C.E. Solutions Tracy Young ALHC, HIA, CLU 913-980-2348 continuingedsolutions

1. C.E. Solutions Tracy Young ALHC, HIA, CLU 913-980-2348 www.continuingedsolutions.com Identity Theft Deter-Detect-Defend

2. Identity Theft • Review and study this course at your leisure. • Once the course is completed, enter the exam through the ClassMarker link at the end of the exam. • You must receive a score of 70% or better to pass. • You may retake the test at no additional cost as needed. • The Insurance Department requires that all exams be taken in the presence of an approved disinterested 3rd party monitor. • Course Certificate will be faxed and sent electronically to the insurance department when notification of a passing score and an affidavit signed by the person monitoring the test is received.

3. C.E. Solutions The material presented in this course is for educational and informational purposes only. It should not be used to provide guidance to your customers or clients in lieu of competent, certified, legal advice. The parties involved in the development of this course shall not be liable for any inappropriate use of this information beyond the purpose stated above. As a student, you should understand that it is your responsibility to adhere to the laws and regulations pertaining to any aspect of this course and the materials presented within.

4. PRESENTATION OVERVIEW • What is identity theft? – 30 min. • How does identity theft happen? – 30 min. • What does it cost? - 15 min. • What can you do? – 30 min. • Deter (protect yourself!) • Detect • Defend • Where can you learn more? – 15 min. • Identity Theft Insurance – 30 min. • Coverage • Limits • Deductibles • What to consider • How Businesses can Protect our Information – 30 min.

5. Different laws determine your legal remedies based on the type of fraud you have suffered. • State laws protect you against fraud committed by a thief using paper documents, like stolen or counterfeit checks. • Federal law comes into play if the thief uses an electronic fund transfer or mail. Many transactions may seem to be processed electronically but are still considered “paper transactions.” What can you do? • While dealing with problems resulting from identity theft can be time-consuming and frustrating, most victims can resolve their cases by being assertive, organized, and knowledgeable about their legal rights. • Some laws require you to notify companies within specific time periods. • Don’t delay in contacting any companies to deal with these problems, and ask for supervisors if you need more help than you’re getting.

6. Different laws determine your legal remedies based on the type of fraud you have suffered. • State laws protect you against fraud committed by a thief using paper documents, like stolen or counterfeit checks. • Federal law comes into play if the thief uses an electronic fund transfer or mail. Many transactions may seem to be processed electronically but are still considered “paper transactions.” What can you do? • Most victims can get their cases resolved by being vigilant, assertive and organized. • Don’t procrastinate on contacting companies to address the problems. • Don’t be afraid to go up the chain of command or make complaints, if necessary. • Keep organized files. • You may want to contact an attorney or contact Legal Services in your state or your local bar association for help in finding an attorney.

7. What can you do? • Different laws determine your legal remedies based on the type of fraud you have suffered. • State laws protect you against fraud committed by a thief using paper documents, like stolen or counterfeit checks. • Federal law comes into play if the thief uses an electronic fund transfer or mail. Many transactions may seem to be processed electronically but are still considered “paper transactions.”

8. What does it cost? • Identity theft costs a record $56.6 billion in cash, goods, and services. Two thirds of victims have no out-of-pocket expense (because bank and credit card companies seldom ask victims to cover any charges). For about 3 million victims, the average cost of repairing their credit was nearly $1,200 and for all victims the average time to set the record straight was 30-40 hours. • 38-48% of victims find out about the identity theft within 3 months of it starting. 9-18% of victims take 4 years or longer to discover that they are victims of identity theft.

9. How do they do it? • New schemes like “phishing” or old-fashioned “dumpster diving”. • Some thieves use a simple electronic device to capture the information (sometimes from their car while you pay for gas at the pump).

10. “Spear Phishing” • An article from the K.C. Star, dated 4/5/11 … “Fraud email warnings spreading”. “Companies behind such brands as Chase, Citi and Best Buy said over the weekend that hackers may have learned their email addresses because of a security breach at a Dallas-based company called Epsilon that manages email communications.

