Aussies still getting sucked in by scammers

Scary fiction is fun, but the worrying truth is that identity theft is a fact – and too many Australians fall victim to it. Find out how to keep the scammers and thieves at bay with these simple self-protection strategies.

 




 

Fact: Losses from cyber crime and scams reported to the ACCC totalled $63 million in 2010.

Fact: Scams reported to the ACCC more than doubled from 2009 to 2010.

Fact: 1.5 million Australians had their credit card skimmed, and 1.2 million had their bank account illegally accessed in 2009.

Fact: Scams initiated by unsolicited telephone calls increased almost 700 per cent, jumping from 2,036 reported events in 2009, to 14,144 in 2010.


Here’s a scary story. A teenage girl has taken a babysitting job and is all alone in the house with two young children. All seems normal, right? But then the phone calls start. There’s a guy on the other end, making threats – she hangs up, but he just keeps ringing back. Eventually the girl gets scared enough to call the police and they promise to find the source of the prank calls. But when they get back to her, they’ve got some terrifying news: the calls are coming from inside the house.

Okay, so this probably never actually happened, but like all urban legends, it teaches us an important lesson: you don’t always know who’s contacting you … or where they’re from or what their intentions are. You probably don’t have to worry too much about calls coming from inside your house, but as the facts show, when it comes to your personal information and your money, there really are scammers out there who are out to get you.

With National Consumer Fraud Awareness Week just behind us, now’s a great time to look at how to protect yourself from identity theft – but more importantly, you need to start taking action! Last year Veda Advantage revealed that 70 per cent of us have yet to put basic protective measures in place to guard against identity crime, and as scary as the ACCC numbers are, the true story of identity theft, fraud and consumer scams is probably a lot scarier – it’s likely that there are many people out there who don’t want to admit they’ve been fooled, and the ACCC is just one of several agencies who receives reports about cyber crimes and scams. Who knows how many more victims there are out there?

So how can you protect yourself from cyber crime and stop your name being added to the list of victims? These basic steps are a great place to start:

Monitor and protect
Monitor your accounts and take action quickly if you see any suspicious activity, even if it seems minor. You’re also entitled to see your credit reference file – you can check it for free if you have it posted to you, or you can access it online for a small fee  – so get hold of it and check it thoroughly for errors. Credit report agency Veda Advantage also offers an alert service that will allow you to keep track of any changes to your file as they happen, which will allow you to challenge anything that seems wrong straightaway, and the fee is a small price to pay to know whether someone’s stolen enough of your identity to pretend they’re you and apply for credit in your name.

Know who you’re talking to
Don’t provide personal details over the phone unless you were the one who initiated the call. If you receive an unsolicited call from a company you do business with, request the caller’s details and call the organisation back, but not using the phone number they give you – you could just be calling a scammer back. And don’t follow links you receive in emails, even if you recognise the sender. Some ‘phishing’ scams can be quite sophisticated, so if you receive a warning or special offer, always go directly to the company’s website to verify it. One of our staff received an email like this just the other day – the ‘sender’ was boasting about the great deal they’d gotten on a new iPhone, and all she’d need to do to get the same deal was follow the link. What the scammer didn’t know was that the email address they’d stolen to send the emails from belonged to a child who would never have sent an email like that. Our staffer got away from this scam unscathed, as did the kid whose email had been hijacked, but it just goes to show how easy it could be to get taken in – who knows what that link could have unleashed on her computer if she’d been tempted to click through?


Stop sharing
Personal information is the key to identity theft and one of the biggest weapons scammers have: it helps them to access everything they need to take you for a ride. Don’t post personal information on online networking sites, and if you already have, at least ensure that you’re using the maximum privacy settings that the site offers. If companies, both online and off, ask you to provide any personal information when making a purchase always make sure you ask why they want it. There are some circumstances, such as when you’re opening a bank account, where you’re legally required to part with your info, but often companies just want to build a customer database. And the more of your personal details that are out there, the more at risk you are.

