Are you at risk of identity theft?
Have you ever decided not to purchase something on the internet because you were unsure about the site or had the feeling something might be wrong? Read on to find a source for that feeling.
The threat of identity theft is remote but real. With hackers, hijackers and spoofers out there waiting to steal your ID, password and financial information, a little caution is needed. This includes online and off.
When you’re paying bills, making investments, viewing your bank balance, checking your credit card statements, preparing your taxes and buying stuff online, are you taking a risk with your confidential financial information?
The answer, unfortunately, is that no one really knows. This is when and where that uncertain feeling begins.
The reality is that your financial information is vulnerable to identity theft even if you don’t own a computer. Some of the biggest hacking and identity theft cases have targeted business or government databases over which individuals have little control.
Certain online transactions may increase the chances that you’ll be a victim. Several recent incidents have shown that letting a Web site store your credit card number could put you at risk. This is because hackers have stolen credit card numbers from online databases.
Theoretically, just establishing a user ID and a password for a financial account could make you more vulnerable, because a hacker could conceivably break into your computer, plant a keystroke-tracking program, retrieve the data and use it to access your account. The brighter side on this is that most hackers wouldn’t bother with all that work for one account.
The reality is that it’s pretty tough to quantify your risk of losing valuable personal information to a computer hacker, and even less possible to determine how vulnerable you are to a financial loss because of that crime.
Giving your credit card to a waiter could put you at risk. The waiter could run multiple transactions, or obtain enough information from the card’s magnetic strip. This is done by the use of a pocket-sized device called a skimmer. The skimmer creates a duplicate card. Somehow we don’t worry about that risk.
What about “spoofing�? This is a hacking technique that redirects customers of a financial or shopping Web site to a look-alike, so thieves can glean IDs and passwords or credit card numbers. If done well, there is little to tip off an unsuspecting user. The real Web sites usually detect and swiftly shut down these incursions but in the short amount of time that it is found, you could be at risk.
You should not ignore the risks. There’s nothing like a long history of good experiences to make you comfortable transacting business on the Web. But understanding where the biggest risks lie might help you decide how much of your financial life you want to conduct online.
Computer security experts say the databases at either end of the Internet transaction (the one at the financial institution and the one in your computer) are usually the most vulnerable. The information that goes between these databases is typically encrypted and difficult to hack.
One expert likens an Internet financial transaction to driving an armored car between two cardboard boxes—the car could be targeted, but it’s far more likely hackers will go after the more vulnerable boxes.
Of course, you can’t always tell when a Web site is hanging on to the information you give it. Many reputable sites offer to “remember� your card number for you, but others may simply snatch and keep the information without consulting you. That’s why it’s important to deal with reputable sites and to review privacy policies.
A California law which took effect in 2003 requires companies to alert their California customers if hackers or employees steal information that could be used for identity theft. This should give us a better idea of the risks we are actually taking.
Because companies are required to comply regardless of where they’re headquartered, computer security experts believe the California law will lead to a nationwide increase in firms reporting hacking incidents. They also hope it will inspire companies to take additional security measures to avoid the hassle and publicity of such disclosures.
Consumers should be taking precautions. Firewalls, anti-virus software and the simple act of changing passwords once in a while can help reduce your vulnerability.
