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Identity Theft & Common Fraud 101

Identity Theft & Common Fraud 101: ID Theft

ID theft occurs when someone obtains your personally identifying information, ( i.e. your name, social security number or your credit card number) and uses this information to commit fraud and/or other crimes. This can happen to anyone even young children and is a very serious crime with catastrophic side effects to the victim. The side effects of this crime can go far beyond just ruining your credit.

The Federal Trade Commission estimates as many as 9 million Americans have their identities stolen every year. This is a constantly growing problem and has proved to be one of the most challenging crimes to combat in our nation.

Identity theft takes on many different forms such as thieves trying to rent an apartment, purchase, house etc, all in your name. Thieves can fraudulently open credit cards or telephone accounts in your name and can even prevent you from finding out by forwarding your mail to a different address. Using these techniques a victim would not receive bills or phone calls regarding new accounts opened in their name. These are just a few examples of ID theft. Criminals are becoming more and more evasive and creative when it comes to committing this type of crime, and are able to draw it out so that no one is even made aware they have done so for several years. The complexity of this crime is also becoming more intricate. Criminals are discovering new ways to profit/benefit by utilizing your identity.

The following information is general, not necessarily specific. WHY? Because the nature of identity is so complex and is constantly changing, criminals are becoming more and more evasive and finding new ways to commit this crime. SecurityGrade does constant research to stay current on new tactics on how to prevent this growing crime. If we publish more in depth and specific information on the subject our users would be reading thousands of pages of information, some verified and some here-say. This information would also include some tactics for preventing ID theft that work for some but not others. SecurityGrade realizes the best way to educate people is to tackle the challenge of education on the more common methods of this crime and how to prevent it, more specifically elaborating on information that pertains to them personally. If at any time a member wishes to receive any further information on any subject, or even ask various questions about Identity Theft, they need but ask…. We are more than happy to hear from our users and encourage them to ask questions, more specifically questions that are more personal to them. It is our sincere wish to help educate and guide Americans through avoiding this crime as well as helping victims recover as quickly as possible.

How does it happen?

(Remember, the following are just some general ways, please contact SecurityGrade for further information/question regarding anything specific you would like elaborated)

There are several ways this type of crime can occur, however, the main reasons that ID theft occurs are negligence and misuse. Criminals will misuse your personally identifying information like your social security number or other information and may commit a variety of crimes such as credit card fraud, bank/finance fraud and government document fraud just to name a few. In some extreme cases, criminals can get a job under your name, rent an apartment or even have you falsely arrested.

Common ways thieves steal your identity.

Stealing– A thief may steal your wallet, purse, mail (with credit card and bank statements in it), checks, and personnel records just to name a few.

Dumpster Diving– Thieves will go through your trash/dumpster looking for documents/papers with your name and/or any personal information on it.

Phishing– Thieves may pretend to be a bank or some other financial institution to gain your personal information. This can be done through spam or pop-up messages on your computer. (Keep in mind, spam and pop-up blockers do not necessarily prevent this)

Skimming– Thieves can steal your sensitive personal information from your credit cards by scanning them on to special electronic storage devices. (This can be done from your local shopping center or ATM without your knowledge, as well as it can be done simultaneously as your credit card is swiped for authorized purchases.)

Changing Your Address– Thieves can have your billing information sent to them to gain more critical information about you to steal your identity.

Pretexting– Pretexting is essentially someone obtaining your personal information by pretending to be someone they are not, a sort of social engineering. So called con-artists are well known for this type of crime. This can be done on some of your favorite websites like or over the phone while you are giving information to which you believe is conducting a simple retail survey.

How is my identity abused once it is stolen?

A thief’s job gets much easier once they have your information. The most typical desire of criminals who have committed identity theft is to steal your money.  However, thieves may also commit crimes such as:

Credit Card Fraud– Thieves can open credit card accounts in your name and then max out the cards. When thieves use these cards they do not pay the bills and you may or may not receive delinquent notices, depending on whether or not they have forwarded your mail to a different address. In this particular case, it can take several years before a victim even realizes that this has occurred.

