Guard Dog ID is a publically traded company that was founded in February, 2008 and is headquartered in Winter Park, Florida. The President and CEO (company founder) is James Watson whose specialties are investing, financing and marketing. In 2009, he merged Guard Dog Inc. with FSBO Media Holdings Inc. and made the company’s public offer. At that point, the company began trading on the Pink Sheets (GRDO.PK). Caridad C. Templin is the company’s Vice President of Client Relations. Her specialty is finance/banking and she is bilingual (Spanish/English).

Features

The company offers three levels of protection which are designated Advanced, Premium and Superior. Each level provides the following standard features:

• Net Deflect – This scans illicit websites, bulletin boards and chat rooms that are involved with the trading and selling of a member’s personal and financial information. This is accomplished using a proprietary surveillance technology (Net Deflect).
• Court Records and Reports – Members receive a criminal actions list which is associated with their birth date, name and Social Security number. The reports are updated monthly and are taken from federal, state and county sources.
• SS Indicator – An alert is sent if a member’s information is found in a database that can’t be matched to other dashboard information reports. This is a proactive measure that can stop fraudulent activity prior to the occurrence of financial damage. It can also prevent criminals from using a member’s identity to conceal theirs.
• WalletGuard – If a member’s purse or wallet is lost or stolen, immediate action is initiated in order to cancel credit/debit cards. Personal information is also protected through increased monitoring.
• SSIndicator – Members are given a list of all the addresses that have been associated with their Social Security number and name.
• PervertAlert – National and local sex offender database are monitored in order to alert members of sex offenders who are moving into their zip code/neighborhood or using a member’s information while committing an offense.
• SureAddress – National databases are proactively monitored in order to alert members of any activity that matches their information. This includes a Change of Address Report.
• Identity Restoration Expert – Trained restoration experts are assigned to manage issues that are fraud-related. An expert will be directly assigned to a member’s case in order to completely restore their identity.

• $1 Million Insurance Policy  (on all plans except Essential Protection) – Coverage is provided for lost wages due to identity theft that occurs while using Guard Dog ID services ($500 per week for four weeks). In addition, professional services required to address identity theft are covered with no deductible or member out-of-pocket expenses.

All of the protection packages include these core features. The Premium plan will add an instant one-bureau credit report and score plus monitoring. Information will also be monitored on payday loan applications. The Superior plan offers the same protection but includes all three major credit bureaus instead of just one.

Pricing

Essential Protection – This plan provides the basic protection methods which include data breach notification, online threat alerts and daily security vulnerability alerts.

Cost is $2.95 per month or $24.95 annually (save $10)

Advanced Protection – This plan is backed by the $1 million ID theft insurance coverage and has a 30-day Money Back Guarantee.

Cost is $9.95 per month save 10% on annual enrollment.

Premium Protection – This plan increases the protection by monitoring non-credit (payday loans) and credit activity. Access is also provided to a one-bureau credit report. The plan is backed by a $1 million coverage policy.

Cost is $14.95 per month or save 10% on annual enrollment.

Superior Protection – Includes all the features of the Advanced Protection plan plus provide access to all three credit bureaus along with the $1 million coverage policy.

Cost is $18.33 per month or save 10% on annual enrollment.

As one of the most popular and leading identity theft service providers, ProtectMyID is dedicated to proactively protecting customers against identity theft. Their relationship is connected to Experian®, one of the three major credit reporting bureaus and the largest in the world. This allows them to have access to the detailed personal identity information of their customers. This is a powerful combination of the Experian Interactive family of Internet sites along with security standards that are world class.

Experian is currently the global leader of world-wide information service companies. They provide data and analytical tools for their clients in over 80 countries. They help businesses address potential fraud issues, manage credit risk, identify marketing offers and provide automated decisions. It is listed in the London Stock Exchange while being an FTSE 100 index constituent. It currently has 15,000 employees with their total revenue of $4.2 billion as of March 31, 2011. Corporate headquarters is based in Dublin, Ireland. Other operational headquarters are located in: California, São Paulo and Nottingham.

Features

ProtectMyID provides the following features as part of their standard service:

Surveillance Alert^™ Notification – ProtectMyID will alert their customers of any new activity that is connected with their personal information. This will be accomplished through email or text messaging. This will provide the chance that a customer may stop fraudulent activity from damaging their credit. This is done with three levels of advanced monitoring and resolution tools provided by the company.

