Protect Yourself From Identity Theft

Protect yourself from identity theft and don't trust anyone else to do it for you. Recently, Wired.com reported that Judge Rules LifeLock’s Fraud Alert Service Illegal. Fraud alerts are a free service that "indicates to anyone requesting your credit file that you suspect you are a victim of fraud." LifeLock charges over $100 per year, per adult to provide services that are either free or a fraction of the cost. Here is what you can do to protect your identity:

1. Protect your social security number. Make sure you do not have any identification cards in your wallet that contain your SSN. Most insurance cards have stopped using your SSN as the identification number, but double-check just to make sure.
   
   Make sure your SSN is not included on your pay stubs. The only two places your employer should have copies of your SSN is the W-4 in your personnel file and in the payroll system.
   
   Do not give your SSN to any business, including most health care providers. If you need to borrow money, you more than likely will have to provide them with it.
   

   You generally are not legally required to provide your Social Security number to most businesses - including most health care providers... However, some companies might refuse to do business with you... There is no law that prevents businesses from requesting your SSN, and there are few restrictions on what businesses can do with it. (http://www.privacyrights.org/fs/fs10-ssn.htm#11)

2. Get insurance. Add a rider to your homeowners' insurance policy. This will cover the expense associated with cleaning up your identity. The cost is minimal and takes about five minutes.
   
   
3. Review your credit report annually. You can obtain your credit report for free from AnnualCreditReport.com. It take just a few minutes to download your credit report, but set aside 20 minutes to review it. The report provides enough information to close any account that is open that you are not using. Also, look for any accounts that you did not open.
   

   AnnualCreditReport.com is the ONLY authorized source to get your free annual credit report under federal law. The Fair Credit Reporting Act guarantees you access to a free credit report from each of the three nationwide reporting agencies — Experian, Equifax, and TransUnion — every twelve months. The Federal Trade Commission has received complaints from consumers who thought they were ordering their free annual credit report, but instead paid hidden fees or agreed to unwanted services. Don’t be fooled by TV ads, email offers, or online search results. Go to the authorized source when you request your free report. (http://www.ftc.gov/freereports)

4. Opt-out. Tired of getting junk mail? Worried that it may include personal information that you don't want falling into the wrong hands? Call (888) 5 OPT-OUT -- (888) 567-8688 to opt-out of receiving these mail solicitations. One pitfall is that the phone requires you to give them your SSN. Alternatively, you can opt-out at https://www.optoutprescreen.com.
   
   
5. Put a freeze on your credit. You will need to contact all three credit bureaus to set this up (Equifax, Experian, TransUnion). This is better protection than the 90-day fraud alert.
   

   A security freeze gives consumers the choice to “freeze” or lock access to their credit file against anyone trying to open up a new account or to get new credit in their name.
   When a security freeze is in place at all three major credit bureaus, an identity thief cannot open a new account because the potential creditor or seller of services will not be able to check the credit file. When the consumer is applying for credit, he or she can lift the freeze temporarily using a PIN so legitimate applications for credit or services can be processed.
   (http://www.consumersunion.org/)

You may also want to consider Identity Theft Alerts. I, personally, subscribed to this service for about 18 months. I liked it because anytime there was activity to my account, I was immediately notified. I did not like it because it is negative assurance and after-the-fact. I was only alerted if there was activity. I would prefer to be notified monthly that there was no activity, also. I decided to save the money and use my free annual credit report. Equifax's product costs $12.95 per month and monitors all three credit bureaus.

Companies like LifeLock offer to do some of the above -- for a monthly fee. However, they want your social security number and other personal information. Plus, you can do everything they offer for a fraction of the cost. Don't trust a contoversial company to do it for you.

For more information:

http://www.identitytheft.gov/

http://www.ftc.gov/bcp/edu/microsites/idtheft/

http://www.ssa.gov/pubs/idtheft.htm

Why I Love Running (And Those Who Run)

I enjoy running more now than I did when I ran competitively in high school and college. Back then, I ran for the race and did not appreciate all the aspects of running. Now I love the sport of running for the comradery, fitness, wellness, inspiration, technology, and discipline.

Comradery - My company started a fitness program in which employees could volunteer to sign an agreement to reach a stretch goal they set for themselves. If you meet your goal, you get to keep an iPod Nano and NikePlus chip used to track your progress. It has been a real team-building experience that gives us a common bond that did not previously exist. Outside the Firm, I have connected with other runners. There is a bond created from talking about personal bests, distance, pace, time, races, etc. It beats talking about the weather.