Phone/Utility Fraud- Thieves can open new phone lines under your name, or transfer billing information of existing phone lines over to your name. Thieves can even set up their internet, cable TV, electricity, heating bills, etc, all under your name without your knowledge.

Bank/Finance Fraud– Thieves can create counterfeit checks using your name and account info or they can open an account under your name and write checks from these accounts with insufficient funds. Thieves can clone your ATM/Debit card and start withdrawing money from your account. (A lot of Americans believe that financial institutions have sophisticated computers that will not allow cloned cards to function because they monitor unusual spending habits, however, this is not the case. For example, if a thief uses a cloned card within the general vicinity of where you live or on the internet, it is currently far more difficult for computers to detect these unusual spending habits.)

Document (Government) Fraud- Thieves can obtain a government issued ID card (driver’s license) in your name but with their picture on it. They can file taxes under your name and receive your tax return. They can even claim government benefits that are rightfully yours, ( i.e. your disability or retirement benefits.

Other– Thieves can get a job using your name, use your medical benefits, and literally live “your” life with your benefits, all without your knowledge.

How do I know if I’m a victim?

There are various ways to find out if you are a victim of ID theft and even further more critical actions you must take if you are certain that you are a victim.

The best way to determine if you have been a victim of ID theft is to monitor your bank account(s) and your credit history regularly.

Monitoring your bank account(s) and your credit card statements.

Monitoring your bank account(s) and your credit card statements is fairly simple. Every few days, if not every day you should take a look at your bank statements as well as your credit card statements. Nowadays this is easily done online through most major financial institutions, however by phone and by mail are some alternative methods.

What am I looking for?

To identify if you may be a victim of ID theft you must look for anything out of the ordinary, more specifically transactions out of the ordinary. No one knows your spending habits better than you do, so something like a $5,000 transaction for a new flat screen television, when you obviously haven’t purchased one should be a major red flag. Remember, this goes beyond just common sense, thieves can be very sneaky when it comes to committing fraud. For example, they could be just pulling out cash advances for only a couple of dollars at a time. Or they could be purchasing little things like iTunes songs for 99 cents a pop and the likelihood that you would notice such a small change in your balance is slim. Therefore, do not just look at your balance and say “hmmmm, ok, that’s about right.” Question anything out of the ordinary. You may be thinking, “how are criminals getting rich by only withdrawing a little at a time from my bank account?” The answer is, they’re not, however if they withdraw a dollar from you and you don’t notice along with 5,000 other people, that’s a pretty good payday. This is called financial trickling.

Looking through your statements and spotting something out of the ordinary will be much easier if you look over your statements often. Anything that doesn’t make sense should be questioned. If you spot something abnormal, you should contact your financial institution immediately and tell them you want to file for fraud.

In most cases, banks will not hold you liable for fraudulent charges, however, there are strict rules that apply to reporting fraud and some institutions have a time limit that someone may file for fraud with regard to a particular transaction. For example, a bank may only allow a fraud case to be established if it is reported within 6 months from the date of the fraudulent charge.

It is true that larger financial institutions have sophisticated computers with software that can detect abnormal transactions. For example, you may recall at one time or another receiving a phone call from your bank’s computer asking if you had authorized a specific purchase. However, keep in mind, these safeguards only minimize the chances of a fraudulent charge from occurring.

Monitoring your credit history

Monitoring your credit history can be fairly simple and should be done often, at least every six months. Keep in mind, each of the 3 credit bureaus, by law, must provide you with 1 credit report per year at no charge upon request. That’s 3 free credit reports per year.

When looking at your credit report, you should again look for anything out of the ordinary. Note: Your credit report might not reflect all of your current accounts because not all creditors report to all 3 bureaus.  As you may already know a credit report shows detailed information on things such as:

Identifying information: This would be your name, address (possible former address), phone number, social security number, possibly your current employer and/or past employers addresses. (If any of this information is inaccurate, you should contest/report it to the bureau presenting the information.)

