Not long ago, when your bank was robbed or your home burglarized, it was easier to spot the attack and take immediate action. In today’s environment of cyber fraud, you’ve likely noticed an increase in disquieting reports such as data breaches at major retailers, leaving you uncertain whether they have impacted you, or how to respond if they have. As quickly as we devise tighter security measures, the bad guys seem to devise new ways to work around them.
In short, identity theft is alive and well. In a 2013 SEC Open Meeting, SEC Chair Mary Jo White estimated that 5 percent of U.S. adults fall victim to cyber crimes each year.
That’s not to say there’s nothing you and your financial advisor can do to protect against cyber crime. Just as you still lock your front door even though a bad guy could break a window instead, there are basic steps you can and should take to limit your vulnerability.
Know the Enemy
First, it helps to know what you’re up against. If you can recognize a threat before it plays out, an ounce of prevention can spare you pounds of complex cures. Following are three of the most common tactics cyber criminals use to steal your identity or login codes, using the information to drain your investment accounts and rack up unauthorized charge on your credit card.
1. Malware. The most common way to expose yourself to malware is by clicking on an unfamiliar link or opening an infected e-mail. Using malicious software, criminals snoop through your computer or mobile device, gathering sensitive personal information such as Social Security and account numbers, passwords and more.
2. Phishing. Phishing occurs when someone e-mails or calls you, pretending to be from a known entity such as your bank or other financial service provider, and asking you to disclose personal information. Reputable service providers do NOT contact you out of the blue and ask for personal information, so such requests should always raise your suspicions.
3. Social engineering. Cyber criminals are getting creative – and personal. Using social media, phone calls or other electronic media, they try to gain your or your advisor’s trust by using information they have acquired by phishing or other means. They press for additional information or payments, implying that time is of the essence or the matter is urgent. A common scam is to trick you into believing a beloved family member is in trouble and needs your immediate financial assistance. They also may contact your advisor, posing as you and asking for wire transfers out of your account (and into theirs). “Don’t talk to strangers” remains as true an adage as ever.
Lock Your Doors
The next step in your essential security measures is adopting a few proactive habits to help lock the doors to your personal information. Here are six basic safeguards.
1. Secure your electronic devices: mobile and desktop. Maintain strong passwords.
2. Lock up any paperwork containing personal information and use a shredder to dispose of it.
3. Install and regularly update anti-virus software on your devices and be watchful as you surf the Web; don’t click on links from unfamiliar sources.
4. Be guarded with your information and with whom you connect on social networks.
5. Protect your e-mail accounts and NEVER share sensitive information such as credit card or Social Security numbers in unencrypted e-mails or insecure forums.
6. Safeguard your financial accounts. To help block them from being compromised, NEVER provide personal or financial information unless you are certain that the request is valid.
7. A cyber criminal may be familiar with all sorts of personal information about you and your family, so be wary of urgent calls for “help” without taking steps to confirm their legitimacy.