Tips on Avoiding Identity Theft

By Peter Rudegeair 

Identity fraud kept rising last year in the U.S., despite the rollout of new security chips on U.S. credit cards.

A new study Wednesday reported that identity fraud hit 15.4 million U.S. consumers in 2016, the highest level in more than a decade. To protect credit and debit cards and online bank accounts from fraud, Javelin Strategy & Research, which co-wrote the report with identity-theft protection firm LifeLock Inc., recommended consumers follow the following tips:

Sign up for transaction alerts. Growth in identity fraud was driven by criminals buying goods and services online with stolen card information, what's known in the industry as "card-not-present fraud." By opting into email or smartphone alerts every time a transaction is recorded on a card, customers will be able to detect fraudulent activity more quickly, ideally preventing the follow-on fraud that sometimes occurs in the days and weeks after the initial breach.

Consider mobile wallets. Apple Inc's Apple Pay and Alphabet Inc's Android Pay are among the mobile-payment options that don't share a consumer's credit-card details with merchants when a purchase is made. These services generate a unique token to authorize a transaction, so if hackers breach a merchant's payment system, they wouldn't be able to steal the underlying credit-card data of mobile-wallet users.

Go private. Swindlers often comb through social media to get clues to a consumer's personal information and use them to take over accounts. Setting strong privacy controls and validating accounts with obscure "challenge" questions instead of more-easily tracked personal data should limit those kinds of fraud.

Write to Peter Rudegeair at [e-mail]

(END) Dow Jones Newswires

February 01, 2017 14:17 ET (19:17 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.