Your credit history: This is the meat and potatoes of your report, it will show your debt, current credit available, whether or not you have made late payments or no payments, as well as various other information. (If any of this information is inaccurate, you should contest/report it to the bureau presenting the information.)

Public recordings: This section will show filings of bankruptcy or any potential court judgments against you. For example potential property liens. Items such as these will stay on your report for at least seven years, and 10 years if you have ever filed for bankruptcy.

Credit Inquiries: Anytime you or anyone else does a credit check it will show up on your report as an inquiry. There 2 types of inquiries: Hard inquiries and soft inquiries.

Hard inquiries: These will show up when you are applying for a loan or for credit cards.

Soft inquiries: These will show up if you request your own credit report or if someone does a credit check for employment purposes. Soft inquiries do not stay on your credit and do not reflect negatively against you.

Remember that the 3 credit bureaus are not obligated by law to give you your credit score at no cost, only your credit report. Also, remember that a credit report does not necessarily include a credit score.

General Fraud (Avoiding the most common types of fraud)

You may think you’ve heard it all, you may have even preached about it to family and friends; the horror stories of people you know or maybe even yourself falling victim to fraud. Practice what is Preached… Avoiding fraud is your best defense. Having a good education of the most common types and how to avoid them will save you time, money and energy. The statistics are staggering yet unclear as to the accuracy of how much money Americans lose to fraud every year, yet the issue is a well known public threat. strives to educate its users to the most common forms of fraud to more specific rare forms. Never hesitate to ask further questions, share a story or seek specific consultation unique to a potential form of fraud that you have fallen (or think you have fallen) victim to.  This document discusses the common forms of fraud, more specifically the white collared predators (Fictitious or real businesses) who commit fraud mostly by mail (whether electronically or by physical mail). is refraining from discussing in depth about identity theft on this document so as not to re-iterate the same information that is already discussed on the related documents.

-Fraud: (noun)

deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage.  -Webster’s Dictionary

Some of the most common forms of fraud:

-Identity theft


-Confidence fraud

-Benefit fraud


-Tax fraud

-Bait and switch

-Bankruptcy fraud

-False billing


-Insurance fraud

-Securities fraud

-Marriage fraud

Although these are the most common forms of fraud in America, will discuss a few of these, how they are typically committed and go over several ways to best prevent you from falling victim to fraud.

Forgery can be done on many different levels, electronically and physically. It is best to keep your signature consistent, meaning write it the same way every time. You are the best judge of your signature and can tell when someone has forged your name if your signature has its unique qualities about it that are intricate to you and you alone. Question signatures on documents that you may not recognize and don’t remember signing. Blow the whistle and contact proper authorities whenever you’re sure your signature has been forged.

The confidence scheme (fraud) is very broad. Some of the more typical forms of confidence fraud are the 419 scams. 419 scams are scams that eventually trace back to an area of Nigeria where lot of criminals attempt to contact various people throughout the world, more specifically America, and scam them via the internet and by mail (electronically and physically). The 419 scammers try and pose as legit business people who may try to convince you of an inheritance that you are owed, loans with no interest that you are pre-approved for, deals to purchase products a extremely low rates and money exchange scams to name a few. The list of 419 scams goes on and on. The 419 scammers will flood your inbox with various baiting letters to try and convince you that they are trustworthy, then fraudulently take your money. There is always your money involved with this scam and there are many tell-tale signs that allow you to recognize when you are being baited. Most of the time, common sense is the best virtue to your success at avoiding these scams. Keep in mind that these scammers are not limited to just the 419 area of Nigeria. There are predators all over the world who try to commit this crime for reasons of convenience of being so far away and the rarity of the perpetrators ever being extradited for prosecution. They know that there is virtually no chance you will catch them. Statistically they are right; you must know how to avoid them.

It is easier to know how to identify fraud for yourself rather than listing the hundreds of different forms of fraud. Any type of fraud that can be harmful to you or your family and friends is the type to watch for. Your mentality must change toward combating this public threat before you can effectively engage in deterrence and/or recovery if you have been a victim.

