— One of the best parts of my job is helping address readers' financial concerns. The data breach at Target had a lot of people really worried.
During my last online discussion of the year, a number of people were concerned that information on about 40 million credit and debit card accounts was accessed between Nov. 27 and Dec. 15. This included customer names, credit or debit card numbers, expiration dates and security codes. The data breach only affected in-store purchases, according to Target. Here are some of the readers' questions:
Q: How can the information about one credit card lead to identity theft?
Singletary: The Federal Trade Commission says identity theft is the No. 1 complaint it gets from consumers every year.
There are many forms of identity theft. If identity thieves have your personal information, they can access your bank account, buy a car, open utility or mobile phone accounts, get medical treatment using your health insurance or commit a crime. Identity thieves can use stolen debit or credit card information to create counterfeit cards or use the card information to make online purchases. Brian Krebs, who runs the KrebsOnSecurity website, has found credit and debit card accounts with stolen information from Target customers have already been selling on the black market from $20 to more than $100 per card. In a blog post, Krebs, a former Washington Post reporter, details how the cards were being sold. It's quite scary.
More than 12 million people were victims of identity fraud in the United States in 2012 and criminals stole nearly $21 billion, according to Javelin Strategy and Research, which tracks identity fraud trends. Here's something to consider. Javelin found that consumers who had their Social Security numbers compromised in a data breach were five times more likely to be fraud victims.
We become more aware of identity theft when big breaches are disclosed. But many people make it easy for the theft of their information by identity thieves. When I do seminars on identity theft, I ask participants: "What's in your wallet?" It never ceases to amaze me how much personal financial information people carry around. One time a mother pulled out of her purse her children's birth certificates, Social Security cards and passports. She had registered the kids at a new school a few months earlier and had forgotten to put the information back in her file folder at home. Many people had laminated Social Security cards in their wallets. Others had old mortgage bills with them. Information about your lenders can be used in security checks to verify your identity.