Credit Monitoring – Potential criminal activity and fraudulent purchases may be seen every month on credit card statements that are provided by the company. However credit purchase monitoring is done each day. It is advertised that 50 leading identity theft indicators are monitored. These will include medical collections, new loans and other unique threats.

Internet Scans – Online sources that pose threats to debit, Social Security and credit card numbers are monitored on a daily basis. Observations are made regarding trading and selling this personal type of information.

National Change of Address Monitoring – Monthly statements and bills are used though a fraudulent change of address that is requested through the post office. This type of activity is monitored on a daily basis.

All Clear Surveillance Alerts – An All Clear Surveillance Alert is given if a customer’s identity is free from activity for a period of one month.

Identity Theft Resolution – Professional Identity Theft Resolution Agents will assist with any identity theft resolution hassles and complexities.

$1 Million Identity Theft Insurance – This is provided in order to cover lost wages, fraudulent electronic funds transfers, private investigator and legal defense funds associated with identity theft that occurs after a customer has signed up with ProtectMyID services.

Lost Wallet – Debit cards, credit cards and medical insurance cards will be cancelled with professional assistance in the event a customer’s wallet is lost or stolen.

Child Secure – Customer’s children are protected by monitoring any credit activity in the child’s name. A clean credit slate is also assured in the children’s name later in their life.

Medical Defense – Stolen customer’s medical insurance information is reported to the customer.

Pricing

ProtectMyID can be tried for 30 days free of charge. Afterwards, the cost is $9.95 per month. Customers will not be charged prior to the end of the 30-day trial. The ChildSecure feature costs $6.95 per month. A discounted price ($24.95) is also offered when requesting reports from all three major credit bureaus (Experian, TransUnion and Equifax).

Customer Service

ProtectMyID may be contacted for assistance by email or phone, Monday through Friday from 6:00 am to 6:00 pm (PST). On the weekends, they may be contacted 8:00 am to 5:00 pm (PST). They also feature a FAQ and Resource website section. 

LifeLock is an identity theft production company that began in 2005. According to their website, for $10 per month (minimum) they can identify non-credit and credit related fraudulent service applications. These services can include loans for mortgages and autos, utilities, check orders, job payday loans and wireless services. Unwanted spam mail for pre-approved credit card offers will also be eliminated.

However, 2009 saw the company accused and convicted of defrauding Experian and customers by means of keeping their credit information in a permanent state of “fraud alert”. Todd Davis, the former CEO was the victim of identity theft in 2007 and 2008 for a total of 13 occasions. The company co-founder, Robert J. Maynard, Jr., was accused of stealing his father’s identity while amassing $150,000 in American Express bills. He resigned in June of 2007. The company was fined $12 million in March 2010 by the FTC (Federal Trade Commission) for making false claims while promoting its services.

Features

LifeLock believes in taking a proactive approach to identity theft protection. As such, it offers the following features:

• LifeLock’s eRecon™ – This feature scans areas of the Internet that are known to be places where personal information is illegally sold for criminal purposes. If a customer’s personal information is detected, that customer will be immediately contacted in order to resolve the problem.
• TrueAddress™ – This feature scans a series of address databases throughout the country in order to detect any changes. If a fraudulent change is detected, LifeLock will work with their subscriber in order to restore accurate info. It’s known that identity theft criminals will generally alter their victim’s address when attempting to have fraudulent credit cards sent to them. This way, the cards will be sent directly to the criminals and not to the victim’s address. It can sometimes take months for the victim o realize what has happened and begin to sort the problem out.
• LifeLock Identity Alert™ – This will alert customers when it detects that their information is being used to apply for employment, credit or any service that requests personal information. Customer alerts are sent by email, phone and to the subscriber’s personal address.
• WalletLock™ – If the customer’s wallet is lost or stolen, it only takes one phone call to have all of the missing credit cards are suspended and replacements to be sent. This can be a very convenient feature for those who don’t have the time to contact each credit card company that is involved. WalletLock™ also covers debit cards, your Social Security card, driver’s license, insurance cards, personal check books, and even Traveler’s checks.
• Customers are removed from pre-approved credit card offer lists and other junk mail lists. These can also be a source of fraudulent credit activity.
• Your free annual credit reports from Experian, Equifax and TransUnion are automatically ordered. This way, customers can look over their credit reports for discrepancies and potential problems.
• $1,000,000 Total Service Guarantee – Subscribers receive a guarantee that covers expenses should the service fail to provide adequate identity theft protection (Restrictions may apply. See lifelock.com for further details). Lifelock has promised to do what is necessary to recover their customer’s good name by spending up to $1 million on accountants, lawyers, investigators, case managers or any other type of professional that is needed to accomplish this task. This is in contrast to other services that require their customers to do their own hiring while “assisting” them in the cleanup.