11. “Spear Phishing” • “The hacker takes the email addressesand sends emails to random people, purporting to be from a large bank and asking them to log in at a site that looks like the bank’s site. Instead, the fraudulent site captures their login information and uses it to access the real account.” • The data breach makes “phishing” attacks more efficient, by allowing the fraudster to target people who actually have an account with the bank!

12. “Spear Phishing” • “David Jevans, chairman and founderof the non-profit Anti-Phishing Working Group, said criminals have been moving away from indiscriminate phishing toward ‘spear phishing,’ which relies on having more intimate knowledge of the victims.” • Protect yourself from this type of crime. Do not give any information out that is requested on the phone or computer, without first confirming with the real business.

13. New Credit Card Scam to watch for… • Caller: ‘This is (name), and I’m calling from the Security and Fraud Department at VISA. My Badge number is 12460. Your card has been flagged for an unusual purchase pattern, and I’m calling to verify. This would be on your VISA card which was issued by (name of bank). Did you purchase an Anti-Telemarketing Devise for $497.99 from a Marketing company based in …” • When you say ‘No’, the caller continues …

14. New Credit Card Scam to watch for… • Caller: ‘Then we will be issuing a credit to your account. This is a company we have been watching and the charges range from $297 to $497, just under the $500 purchase pattern that flags most cards. Before your next statement, the credit will be sent to (gives you your address), is that correct?’ • You say ‘yes’. The caller continues …

15. New Credit Card Scam to watch for… • Caller: ‘I will be starting a Fraud investigation. If you have any questions, you should call the 1-800 number listed on the back of your card and ask for Security. You will need to refer to this Control Number. (The caller then gives you a 6 digit number) Do you need me to read it again?’ • Here’s the IMPORTANT part on how the scam works…

16. New Credit Card Scam to watch for… • Caller: ‘I need to verify you are in possession of your card’. He’ll ask you to ‘turn your card over and look for some numbers’. There are 7 numbers; the first 4 are part of your card number, the next 3 are the security Numbers that verify you are the possessor of the card. These are numbers you sometimes use to make Internet purchases to prove you have the card.’ The caller will ask you to read the 3 numbers to him.

17. New Credit Card Scam to watch for… • After you tell the caller the 3 numbers, he’ll say, ‘That is correct, I just needed to verify that the card has not been lost or stolen, and that you still have your card. Do you have any other questions?’ • After you say ‘No’, the caller thanks you and states ‘Don’t hesitate to call back if you do, and hangs up.

18. How do they do it? • Stolen checks … All it takes to empty your bank account is a signed check and a pan of acetone, the active ingredient in nail polish remover. • The identity thief crook tapes over your signature front and back, and then soaks the check in acetone to wash away everything but the printer’s ink and your signature. • He then dries the check and carefully peels off the tape resulting in a blank check signed by you! • In addition, thanks to “bounce protection” from banks, the scamster can even overdraw your account.

19. New Credit Card Scam to watch for… • You actually say very little, and they never ask for your card number … But … all they need is that 3 digit number. They already had your card number and expiration date! • VISA or Master card will never ask for anything on the card as they already know the information.

20. How do they do it? • Social Security numbers – a California man, Jerry Van Le, age 30, was arrested in an ID theft ring. He has been accused of using stolen SS numbers to buy a new home, vehicles and electronics and then selling the information to others in a multimillion-dollar id theft ring. • He stole numbers from about 25 children, immigrants and others who had not yet established credit through his work as a mortgage broker. • He sold the numbers nationwide for between $3,500 and $6,00 each to about 2,400 individuals over the last 18 months. • It was a $100 million ring.

21. How do they do it? • Bankruptcy Fraud – If you believe someone has filed for bankruptcy in your name, write to the U.S. Trustee in the region where the bankruptcy was filed or check www.usdoj.gov/ust. Write a letter describing the situation and provide proof of your identity. • The U.S. Trustee will make a criminal referral to law enforcement authorities. • You also may want to file a complaint with the U.S. Attorney &/or the FBI in the city where the bankruptcy was filed. • You may need to hire an attorney to help convince the bankruptcy court that the filing is fraudulent.