  • Anything that sounds too good to be true probably is. Question the amazing opportunities that randomly come your way (especially by mail) that promise to change your life financially, but yet you must pay first.

  • Trust your judgment and take into consideration past horror stories you may have heard from family and friends about fraud.

  • Any business that seems unfamiliar or doesn’t look legit should be questioned. You can always try to verify that the business actually exists. The Better Business Bureau is a good source to verify existence and credibility however not all legit businesses are in The BBB’s database. Do your own research.

  • Anyone or business that is trying to reach out to you and offer you money for exchange of currency or to overpay you for an item you have put up for sale, then request the difference, may be trying to scam you.

  • Be EXTREMELY cautious when giving out personally identifying information over the phone and/or via e-mail. Remember banks will typically NEVER ASK for your account number by phone or email.

  • Monitor your credit carefully. Remember it’s free and you can be a better babysitter of your personal credit than any credit monitoring company. See Identity Theft 101

  • Never give money, especially through wire transfer to people you don’t know on domestic grounds or internationally.

  • Never participate in foreign lotteries. They are illegal in the United States.

  • Be cautious when tempted to engage in “Work-from-home” job offers.

  • Monitor your bank accounts.

  • Contact the U.S. Postal Inspection Service if you feel you have received any type of fraud by mail:

Criminal Investigations Service Center

ATTN: Mail Fraud

222 S. Riverside Plaza, Suite 1250

Chicago, IL 60606-6100

Or by telephone:


Or Web:

  • Keep educating yourself on the latest ways to maintain your safety from fraud by constantly visiting

What do I do if I’m a victim?

Step 1: Stay Calm…. If you stay calm and keep a level head about being a victim of ID theft it is far more likely you will come out on top. It is important that you keep a good mindset when going about the next steps. You may find that law enforcement, credit bureaus, and even financial institutions are very helpful when it comes to assisting victims of identity theft.

Step 2: Determine the nature of the crime. Was your credit/debit card used fraudulently? Has someone opened a line of credit under your name and/or information? Consider contacting the institutions to which the fraudulent charges/accounts involve. For example, if your bank statement shows unauthorized purchases, this could be a result of debit card or check fraud and you should contact your bank and file a fraud claim. The same goes for an unauthorized line of credit. Contact the creditor and file for fraud through them. Note: If you are certain that only your debit card or credit card was used fraudulently and your financial institution has agreed to reimburse you and not hold you liable for fraudulent charges (which is usually the case), it may not be necessary to proceed with the remaining steps. Regardless, it can be a good preventative measure.

Step 3: File a report with the FTC (Federal Trade Commission): You should file a report of ID Theft through the FTC and show a printed copy to law enforcement in step 4.

Step 4: Get a police report and present the ID Theft complaint.  Law enforcement typically knows exactly what questions to ask when dealing with ID theft victims. Their questions may even shed light on various other circumstances about your case that you may not have known. The main benefit of a police report is that it grants you certain legal rights. All 3 credit bureaus will want a copy of this report and it will help to put a halt on your identity theft. Collection agencies may stop collecting as a result of your case and your personally identifying information will be better safeguarded when presenting this report to the credit bureaus. In some cases you may not need a police report; however it will help your credibility with regards to you being victimized.

Step 5: Consider setting up Credit Fraud Alert. This can be better determined whether or not you should take this step by Law Enforcement and/or the FTC (Federal Trade Commission). This step will depend on the severity of your particular case.

Preventative Measures (Reducing your risk)

Remember, there is currently no way to completely protect yourself from being a victim of identity theft. The chances of it occurring are increasing, however that is no reason to fear it. The best ways to combat this is to adhere to various preventative measures and know what to do to recover quickly if you become a victim.