Pricing

LifeLock – Standard protection services with their $1,000,000 guarantee – $9.00 per month or $99 annually.

LifeLock Ultimate – Standard protection services with their $1,000,000 guarantee, 24/7 online access to your monthly TransUnion credit scores, daily monitoring of all three major credit bureau reports, savings and checking account application alerts – $22.50 per month or $247.50 annually. Free 30 day trial.

Customer Service

Customer service is 24/7 and can be reached by phone (800 and international number), FAX, email and regular mail.

ID Watchdog represents itself as a complete identity theft protection service that offers “360 degree” protection along with identity theft protection and resolution. The company started operations in 2005 and has its headquarters in Denver, CO. It is publicly traded in Canada on the Toronto Stock Exchange and its CEO and Chairman is Daryl Yurek.

ID Watchdog filed for a patent in 2007 for its system of matching new data points (appearing in monthly reports) against their Identity Profile reports. This is designed to monitor security breaches and presents its information in a consumer-friendly manner.

Product description

The service offers a three levelled approach to its protection through monitoring and detection of identity theft issues and then resolution, if necessary. Their detection system is handled through the use of database monitoring that encompasses thousands of publically traded information online databases. Their detection is then accomplished by their ID Snapshot™ service. This creates a complete report of the customer’s personal information and the matches it against any unauthorized use. Should an imposter be discovered, the ID Rehab™ service is utilized to clear the customer’s name. The company will speak on your behalf and file the necessary resolution paperwork.

The benefits include a unique service that goes beyond a credit review and checks out other forms of private information. The downside is that the service fails to offer a solid means of customer credit protection. This is in contrast to other companies that provide identity theft protection.

Product Features

• The use of a three product combination that can provide a comprehensive service of identity theft protection within different venues.
• An “Identity Profile Report” compilation which contains the customer’s personal data.
• The use of the Identity Profile Report in order to alert customers of unauthorized access to personal information.
• Proprietary technology that is used to scan thousands of reports while monitoring personal information.
• Ability to go deeper into suspicious activity through the use of ID Snapshot.
• Each user may have a 20 minute professional consultation regarding ID Snapshot findings.
• Negative effects of ID fraud are addressed with ID Rehab.
• Paperwork filed and negotiations with financial institutions are done through resolution experts.
• Customers are given a 100% resolution guarantee.
• Customer individual profile report can be accessed in real time through the Identity Management Dashboard.
• Dedicated technical support and FAQs.
• Customer Support helpline (toll free).

Pricing

Pricing is pretty straightforward. There is no complex menu of service since each price is all-inclusive. Membership costs are, as follows:

• Monthly Membership is $19.95
• Annual Membership is $179.95 (Save 25%)
• Protection Combo is $259.95 and provides ID Snapshot and one year of ID Watchdog (Save $20.00)
• Three Years is $466.95 (Save 35%)

Customer Service

Customer support is one area that ID Watchdog can improve upon. While a FAQ section is provided, the support service can only be reached by phone during the hours of 9 a.m. to 6 p.m. (MST) Monday – Friday. They are closed Saturday and Sunday.

Identity Guard is part of Intersections Inc. and functions as its identity theft solutions unit for consumers. Intersections is in the business of providing security and fraud protection for financial and banking institutions and they currently serve over 7 million clients globally. In addition, they also provide membership products and consumer-oriented insurance as well as screening for pre-employment background checks. These checks are performed through Screening International LLC (domestically) and in partnership with Control Risks Group Ltd. (internationally).

Features

In all, there are four levels of services designed to protect the customer’s identity. As one moves up the levels, the protection, as well as the cost, will increase. This is designed to address the individual needs and budgets of their customers.