22. How do they do it? • Passport Fraud – if you’ve lost your passport, or believe it was stolen or is being used fraudulently, contact the U.S. Department of State (USDS) through www.travel.state.gov/passport/passport_1738.html.

23. How do they do it? • Student Loans Fraud – Contact the school or program that opened the student loan to close the loan. • Report the fraudulent loan to the U.S. Dept. of Education at 1-800-MIS-USED; www.ed.gov/about/offices/list/oig/hotline.html?src=rt; or write Office of Inspector General, U.S. Dept. of Education, 400 Maryland Ave., SW, Washington, DC 20202-1510.

24. How do they do it? • Tax Fraud – Be alert to possible tax-related id theft if the IRS sent you a notice that: • States that more than one tax return was filed for your, or • Indicates you received wages from an employer you don’t know. • If the thief files the tax return before you do, the IRS will assume you already filed and received your refund.

25. How do they do it? • If a person used your SS number to get a job, that person’s employer would report income earned to the IRS using your number, making it appear that you did not report all of your income on your tax return. • If you receive a notice, please respond immediately to it. If you have been in contact with the IRS (800-829-0433 or www.irs.gov) or if you have not been able to resolve the matter, contact the IRS Identity Protection Specialized Unit at 800-908-4490 • The IRS Taxpayer Advocate can also help with unresolved issues in ID theft at www.irs.gov/advocate/ or 877-777-4778.

26. Medical Identity Theft • Medical Identity Theft – is the fastest-growing form of identity theft. As many as 500,000 Americans have been victimized by medical identity theft. Many people may not even know it. Medical ID theft takes a wide variety of forms. • Who does this sort of thing? - According to the Smart Card Alliance, three types of people commit ID theft: • Someone who is close to the victim and knows their habits and movements • Amateurs who look for unsuspecting subjects and moments and… • Professionals who work by themselves or as part of an organized group.

27. Medical Identity Theft • The scams – Illegal and bogus treatment, buying addictive drugs, obtaining free treatment … • Someone steals another person’s health data to get free medical treatment using the victim’s insurance coverage. With health care costs soaring and around 50 million people now uninsured, taking an innocent stranger’s health policy is an ever-growing threat.

28. Medical Identity Theft • The scams –A Palm Coast, FL woman named Linda Weaver was fraudulently billed for amputation of her right foot. The fraud became quite clear when she walked into the hospital on two perfectly healthy feet. • The thief’s data could end up on your permanent medical records. A California woman nearly died after being given the wrong antibiotic. Her card had been stolen and they had used the victim’s insurance card to get treatment, which became a part of her record.

29. Medical Identity Theft • The scams –A victim’s credit also can be ruined. Identity thieves typically disappear after receiving treatment on someone’s health policy. They leave unpaid hospital bills that are reported to the credit bureaus. Straightening out inaccurate credit records can take years. In the meantime, you may pay more for mortgage costs or car loans, or insurance. Your job may even be jeopardized. • An Arizona man’s records were stolen, and now his medical records show he has HIV and diabetes, even though he has neither condition. Among other things, this could easily affect his future ability to obtain health insurance.

30. Medical Identity Theft • The scams –Anndorie Sachs, received a disturbing call from a hospital that her newborn child had tested positive for drugs. Social services came to her door and nearly took her children away, thinking she was an addict. But she hadn’t given birth in years. A pregnant woman had used her stolen insurance card information to cover her own childbirth expenses. • The fastest-spreading trend involves fraud rings that are working like an assembly line operation. These rings steal lists with sensitive medical data of hundreds or even thousands of patients and mass-produce insurance claims that can steal millions of dollars in a relatively short time.

31. Medical Identity Theft • The scams - Theft rings make bogus insurance claims for medical treatment, for tests, and for unneeded medical equipment such as power wheelchairs. When the claims are smaller – they may fly under the insurer’s radar. • Police arrested 38 people in Miami-Dade last year. They had allegedly stolen medical ID numbers and billed Medicare $142 million for wheelchairs, walkers and other medical supplies. • Two Ukrainian brothers in Milpitas, CA bought a clinic, staffed it with fake doctors, and lured hundreds of seniors with free checkups and food. The suspected gang members photocopied the Medicaid and Medicare cards, and billed the health programs more than 9 million.