Preventative Measures

-Monitor your credit. This is arguably the most important thing you can do to babysit your identity is to see whether or not you’re a victim of ID theft as well as this forces your eyes open to potential attack. This can be fairly simple if you do it often, a minimum of once every six months. Keep in mind that each of the 3 credit bureaus, by law, must provide you with one credit report per year at no charge upon request. That’s 3 free credit reports per year. It can be helpful to pay into services that monitor your credit and offer identity theft insurance. However, remember that these companies take the same steps you can take (at no charge) to ensure the safety of your identity.

-Invest in a shredder. Nowadays, people get piles of mail (some junk and some not) sent to them. As you are going through your mail, be conscious of any mail that has your personally identifying information on it. If you don’t need to keep this paperwork, shred it before you throw it out. (Cross-cut shredders are best.)

-Frequently change your passwords. This refers to all passwords that apply to anything that may unlock your personally identifying information. For example, bank account info, credit card info, credit history info, documents that contain social security numbers, addresses, current or past employment info, etc… This could be stored on your computer, within your email account, and within your personal safe. Consider changing the passwords to anything that contains your personally identifying information.

-Have phone numbers and web addresses ready. When and if, you ever become a victim of identity theft you will need to make contact with several organizations to address your issue. Have these numbers and various web addresses ready (not just in your wallet or purse but somewhere safeguarded in your home or work as well.) Click here for pertinent information to various organizations that will assist you.

-Exercising Awareness. This is a broad measure that applies to many areas. To name a one, be more conscious of Pretexting. Pretexting is becoming more prevalent as people are becoming more social, both in the physical world and in cyberspace. It is not as difficult as you may think to gain essential information about you that can be used to commit identity theft. This form of social engineering is being done all of the time on social networking websites (i.e.,, over the phone and by email. Do not volunteer or give in to anyone requesting personally identifying information that you do not feel or know for sure has legitimate, legal and moral obligations and standards to care for your information. The awareness aspect is really up to you using your best judgment.

What You Don’t Know About ID Theft Protection Companies

ID theft protection companies provide you with a service for a fee, even though this service is literally free. Short of the insurance that only some offer, there is nothing they do that you can’t do for FREE! Consider even the more modestly priced companies, let’s say for example that charge $10 per month, do the math… that’s $120 a year. $120 a year that they take from you when you can take a few moments for yourself a few times a year to monitor your credit. These companies are not necessarily ID Theft Protection Companies, as much as they are credit monitoring companies. Most of these companies do nothing more than assist you in taking care of a few government mandated resources to aide in your recovery from ID Theft as well as give you advice on how to reduce your risk of ID Theft.

Credit Fraud Alert

Credit Fraud Alert can greatly help reduce your risk of ID Theft, if your personally identifying information has been compromised (potentially exposed to those who should not have it.) It will alert creditors to contact you if anyone tries to open an account with your information; however it is not necessarily mandatory for them to contact you. Note that law enforcement or the FTC (Federal Trade Commission) may suggest whether or not this is necessary for you. There are 2 degrees of fraud alert:

90 Day Alert: This will set a temporary fraud alert for you for a 90 day period and automatically ends on its own unless you renew the alert. This alert can be submitted online or my mail.

7 Year Alert: This is known as an extended fraud alert. You will typically have to provide proof that you are a victim of ID theft in order to have this alert enabled.

Drawbacks of Fraud Alert: Bear in mind that this can become a nuisance if you are trying to apply for various credit cards, bank loans, etc. Creditors will want to be put in contact with you to be sure you are who you say you are and not someone else applying for credit under your identity.

Credit Freeze

A credit freeze will help to prevent thieves from opening most types of accounts under your identity. Keep in mind this is not necessarily advisable if your information has only been compromised and you are unsure if your identity has been stolen; however more advisable if you are certain it’s been stolen. A credit freeze may be suggested by law enforcement and/or the FTC. In some cases a small fee may apply to enable a credit freeze.

Thanks for reading and please feel free to reach out to us at any time to speak with one of our security experts.

Formerly Security Grade Protective Services, Helix Cannabis Security provides end-to-end security services for licensed cannabis businesses or traditional industries. Follow us on FacebookLinkedIn andTwitter for security best practices, tips and company updates.