“Good Start” Identity Protection Package

This is the first and least expensive package offered. It provides daily monitoring of the three credit bureaus as well as alerts through the customer’s email. The daily monitoring has been shown to detect fraudulent credit activity and is designed for the customer to review credit report accuracy. Changes in the customer’s credit report will be emailed to the customer, who can then verify if the change is authorized. This will help the customer limit any losses and/or impact to their credit rating. This service also provides a toll free number that customers can use to contact support. Support will help with any necessary steps that need to be taken in case of fraudulent activity.

“Watchful Eye” Identity Protection Package

The next level of protection will include the additional monitoring of known online “black market” sites in addition to all the services provided by the “Good Start” package. This service is useful for those who spend time on the Internet making transactions or who use other electronic devices for transacting business. With most electronic transactions, there is always the possibility of personal information theft. A customer who chooses this service may register up to 10 credit cards, which will be monitored continuously. The monitoring is to ensure that those credit card numbers are not being sold online for criminal purposes. If a customer loses a credit card, they can easily cancel them with this service.

“Extra Caution” Identity Protection Package

Provides the same protection service as the Watchful Eye package, but adds credit bureau scores, reports and quarterly updates from the 3 bureaus. By obtaining your reports, you will have the opportunity to check for any inaccuracies. Access to your credit scores may assist in improving financial affairs and the negotiation of new credit terms.

“Total Protection” Identity Protection Package

Provides the same protection service as the Extra Caution package, but adds access to reports on public records. Included are Social Security fraud monitoring and applications scanning. This is achieved through a proprietary combination of different technologies that scan and report the improper use of; owned property records, address information, driver’s license data, civil court judgements and other asset information. This will also include the monitoring of potential Social Security information misuse. This package also includes the useful ZoneAlarm® Internet Security Suite. Updates to this suite are provided for as long as the customer is enrolled in Total Protection. The suite provides protection against spyware and viruses as well as wireless PC protection.

Pricing

• “TOTAL PROTECTION”: $17.99 per month or $179.95 per year (saving 15%)
• “EXTRA CAUTION”: $14.99 per month or $149.95 per year (saving 15%)
• “WATCHFUL EYE”: $9.99 per month or $99.95 per year (saving 15%)
• “BASIC PROTECTION”: $4.99 per month or $49.95per year (saving 17%)

Customer Service

Identity Guard’s Dispute Center

If a credit report entry or credit score is deemed inaccurate by the customer, it is a good idea to dispute that entry before it harms one’s credit rating. A poor credit rating can have multiple negative impacts in many financial areas. Identity Guard’s Dispute Center provides the resources needed to assist their customers through the credit dispute process. At that point, helpful information is provided that will focus on the correction of those credit reporting inaccuracies.

Support is available 24/7 and can be reached through:

• Email address at: customersupport@identityguard.com
• Online FAQ at: www.identityguard.com/id-theft/faq.aspx
• Toll-free number: 1-800-452-2541

Identity Guard also offer a reimbursement policy to those customers who have lost money through identity theft while enrolled in one of their programs. The difference between the customer loss and the financial institution reimbursement will be paid – up to $1 million (with stipulations outlined on the website).

With their base located in Redwood City, California, Trusted ID began operation in 2005. They are currently funded by Draper Fisher Jurvetson and Opus Capital Ventures. They have been recognized by the non-profit organization Identity Theft Resource Center whose primary focus is the continuing research and prevention of any activity involving identity theft.

Because of this, TrustedID has been acknowledged as one of the premier companies combating identity theft. It has been featured in such publications as Newsweek, the New York Times and the Wall Street Journal. It has also been named as #1 in its class, as an identity theft resource, by Javelin Strategy and Research. Financial expert Suze Orman has also officially endorsed its services.

Features

Along with identity theft protection, there is also assistance provided should there be an occurrence of identity theft. The complete identity theft package offers a number of features that will serve to deliver comprehensive protection which consists of:

Credit Monitoring – performs a daily review of activity involving the major credit bureaus (Experian, Equifax and TransUnion). If there are any changes to the customer’s three reports, a notification is made. The customer will also receive their credit score along with a credit report from each bureau, as well.

Fraud Alert – A fraud alert may be authorized by the customer on their credit reports. This means that the customer will be notified before any new credit will be issued. The customer will also be reminded to renew the fraud alert every 90 days prior to expiration.

