How many times have you heard of a friend that is in the hospital or has past away due to a heart attack or stroke? The discussion quickly turns to reasons why. “Well, they were really overweight” or “They’ve been on medication for quite some time”, or, in my estimation the worst comment, “They just wouldn’t do what the doctors were telling them”. That last comment seems to be an indictment that this medical condition was completely preventable. The reality is it isn’t. We all know people that take great care of their body and still end up with a life threatening illness. Truth is, we all have a terminal situation called “life”.
Certainly the medical profession would love to prevent terminal illness, but until that happens the goal is to “mitigate” the damages and maintain a quality of life. However, we’re inundated with information on how we should live and eat as if it were for the end of preventing death. We know that’s not a reality so we either ignore the information or stick our head in the sand and think “it’s never going to happen to me”. Most of the medical information we hear is much like, “Blah blah blah, Cholesterol, blah, blah, blah, High Blood Pressure, blah, blah, blah, Exercise, blah, blah, blah, Heart Disease, blah, blah, blah, blah, blah.
The good news about medical issues is, if they are terminal, you don’t have to stick around and deal with the consequences. That’s usually left to your family or estate. However, this article is not about Medical Issues, it’s about Identity Theft. The analogy, however, holds true. Unfortunately, if you have an Identity Theft attack you still have to stick around and put things back together.
The Federal Trade Commission, (FTC), estimates it takes 120-600 hours and approximately $1500 in out-of-pocket expenses to restore your identity, if you ever get it completely back.
Five years ago Identity Theft was a fledgling industry that many people thought was a fad and that authorities would get it under control. Sadly, it has grown into the largest and fastest growing crime in the history of the world! Seems a new company is springing up everyday to “Guard, Lock, or Protect” your identity. Some are legitimate and some are opportunistic.
We’ve heard so much about Identity Theft in the last few years that it has become a Blah, Blah, Blah issue. People have developed some really dangerous ideas that, if left unchecked, could be fatal to their financial and social health.
The first is, “I just don’t think it’s going to happen to me, I don’t really believe it’s as bad as everyone says”. Fact is, it’s worse. There are 27,000 reported victims everyday. Many people don’t report for various reasons, but mainly because they don’t know. The average victim doesn’t find out they been a victim for over 12 months. Which is unfortunate since liability limits change after 48 hours and then again after 60 days of the event. Some reports are now saying that the average person can expect to be a victim 3-5 times in their lifetime.
The second response is, “My credit is so bad, I wish someone would steal my identity”. Depending on the report you read, credit issues are only 25%-30% of the reported events. The four other areas of affect are criminal activity, DMV records, medical information records, and IRS/Social Security records, i.e. reporting income on a false number.
The credit issues are relatively easy to fix, but losing your medical benefits due to testing HIV positive, or getting arrested for outstanding warrants on a routine traffic stop can be devastating. Especially if it’s not you and you have no idea where the information came from. You’re going to want to have access to an attorney, and not just in the 9-5 hours.
The third most popular response is, “We’ve got that covered through our financial institution, i.e. bank, credit card, credit union, etc.”. Financial institutions have found a great resource to charge consumers for doing what they used to do for free. You’ve got a number of resources available for financial theft issues that can be viewed at the FTC website. Most of these won’t cost you anything. However, a $50-$500 liability can severely impact most households. Early detection is the key to limiting these liabilities and getting your credit report 1-4 times a year is a little like using your smoke alarm on the weekends. Chances are, if you experience one of the four other areas of Identity Theft your financial institution isn’t going to help you, especially after hours.
The fourth, and probably most dangerous response is, “Oh, we’ve already had that happen. It took a long time, but we finally got it all cleaned up.” We’re not talking about the Measles or Mumps. Once you’ve been an Identity Theft victim, statistically, you are 50% more likely to be a victim again than someone that has never been a victim.
Nobody is going to be able to prevent Identity Theft. Your information is in too many places and there have been far too many breaches to think that you can prevent it. What needs to be done, as with our medical issues, is to take precautions against a premature catastrophe, then have a plan in place that will mitigate the consequences.
Visit the FTC Identity Theft website and see how to safeguard your identity. Then, contact any place that has your “non-public information” (NPI) and ask them if they have a written policy and plan in place to protect your information, then get a plan that will not just guard or lock your credit, but that will actually provide you with a full restoration plan and not just a do-it-yourself kit for all five areas of this insidious crime.
If you’re a business owner and someone steals your identity, it could affect your entire business. We have not yet seen the potential affects that this can have on businesses, but the “industry” is still young. Now is the time to speak with your attorney, consultants, and finance professionals and get your plan in place.
What about subscribing to Lifelock? Don’t they offer a 1 million dollar insurance policy that your identity will never be stolen.
Great question Laurel. Lifelock offers a gaurantee against ID Theft using their service. Which is only in regards to credit. They “lock” your credit report, which incidentally you can also do for free. They do this with each credit bureau once per quarter. Again, something you could do on your own. It also prohibits you from from using your credit. It does not however account for the 4 other areas of ID Theft that I have outlined in the blog.
I like the idea of Lifelock, but how secure are we really?
A miilion dolar guaranty huh? I would love to read the fine print to see if they have any escape clauses…
I never realized that credit was such a amall part of the identity theft problem and so easily fixed…good to know Lifelock has some weaknesses (4 other areas in article) Very informative
Frank & Jim, Thanks for the feedback. Lifelock does an adequate job at what they do, but it is really a service of convenience. Any person can do what they do with the bureaus for free. It appears the gaurantee is against mistakes on their part. ID Theft protection does not stop issues any more than car insurance stops crashes, it just mitigates the damages. We still haven’t seen the huge wave of impact this crime can have.
It’s really good to know that Lifelock is really adequate at handling issues such as this. Identity theft is really absurd. Must be cut down.
A bit of a correction, Ed. I did not sey they are adequate at handling issues such as this, I said they are adequate at what they do, which is lock your credit report. People pay them $10/mo. per person to do quarterly what you could yourself for free. Each quarter they lock your report with 1 of the 3 bureaus so that nobody can use it, including you. If you want to unlock it there’s a separate fee for that. The do not monitor, and they do not do restoration. Also they do not work in the 4 non-credit areas of I.D. Theft. I don’t like to knock a competitor, but I do believe understanding the services and their differences is important.
It’s a frightening thought, the thought that one could have their identity stolen, and the thought that often, in order to protect ourselves, we’ll have to sacrifice so much of our privacy it hardly seems worth it.. Is the cure really better than the curse?
Having a mitigation plan in place is no longer an option. Your privacy is compromised the moment you decide to do business in society. Medical records, financial records, education, licensing. Your information is already available. You can do the work to restore your identity, or you subscribe to a service that will do it for you, much like any other type of insurance. You can pre-pay, or you can post-pay.