Fitness - After college, I basically stopped running all together. For a few years, until the birst of my firstborn, I played volleyball. Since then, I have had no fitness plan. As of January 1st, I committed to running 25 miles per month. That's equates to about 20 minutes of running three days a week (or one hour a week). Running has given me more energy and gotten me back in shape.

Wellness - Since running, I have lost weight, lowered my blood pressure, lowered my resting heart rate, and improved my flexibility. Lifestyle changes can reduce the risk of diseases like diabetes and heart disease.

Inspiration - Sarah Stanley runs 50 miles to inspire someone to run or walk 1 mile. Thomas Powell is a marathon runner who went from 230 to 168 pounds. Clay Noe literally had his leg ripped off 22 years ago and ran a mini-marathon this year in under three hours. (noefool.com) Most of the runners I know started running in their mid- to late-twenties. I know of one who started in her early fifties. I believe anyone can become a runner. These stories inspire me to set goals, overcome obstacles, and focus on the positive.

Technology - I absolutely love the new technology that was not available when I ran competitively close to 20 years ago. We used to have to drive around in our cars to map a run. Now it can be done online with Google maps or MapMyRun.com. I wear a GPS unit on my wrist that tracks pace, distance, time, heart rate, and more. Even the running clothes have made huge advancements and made running more fun. However, one only needs a good pair of running shoes to get started running.

Discipline - What is the definition of success? Success is simply the accomplishment of a set goal. If one sets a goal to run 200 miles in eight months, the goal can be broken down into monthly goals, weekly goals, and daily goals. With each run, one can set goals, or challenges. One of the most rewarding aspects of running is setting new personal bests.

I took this blog post in a slightly different direction than the goals I have set for this blog, but I think the lessons from running are tranferrable to business leadership.

The Fraud Pyamid

One of the more popular posts on my blog is my discussion of the Fraud Triangle. Fraud hit the news again this week with an article in CFO.com, Fraud takes many forms. Count on all of them to increase this year. I became aware of the article from following Cindy Kraft (aka @cfocoach) on Twitter. She posted the following tweets from the article:

To minimize fraud, CFOs need to set the tone for ethics & integrity and consider culture fit for all hires.

One psychological trait that is a useful indicator of a predisposition to fraud: perfectionism. Richard Davis, RHR Int'l

On average, it takes 2 years from the time fraud starts until is is detected; 46% are exposed by whistle blowers.

In tough times, fraud increases. 34% of frauds are perpetrated by ppl living beyond their means.

This reminded me of what I have coined the Fraud Pyramid. It is based on the Safety Pyramid that I learned when auditing manufacturing companies. Safety is primary concern for manufacturing companies and there is a widely-held theory that if a company can reduce minor injuries and near-accidents, a company will reduce catastrophic accident. According to Wikipedia, the safety triangle was introduced in a 1931 book by H.W. Heinrich's that states:

Herbert William Heinrich analyzed 550.000 occupational accidents and noticed that there is a constant ratio between fatal, light and near-accident of 1:29:300. In conclusion it is useful to analyze the frequent near-accidents to detect organization problems and intervene before a fatal accidents happens.

Although I have not read any empirical evidence to support my theory, I believe this concept also applies to fraud. If a company can reduce minor theft, then it can also reduce major fraud schemes. For example, does your company have a policy regarding personal usage of company credit cards? Does it specifically state that personal use of credit cards will result in disciplinary action including and up to termination? If not, what is that communicating to employees? That which you tolerate, you promote.

I am not suggesting companies dead-bolt the supply closet, but I am suggesting that clear communication of what is right and wrong will go a long way to preventing major theft. In fact, I would encourage generosity with the supply closet. Tell employees that they are free to occasionally take home certain office supplies for specified reasons. All you have to do is ask. This clearly communicates that taking stuff without obtaining proper approval is theft, even down to the pens in the supply closet.

Monitoring sensitive activities and enforcing well-communicated antifraud policies play an important role in preventing lapses from becoming crimes. The goal should be to arrest bad judgment before it becomes fraud, says fraud-prevention expert David Dixon of Norkom, and to use coaching as a way to keep certain employees on the right track. CFO Magazine (emphasis added)

Finally, it is your role as the leader in your organization to set the tone; to be the standard-bearer. What are you communicating when you use the corporate card for personal usage? What are you communicating when you allow questionable invoices to flow through accounts payable?

For all the new research into fraud prevention, experts are unanimous about one thing: "tone at the top" counts for a lot. That was a vital finding of the National Commission on Fraudulent Financial Reporting, aka the Treadway Commission, in 1987. "The tone set by top management," the commission concluded, "is the most important factor contributing to the integrity of the financial-reporting process." CFO Magazine (emphasis added)