You really can’t always know who’s calling … or emailing … or lurking … but if you keep an eye on your money, a tight grip on your personal information, and report any identity theft as soon as you know it’s happened, you’ll be able to limit both the risk of getting caught out and the damage criminals can cause.

Is Gen Y the Debt Generation

It doesn't matter what generation you belong to, having more debt that you can cope with isn't fun! So whether you're an X, Y or even a Boomer, we have some great tips for taming the credit beast and getting off the debt treadmill!

Gen Y - they've got it all. They're the generation of social networking, Harry Potter, and the iPod. They’re technologically savvy, open-minded and focused on creating a healthy work/life balance. They managed to avoid the fashion disasters of the 70s, faced down the dreaded Millennium Bug and they've got their whole future ahead of them. But unfortunately, Gen Y has something else that's a whole lot less encouraging - an enormous amount of debt ...

They’re not alone: Australia’s love affair with credit is stronger than ever. The latest figures from the Reserve Bank reveal that our collective credit card bill from December 2010 broke through the $49 billion mark, and our average household debt has reached 2.5 times our annual household income.

Clearly, debt is common, but it seems young Aussies in particular really need some great debt management advice to learn how to cope with it
 
Veda Advantage 2009 data indicates that Generation Y are responsible for 37 per cent of Australia’s total consumer credit defaults, despite only comprising 20 per cent of the ‘credit active’ population, with a higher rate of telecommunication and personal loan defaults than any other generation. According to ITSA, 15 to 29 year olds accounted for 18 per cent of people applying for bankruptcy and 37 per cent of people entering debt agreements in 2009. Failure to manage debt on this scale can have serious ramifications – and bankruptcy isn’t the ‘easy’ out many people think it is. Bankruptcy limits what a person can own, where they can work and where they can go for years at a time – and the notation stays on your personal credit reference for seven years. If you’re a young person, this is the last thing you need hanging over your head – but many members of Gen Y just don’t seem to have learnt how to avoid it.
 
The late teenage years are a critical time financially – it’s a time when young people start to bring in steady incomes and take on big financial responsibilities. But it’s also a time that’s littered with ‘debt traps’. If you want to avoid getting stuck, try these simple tips for avoiding some of the most common financial pitfalls:

Go pre-paid
Mobile phone debt is sneaky. Post-paid plans can come with ‘included call’ amounts that can seem impossible to exceed, but these days phones do far more than just make calls – with texting, internet capability and endless options in downloads and added extras, it’s all too easy to eat up your included call quota. And with 83 per cent of teens owning a mobile, that’s a lot of young people at risk. Taking the pre-paid option puts a limit on what you can spend – but remember that just ‘topping up’ your phone every time the money runs out isn’t really a cheaper option. You need to commit to making the credit last for a certain period of time to make the best saving possible.

Think debit not credit
These days it can seem hard to get by without a credit card. Online shopping generally requires you to have one, and everyone’s keen for the simple convenience of just swiping a card to pay. Unfortunately, the combination of high interest rates and easy access to money can cause big problems – 37 per cent of those who entered into debt agreements in 2009 said that excessive use of credit was the cause of their financial woes. That’s where debit cards can be your ‘knight in shining armour’ – debit cards give you all the convenience of credit cards, and access to your favourite online shopping sites, but because you’re only spending your own money, it’s almost impossible to rack up huge amounts of debt.
 
Don’t borrow trouble
Once you turn 18, you’re old enough to sign a financial contract. But before you do, it’s vitally important that you understand all your rights and responsibilities. Whether you’re getting your first credit card, taking on a personal loan, or considering guaranteeing a loan for someone else, read the fine print thoroughly and think carefully about whether you have the resources and discipline to manage the debt. Once you sign on the dotted line, you’re liable – so be absolutely certain you know what you’re doing, and you can afford to repay any loans, before you whip that pen out.

These days it doesn’t matter what generation you belong to – budgeting, money management, avoiding financial traps and taking control of your money is more important than ever. If you can do that (and if the 2012 disaster theories fizzle out like Y2K did!), you’ll be able to create the financial future you really want!