Tips for Preventing ID Theft

and Financial Fraud

The Javelin 2008 Identity Fraud Survey Report estimates that 8.1 million American adults were victims of ID theft in 2007, losing a whopping $45 billion. Victims have been losing more over the last three years, with cost-per-consumer now nearly $700. For businesses, the costs can be disastrous. For example, two men were convicted in federal court for an attempt to assume a company's identity and collect $23 million owed to the real company.

From online data breaches and "dumpster diving" outside of businesses to stealing checks from mailboxes and "shoulder surfing" at ATMs for PIN information, white-collar criminals are creative and determined in using both low and high technology. Fraud victims face dire consequences such as badly-marred credit or criminal records in their name, which take years to clear up.

Jim Lynch is president and CEO of Leaders Bank, which caters to privately held businesses. He offers the following advice to consumers and business owners:

• Don't discard intact receipts containing social security or credit card information. Use an inexpensive cross-cut paper shredder to eliminate this risk.
• Avoid using obvious account passwords, such as birthdays or a mother's maiden name.
• Check credit reports regularly. Take advantage of the website http://www.annualcreditreport.com/ to obtain a free credit report annually from each of the three nationwide credit reporting companies. Federal law entitles you to this service.
• Cut up expired credit cards and close accounts unused for six months. Limit the number of pre-approved credit cards you receive by calling 1-888-5OPT-OUT. This helps ensure thieves can't steal and complete a credit offer and have new cards sent to themselves.
• Don't keep anything in your wallet containing your social security number. Criminals can use your number to apply for bank loans, jobs and credit in your name.
• Have new checks sent to your bank versus your home and mail bills from U.S. mailboxes instead of residential mailboxes, which criminals target for checks they can launder and reuse.

For business owners:

A component of every company's cash management strategy should be mitigating the risk of fraud. The popular crime of check fraud accounts for more than a quarter of fraud. The following measures add protection for a business owner's payables and receivables, and include solutions available from Leaders Bank:

• Remote Check Deposit. Aside from the benefits of speeding conversion of receivables into payment, this service allows a business owner to quickly learn of any issues with receivables and take action. Instead of making a trip to the bank, a business deposits checks by processing them through a remote check scanner.
• Positive Pay. With this easy-to-use web-based solution, a red flag against any suspicious checks is raised by having the bank compare a list of a customer's issued checks against checks clearing on the customer's account. For example, if one is written for $100, but is presented to Leaders Bank for payment of $1,000, the customer is immediately notified with the option of giving a "pay" or "no pay" decision.

ACH Blocks and Filters. These tools help prevent fraudsters from targeting electronic funds clearing. ACH Blocks reject all ACH debits to blocked accounts, while ACH Filters post debits to an account only from preauthorized parties or in preauthorized dollar amounts.

• Use time-tested check-handling measures when accepting checks for payment. Verify identification and then record that information. Don't accept a check as a replacement for a previously dishonored check or as partial payment for a bad check. Also, don't return the bad check if the issuer asks for it.
• Be aware of the numbers on checks. Low check numbers indicate the account has not been open long. Exercise caution if the number is under 125 and handwritten. Don't accept a post-dated check or one that the issuer has asked you to hold until a specified date. Also, ensure that the numeric value of the check matches the written value.
• Finally and perhaps most importantly, establish regular communication with your banker.

"Having a banker to easily turn to for advice is always important," says Lynch. "Your banker can offer personalized advice on how to prevent identity theft and fraud, or help with any other financial concern."

Location and Lobby Hours

Headquarters
2001 York Road, Suite 150
Oak Brook, IL 60523

Phone: 630-572-5323
Fax: 630-572-4979

Hours
Monday - Friday
8:30 a.m. to 4:30 p.m.

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