32. Medical Identity Theft • The scams –Sometimes the informationis received from an “inside job” at medical facilities. Sometimes fraud rings place their own operatives inside medical facilities to gain access to the records. They are often low-paid workers that can make $50 per name sold to the fraud ring. • Thieves may hack into medical databases or break into medical facilities. • A receptionist in Weston, FL was arrested for selling more than 1,000 medical IDs that later were used to bill $2.8 million in fraudulent insurance claims.

33. Medical Identity Theft • The price you pay … Ruined credit, loss of health coverage (if your coverage is maxed out), inaccurate records, legal troubles, higher health premiums … • What can you do to protect yourself? • Carefully review your explanation of benefits from your health insurer to be certain your policy is being charged only for medical treatments you received. • Ask your health provider or insurance company for a copy of your medical records and review them closely.

34. Medical Identity Theft • Check your credit reports twice a year to see if unpaid medical bills have affected your rating. If you find a problem, place a fraud alert on your report. • Avoid clinics that advertise free examsand gifts; they may want to copy and steal your health insurance info. • Protect your insurance card as carefully as your credit cards. If it’s lost or stolen, contact your health insurer immediately and get a new number.

35. Medical Identity Theft • Correct your medical records as soon as you discover inaccuracies. • But that is easier said than done. • Medical records are rapidly becoming digitized. They can easily spread all over the nation. • Tracking down where your records are housed can take years, if you’re lucky. • Federal law does not require medical providers to erase or correct inaccurate information. • You should file a police report and notify the FTC at their toll free hotline – 1-877-IDTHEFT(438-4338).

36. Medical Identity Theft • You have rights under federal law that can assist you in correcting inaccurate medical records – www.hss.gov/ocr/hipaa. Your rights include: • The right to request copies of your current medical files from each health care provider. • The right to have your medical records amended to remove inaccurate or incomplete information. • The right to an accounting of disclosures – a record of who has been given access to your medical records. This is very important in tracking down where inaccurate information may have been sent. • The right to file a complaint with the Office of Civil Rights at the federal Department of Health & Human Services if a health care provider does not comply with these rights. • In addition, many hospitals have ombudsmen or patient advocates who may be able to help you obtain medical records or provide access to information.

37. But, it’s getting better … • Fortunately, ID theft is declining after cases reported to the FTC nearly tripled from 2001 through 2004. • The number of identity fraud victims in the U.S. was 8.1 million in 2007, a 3.6% decrease from the 8.4 million in 2006, and a 9.0% decrease from 2005. • Awareness by consumers and creditors coupled with technological safeguards has helped curb cases of identity theft.

38. What does it cost you? • Time! Victims spend hours repairing damagedone by ID theft. How much depends on the severity of the crime – for example a lost credit card versus the use of your social security number to become your “evil twin.” • Money – 40% of business costs for individual cases of identity theft exceed $15,000. The Aberdeen Group has estimated that $221 billion a year is lost by businesses worldwide due to identity theft. • Victims lose an average of $1,820 to $14,340 in wages in dealing with their cases. • Victims spend an average of $851 to $1378 in expenses related to their case.

39. What does it cost you? • Practical and Emotional Costs of ID Theft. • 47% of victims have trouble getting credit or a loan as a result of ID theft. • 19% of victims have higher credit rates and 16% havehigher insurance rates because of ID theft. • 11% of victims say ID theft has a negative impact on their abilities to get jobs. • 70% of victims have trouble getting rid of (or never get rid of) negative information in their records

40. What does it cost you? • Practical and Emotional Costs of ID Theft. • 40% of victims experience stress in their family lives as a result of displaced anger and frustration over the ID theft. • 45% of victims feel denial or disbelief. • 85% of victims feel anger and rage. • 45% of victims feel defiled by the ID thief. • 42% of victims feel an inability to trust people because of the ID theft. • 60% of victims feel unprotected by the police.

