At Retirement Planning Center, we are committed to protecting your identity and your financial future.
On September 7th, news of an Equifax data breach rocked the country as they announced that the personal information of approximately 145 million Americans may have been compromised. Almost immediately, experts and media outlets suggested that consumers consider options such as credit freezes, fraud alerts, and credit monitoring services to protect our identity. In addition to those suggestions, we wanted to make you aware of a few less-publicized things you might want to consider.
Fraudulent Annuity and Insurance Withdrawals
Insurance companies are reporting a rise in fraudulent withdrawal and transfer attempts. Basically, criminals submit phony paperwork in an attempt to withdraw funds from accounts that are not their own. Because of this, some companies are implementing additional procedures to verify the validity of withdrawal requests, such as making verification phone calls prior to authorizing certain transactions. These measures are being put in place to protect you, the customer, and the companies will do their best to keep the delays to a minimum. The IRS has posted an alert on their website about a similar scam aimed at tax professionals.
What should you do? Simply, be aware that if you need to make a withdrawal from an annuity or insurance account, you’ll want to plan for a couple extra days of processing time. Furthermore, if you notice any unauthorized activity in your account(s), please contact our office and the insurance company immediately.
Stolen Social Security Benefits
If you haven’t filed for Social Security benefits, here’s something you should be aware of. Armed with your personal information, a cyber-criminal could theoretically establish an online Social Security account in your name, file for benefits as you, and then direct those benefits to himself or herself without you even knowing about it. Then, when you go to file for benefits later on, you’ll learn that “you” already filed for benefits years ago.
What should you do? If you haven’t done so already, you should immediately create an online Social Security account. This will prevent someone else from doing it before you. One thing to keep in mind – if you have a credit freeze in place, you will have to unlock your credit file before you open your account. Alternatively, you can open an account in person at the local Social Security office.
Phony Tax Returns
The IRS estimates that in 2016 it paid out $239 million in “suspect” tax refunds. How does this happen? It’s simple. A criminal uses a stolen identity to file a phony tax return, and has the refund sent to them. In light of the Equifax breach, the IRS is gearing up for a continuing battle against this scam, which is one of the top scams on their annual “Dirty Dozen” list.
What should you do? Be prepared to file your tax return right at the start of tax season. Make a list of documents you’ll need, gather receipts and records ahead of time, and monitor your online accounts. Then, once everything arrives, get your return filed as quickly as you can.
In Conclusion
As Benjamin Franklin said, "An ounce of prevention is worth a pound of cure." It might not hurt to take a couple extra steps now to prevent serious headache later on. If you would like to discuss any of these items in more detail, please don’t hesitate to reach out!