Identity Threat Score – a proprietary scoring system is used to indicate the perceived possibility of identity theft. This score is the product of continuous monitoring of the currently available private and public databases which number in the hundreds. This means that literally millions of financial records are researched. An analysis is then made of the patterns that may indicate the possibility of current or future identity theft. The score is then presented on a scale of zero – 500.

Eliminate Unsolicited Credit Checks – “pre-approved” credit offers will cease after the customer’s name is taken off of lists that are used by credit solicitors. This will also lead to a decrease in junk mail, in general, since the customer’s credit report can no longer be accessed by unsolicited third parties.

Identifying Potential Medical Benefits Fraud – One of the most common varieties of identity theft fraud involves the unauthorized use of medical benefits. Your current medical benefits statement will be scrutinized to determine if this type of fraud has taken place.

Website Surveillance – Periodic scans of known “black market” personal information websites are performed. These are sites where the personal information of identity theft victims are sold and purchased for criminal purposes. This information may include a victim’s name, address, credit card info, Social Security number, and banking information.

Warranty – As a member of TrustedID, you can receive coverage of up to $1 million if you are the victim of identity theft. This money can be used for expenses which include:

• Assistance for the restoration of your identity
• A maximum of $5,000 for up to four missed work weeks – days missed due to time needed for credit repair purposes
• New credit application fees
• Missed work time due to issues with employment qualifications as a result of identity theft
• Legal fees resulting from identity theft

Family Plan – A discount is given when two adults sign up at the same time.

Credit Freeze – For an additional fee, a credit freeze will be implemented with the three major credit bureaus. This saves time and effort over manually contacting the three bureaus independently.

Customer Service

The customer service department can be contacted 24/7. There is also the promise that customer service will be based in the US and will not be foreign outsourced. Service is provided by trained identity theft professionals with a “superior” service rating. Any additional products are only suggested when there is an immediate need.

Pricing

A 14-day free trial is offered. Afterwards, the cost is $125 yearly (individual) or $240 yearly (two adults on the family plan).

Extent of Credit Report Inaccuracies

There is conflicting data on the number of consumer credit reports that contain inaccuracies. The 2011 U.S. Consumer Credit Reports: Measuring Accuracy and Dispute Impacts study conducted by the Policy & Economic Research Council (PERC) finds that 3.87 percent of all credit reports examined had one or more errors that would impact a credit score.

However, the U.S. Public Interest Research Group disputes the findings of the PERC study, which was funded by the three credit reporting agencies. According to the U.S. Public Interest Research Group, other studies have shown error rates as high as 25 percent. The group says the PERC study underestimated the error rate by overestimating the number of satisfied consumers who used the dispute resolution processes of the credit reporting bureaus.

Since the federal Fair and Accurate Credit Transactions Act allows consumers free credit reports once a year, the best common practice would be to check your credit report for inaccuracies at least once a year.

Main Reasons for Credit Report Inaccuracies

The main causes of credit report inaccuracies, according to the PERC report, include:

• The account doesn’t belong to the person.
• Incorrect present/previous account status.
• Inaccurate payment history profile.
• Account closed but still shown as open.
• Identifying information is incorrect.

Credit repair, whether do-it-yourself or conducted by a credit repair company, removes inaccurate information from your credit report by disputing items through a dispute resolution process with the credit reporting agencies. It is important to note that credit repair can only be used to remove incorrect information. For example, if your credit report indicates you made a late payment and you have documentation that shows the payment was not late, then the credit repair process can fix the error.

However, credit repair is not a solution for removing accurate negative information. For example, if you have bad credit because you made late payments on a legitimate debt, then credit repair cannot remove this factual information.

Reasons for credit repair differ from person to person. If you have reason to believe that your credit report contains errors or inaccurate information, then proceeding with credit repair activities will ensure your credit score is not impacted by this negative incorrect information.

At the end of each year, the Internal Revenue Service endeavors to alert the general public regarding identity theft scams. These regularly pop up and target those who will soon be emailed their job-related tax forms in order to file for income tax (to obtain a refund or pay additional taxes). The psychology behind this has to do with financial recovery after the holidays and, face it who wouldn’t like to get a cash windfall from the government?