41. ID Theft Issues … • Uses of Victim Information – • 66% of victims’ personal information is used to open a new credit account in their name. • 28% of victims’ personal information is used to purchase cell phone service. • 12% of victims end up having warrants issued in their name for financial crimes committed by the ID thief!

42. ID Theft Issues … • Imposter Characteristics and Relationships to Victim - • 43% of victims believe they know the person who stole their identity. • 14-25% of victims believe the imposter is someone who is in a business that holds their personally identifying information. • The most common reported perpetrator in cases where a child’s identity is stolen … is the child’s parent! • 16% of identity theft victims are also victims of domestic harassment / abuse by the same perpetrator. These victims believe that the ID theft is used as another way for the abuser to continue and demonstrate his harassment and control.

43. ID Theft Issues … • Responsiveness to Victims - • Overall, police department seem to be the most responsive to victims of ID theft, with 58% taking down a report on the victim’s first request. • 1/3 of victims have to send dispute information repeatedly to credit reporting agencies. • Only 1/5 of victims find it easy to reach someone in a credit reporting agency after receiving their credit report. • 20% of victims will have the misinformation and errors removed from their credit report after their first request for the credit reporting agency to do so.

44. WHAT CAN YOU DO? • DETER • Deter identity thieves by safeguarding your information • DETECT • Detect suspicious activity by routinely monitoring your financial • accounts and billing statements • DEFEND • Defend against identity theft as soon as you suspect a problem

45. DETER identity thieves by safeguarding your information. • Store information in secure locations • Protect your Social Security number • Protect Bank Accounts & Checkbook • Shred anything bearing sensitive information • Credit Cards

46. Deter … Protect Yourself • Store information in secure locations • Keep your personal information in a secure place at home, especially if you have roommates, employ outside help, or are having work done in your house. • Share your personal information only with those family members who have a legitimate need for it. • Keep your purse or wallet in a safe place at work; do the same with copies of administrative forms that have your sensitive personal information.

47. Deter … Protect Yourself • Store information in secure locations • Ask about information security procedures in your workplace or at businesses, doctor’s offices or other institutions that collect your personally identifying information. • Find out who has access to your personal information and verify that it is handled securely. • Ask about the disposal procedures for those records as well. • Find out if your information will be shared with anyone else. • If so, ask how your information can be kept confidential.

48. Deter – Protect Yourself • Protect your Social Security number. • Don’t carry your Social Security card in your wallet or write your SS# on a check. • 36% of Americans age 18-49 and 43% of Americans age 50 and older carry their SS card in their wallet). • Give your SS# only when absolutely necessary, and ask to use other types of identifiers. • If a company uses your SS for an identification number, you can request it use a different number.

49. Deter – Protect Yourself • Protect your Social Security number. • Your employer and financial institutions will need your Social Security number for wage and tax reporting purposes. Other businesses may ask you for your SS number to do a credit check if you are applying for insurance, a loan, renting an apartment or signing up for utilities. • Some businesses may want your SS number for general record keeping. If someone asks for your SS number, ask: • Why do you need my SS number? • How will my SS number be used? • How do you protect my SS number from being stolen? • What will happen if I don’t give you my SS number?

50. Deter – Protect Yourself • 2/26/09 – a Supreme Court gave a hearing to using ID theft laws against illegal workers who used fake ID cards. • Because there are about 1 billion combinations to any nine digit number (like those used for SS) … and of those, about 400 million have been used- • When an illegal immigrant, Flores-Figueroa was found using a fake ID card, he was found not guilty and did not have to serve the 2-year jail penalty. The penalty is for “knowingly transfer, possess or use … a means of identification of another person” …and he argued that he “didn’t know he actually had the ID of another person”! • If you have specific information of Social Security number misuse that involves the buying or selling of SS cards, may be related to terrorist activity, or is designed to obtain SS benefits, contact the Social Security Administration (SSA) Office of the Inspector General – www.socialsecurity.gov/oig or 800-269-0271 ... or write: SSA Fraud Hotline, P.O. Box 17768, Baltimore, MD 21235.