Credit card fraud and identity theft have been in the news a lot over the last 6 weeks. It all started with the news that Target’s card processing systems were hacked resulting in the unlawful theft of 40 million customers’ account numbers and PINs. This data was sold on various black markets resulting in fraudulent purchases being made with fake credit and debit cards.
To make matters worse for Target customers, it was later reported that the data of 70 million customers was also obtained. This data included names, email and home addresses, along with other personal data. Instead of just worrying about false charges and the hassle of getting those cleaned up with banks and credit card companies, these customers have to deal with the very real threat of identity theft.
Target wasn’t the only retailer affected. Neiman Marcus announced they’d also experienced a data breach from malicious software that collected customer payment card data from July 16 to October 30. The data breach went undiscovered until December 13th. The number of people affected by this data breach currently stands at 1.1 million. The malware was not disabled until January 10th. The good news for Neiman’s customers is that it does not appear their PINs and social security numbers were captured in this data theft.
Last week Easton-Bell, a sports equipment maker headquartered in Van Nuys, California, announced they’d also been impacted by a data breach. They discovered their vendor servers which held personal data on 6,000 of their e-commerce customers who made purchases in December was compromised by a similar malware attack. Easton-Bell is investigating what data was obtained but hasn’t ruled out credit and debit card numbers along with card security codes.
Earlier this week, Michael’s Stores announced they are investigating a potential data breach similar to Neiman Marcus and Target. Michaels operates 1,137 arts and craft stores in the United States and Canada.
Security experts expect the numbers of retailers and e-commerce companies to grow as they piece together details in the Target and Neiman Marcus cases. They appear to be related and part of a very sophisticated broader scheme to unlawfully collect customer data.
Smart credit and debit cards that utilize the Europay, MasterCard, and Visa (EMV) technology will eventually arrive in the United States. The EMV cards contain a computer chip that protects an individual’s personal data and will replace our current cards with magnetic stripes. Holding up the move to EMV cards is a wrestling match between U.S. banks and retailers as to who’ll pay for the conversion which is estimated at $8 billion.
This means that protecting ourselves against credit and debit card fraud, along with identity theft is truly up to each of us. Here are 6 ways to protect yourself from the loss of this data and the many hours you’ll spend cleaning things up if it is stolen.
Use Cash: It may be a bit of a hassle to go to the bank or an ATM and get cash to make purchases for gas, food, and clothing, but you certainly won’t have to worry about a retailer’s data breach. You’ll probably spend less because it becomes harder to let go of cash than swiping a card.
Credit Report: How long has it been since you obtained your free credit report? That’s too long! Go to www.annualcreditreport.com and order yours now. Once you have it, confirm your accounts and loans are on there and look for accounts you didn’t open. If there are accounts you or partner didn’t open, get in touch with the credit bureaus immediately. While you’re at it, clean up all inaccuracies and work on improving your score. You’ll pay less for your insurance if you do!
Passwords: Change your passwords on all the retailer and e-commerce sites you visit, as well as with your bank’s web site. Adopt a practice of changing your passwords every quarter and adopt good password practices. This will not only protect your account data but also protect your personal data that make you vulnerable to identity theft.
New Cards: If you shop at Target, Neiman Marcus, Michaels, or any retailer that announces they’ve experienced or investigating a data breach, call your bank or credit union and order new cards. They may think you’re over reacting but why wait until you have to contest a false charge?!
Credit Monitoring: Target took an excellent first step by offering customers affected by the data breach a free year of credit monitoring. Take them up on it! This will protect you from becoming a victim of identity theft. Even if you’re not eligible for the free service, take a look into having your credit monitored. There are a number of services including IdentityGuard.com, LifeLock, CreditReport123, TrustedID, CreditKarma.com, and more. This service is also available through the credit bureaus. The monthly cost for these services range from $6.95 to $15.95.
Insurance: Home owners and renter’s insurance policies do have optional credit card and identity theft coverage available. This coverage pays for time lost from work, as well as expenses and fees incurred for items being notarized, mailing, and applications for credit that need to be redone. This coverage is helpful but only comes into play once unauthorized use has occurred but it will reimburse you for the time it takes to get things cleared up.
What are you doing to protect yourself from credit card fraud and identity theft? Share them, along with any questions or comments you may have, with me in the comments section of our blog on our Facebook and Google + pages. I’d love to hear from you!