In times of economical hardship, the identity theft scams increase proportionally in number [1]. The starting point of these scams can normally be found in your personal (and ofttimes work email addresses). The scam starts by getting the victim’s attention with a promise of a large sum of money that is waiting for them. According to the email, all that is needed is to transfer the money from a foreign bank account to the victim’s personal checking or savings account. What could be easier – right? The large sum of cash is supposedly from a lottery winning, or an inheritance. Some of the most insidious scams are those that appear to come from the IRS, itself. This may be from some bogus new policy or unclaimed tax refund based on an obscure technicality that the victim wasn’t aware of when they filed their taxes.

Scams based on religious beliefs.

Due to the poor economy, you will also see a large number of scams that rely heavily on the criminal element masquerading as extremely religious individuals. These scammers will use the name of God and attempt to get on the good side of the victim by pretending to be followers of Christianity. They will pretend to be involved with charities and ask for help to get money to those who are less fortunate. But they can be spotted if you know the “language” of the scammer [2]. The ironic thing about these identity theft scams is that, although the scams are being reported as “new”, they are, in truth, just variations of scams that were popular way back in 1920.

Government-related scams

Scammers posing as government related officials from the FBI, the Department of Justice or the IRS are common since they seem to have a certain amount of power over the victim’s circumstances. These scams can be based in either fear for the targeted individual or a sense of relief. This can appear to the victim that a financial problem may be readily resolved. The victim can be contacted and personal information acquired through telephone call, a phishing email or text and voice messages. In a more frightening variation, they may even knock on your door! Fake websites and bogus identification badges are also employed to “identify” the criminals. The phony websites will look just like the genuine article – but nothing is perfect. Incorrect spelling and suspicious URLs (website addresses will, in most cases, give them away. When English is not your first language, small things can be very noticeable – such as inappropriate humor on an official U.S. government website. The lack of understanding of a country’s customs and way of thinking can often be a glaring error to a genuine resident’s observation.

How to protect yourself

Some ways to protect yourself from this type of identity theft are, as follows:

1. Never send your personal information in a response to an unsolicited email.
2. Don’t click on links to other websites when giving out information. Pull up a genuine website located on a paid hardcopy bill.
3. Don’t respond to a promise of an IRS refund for answering a “survey”.
4. Watch out for long email addresses. This is especially true of addresses that don’t start with the organization’s name.

Visit websites that discuss how to protect yourself from identity theft scams and fraud. The more you know, the better able you will be to protect yourself!

See also

Credit Repair Companies
by NJMSC

As you surf the Web, you are not alone. As a result, many countries have declared March to be the month to bring awareness to consumers about the dangers of fraud, including Internet fraud. Cybercriminals are estimated to cost consumers in the United States 1.2 billion dollars annually, and the amount of time victims need to correct the problem each year is steadily increasing.

E-commerce is a worldwide-phenomenal growth industry, but some experts believe that it hasn’t yet realized its full potential because of consumer wariness over cyberfraud. The segment of the population that steers clear of e-commerce is a loss of revenue to Internet businesses.

Cyberfraud Is a Lucrative Business

Many criminals are pulling out of the drug trade and concentrating on making money through fraud, including Internet fraud. It is believed that these acts from fraudulent medical claims to Internet scams are beginning to rival the drug trade business in many countries.

Those who regularly shop the Internet can be complacent about cyber criminals. According to a study by the Organization for Economic Co-operation and Development (OECD), many consumers believe that they would never fall victim to an Internet scam, but a study of cyberfraud concluded “being fooled by a scam is not a reflection of the education, age, or background of a victim.” An informed consumer is the best defense against cybercrime.

Email Scams

The first cyber scams originated through emails when most Internet users were only concerned with an overload of spam. An early email one was dubbed the “Nigerian” scam, and was a request for money by a so-called government official or a royal family member from an African country. It was a plea for assistance in transferring money out of a country. The victim needed to send small advance payments to cover banking transaction fees, but never received the promised money.

Since then email scams have become more sophisticated, but any request for advance fees and promises of large payoffs is a neon sign for cybercriminals at work. The best defense is to set your email filters at a high privacy level and not open any unsolicited emails.

Common Online Scams

Various other scams are operated on the Internet. Consumers aren’t as gullible as in the early days of the Internet, so the cyberthieves have had to respond with every more sophisticated schemes. But spam is still a tool for ID thieves. Some common ones are travel and credit-related schemes, fake lottery ploys, web and modem hijacking, and identity theft. Many scams are frauds that have always existed in the real world, but are now transferred to the online community.

