can identity theft affect your credit report?
If someone has access to your financial or personal details they can seriously damage your credit file.
They can apply for new loans, credit cards and mobile phone contracts in your name with no intention of ever paying back any money they owe. They can also max out your existing credit cards and spend money already in your bank account.
The majority of this information will be recorded in your credit file and affect your ability to access credit in the future.
Information that's recorded in your file includes:
- Credit applications you've made for the last five years
- Information about current and past credit accounts you've held
- Utility accounts for more than $150 that have been overdue for more than 60 days
- Clearout listings, where a lender has unsuccessfully tried to contact you regarding a debt and believes you have decided not to pay it
How to protect yourself from identity theft
There are several simple steps you can take to avoid becoming a victim of identity theft:
- Secure your personal documents at home. If you’re throwing any documents away, make sure to shred them first.
- Secure your mailbox with a lock and remember to redirect your mail if you move.
- Inspect your credit card bills and bank statements for any suspicious activity. If you receive new credit cards you didn’t ask for or bills for goods and services that aren’t yours, investigate why.
- Be cautious when using social media and limit the amount of personal information you publish online.
- Select passwords for your online accounts carefully. Also, use security software on your computer and mobile phone.
- Never use unsecured internet access points such as public Wi-Fi connections or public computers to access your bank account.
- Treat any request for your personal information over the Internet, phone and in person with caution.
- Don’t conduct any transactions on unsecured websites. Make sure a website is legitimate before handing over any details.
- Visit www.SCAMwatch.gov.au to learn how to avoid common scams.
- Check your credit file regularly.
What should you do if you are the victim of identity theft?
Anyone can be a victim of fraud, so it is important to know what to look for and how to respond once you find out your identity has been compromised. Here is what you should do:
- Contact your financial institution. Call your bank immediately and inform them that someone has access to your account or credit card. The bank will usually cancel all affected credit cards and close any suspicious accounts opened in your name.
- Place an initial fraud alert. This is a free service offered by the three credit reporting companies: Equifax, Dun & Bradstreet and Tasmanian Collection Service. This alert will stay on your report for 90 days.
- File a police report. This will allow investigations on the fraud to begin and give you access to a police report that you will give to financial institutions to avoid a bad credit rating. The police will also ensure that relevant government agencies are involved in the case if your documents were stolen i.e. passport, Medicare card, birth certificate etc.
- Get a copy of your credit report. This will allow you to contact credit report agencies and inform them of the identity theft so that they can help repair your credit standings by adding notes to your credit file.
There are further steps you can take if you feel that the above did not help rectify your situation, or you find that the steps you took were not recognised by certain businesses or agencies.
- If you feel that your privacy has been breached, you can contact the Office of the Australian Information Commissioner and lodge a complaint. Before contacting the commissioner, you should try to resolve matters with the agency or organisation concerned.
- If you are a victim of a Commonwealth identity crime and the theft is causing problems in your personal life or with your business, you may choose to get a Victim’s Certificate. This certificate is provided by a State or Territory magistrate, and you can present it to agencies or businesses to help support your claim that you have been a victim of a Commonwealth identity crime.
Finder's free credit report service gives you a free copy of your credit report and credit score and will also notify you whenever something on your credit report changes. You can check your credit report at any time to make sure the information is correct.
So while identity theft is a crime on the rise and there are more ways you can be caught out than ever before, a cautious approach to managing your details can ensure you won’t become a victim.