Cybercriminals can operate on the Internet under the guise of legitimate traders with professional-looking websites which offer miracle products, work-at-home jobs, rock-bottom prices on items, or “once-in-a-lifetime” investment opportunities. They are also becoming adept at scams through text messages on cell phones.

Internet users are usually aware of “phishing” scams, which trick victims into disclosing personal information online. But to raise the level of sophistication and entice more victims, phishing scams now often include more personal information in the email, leading the victim to believe in the authenticity of the message.

Another deception is using a VoIP phone as the contact phone from websites or text messages, which can record account numbers entered into it.

Prosecuting Cybercriminals

A problem with cyberfraud is that it is difficult for consumers to take legal action when they have been victimized. Consumers don’t have the investigative means to find and identify the cybercriminal, and establish proof of criminal activity.

Another drawback is that the consumer usually doesn’t have the financial wherewithal to take criminals to court. And to complicate the picture, many cybercriminals are in foreign countries as the Internet doesn’t recognize boundary lines.

The Federal Trade Commission collects information on identity theft and helps consumers who have been victimized. Their website is helpful to anyone who would like more information on identity theft or needs to report a crime: http://www.ftc.gov/bcp/edu/microsites/idtheft/.

Why identity protection?

Reference:
1. OECD, Protecting Consumers from Cyberfraud, October 2006, http://www.oecd.org/dataoecd/4/9/37577658.pdf

At some point in your financial life, you will need to borrow money for major purchases that you want, whether a new car or a new home. Before you knock on a lender’s door, you should find out what your credit score is. That credit score will either enable you to borrow at a desirable rate or it will add more cost to your loan. If you are planning on making a major purchase in the coming months, it is crucial to evaluate your credit score beforehand. This will leave time for you to work on improving your credit score to receive more favorable loan terms, and ahead of many loan applicants who don’t grasp the importance of the credit score.

Added Costs of a Poor Score

Around 70 percent of consumers don’t realize how costly it is to have a low credit score. According to a study by the Consumer Federation of America, a nonprofit consumer agency, and VantageScore Solutions, if your credit score is below 600, you could be paying an extra $5,000 more on a $20,000, 60-month car loan. On a 30-year mortgage, a low credit score can add as much as three full percentage points to the interest rate. This is a difference that can cost a family as much as $2,400 yearly or $72,000 over the life of a $100,000 mortgage.

With the economic turmoil of the last few years, many consumers have been adversely affected. Credit scores sank to new lows during the deep recession of 2008-2009. The Fair Isaac Corporation of the FICO score system revealed that over 25 percent of consumers (43.4 million people) had scores below 600, putting them in the category of poor risks where loans are denied or costly.

Comparison Shopping Doesn’t Lower a Score

One of the biggest misconceptions about credit scores is that a consumer lowers his or her credit score by comparison shopping. Quite to the contrary, every prospective borrower needs to get out and talk to several lenders to compare their loans. It will not affect their credit score, and it should help them find the lender with the best terms for their loans.

When talking to lenders, find out what type of scoring system they use. If your score is a FICO number, the range will be from 300 to 800, with a median score of 622. Since other methods of computing credit scores exist beside the well-known FICO score. You may think that you have a high score at 750, but if the range is from 150 to 934 (the scoring range at the TransUnion credit bureau) that number no longer looks so good.

Credit Card Balances

Another assumption was that balances on your credit card should be kept at less than 50 percent of the available line of credit. In fact, you should use no more than 10 percent of your credit line in order to earn the highest credit score. For example, if your line of credit on a card is $10,000, you need to keep your balance at $1,000 or less.

Your credit score is not hurt by paying off a credit card, but it can be detrimentally affected by expensive purchases. Be careful of what you charge before applying for a car loan or a mortgage, as a large increase to the amount owed on your card will be looked at unfavorably by lenders.

Paying Cash vs. Charging

A good credit score can be built with charge cards, since a record of financial history is needed to create a credit score. If a consumer pays cash for all his or her purchases, there will be no record of the transactions at a credit bureau. It is better to keep a few charge card accounts open to record timely payments, which establishes a credit score and a financial record. Potential lenders want to see timely payments on other accounts to know that you have been creditworthy and will likely pay them back.

Reference:

1. Consumer Federation of America, Credit Scores Are Vital to Your Health,

http://www.consumerfed.org/elements/www.consumerfed.org/file/finance/yourcreditscore.pdf