Study: Canadians falling prey to phishing schemes

Canadian consumers are becoming more vigilant about the risk of identity theft, including online schemes, but a study released Wednesday showed they are not doing enough to protect themselves.

“”Most Canadian consumers are not aware of how frequently their personal information is accessed

legitimately and possibly illegitimately by others despite their best efforts to maintain control of it,”” said Amy Gergely, senior manager of external relations for Intersections Inc. of Chantilly, Va., a provider of identity theft protection and credit management services.

According to the study, conducted by Ipsos-Reid, 75 per cent of Canadians are concerned about identity theft but only 20 per cent consider themselves “”very well informed”” about how to protect themselves against an organized crime experts say is moving quickly across the country.

In one encouraging sign of Canadians’ awareness of identity theft, only 14 per cent said they would divulge personal account information if a retailer they frequently deal with contacted them by phone or e-mail.

Intersections explained this finding indicates Canadian consumers are tuning in to identity theft strategies like phishing, in which fake Web sites of banks and other companies encourage customers to give personal information.

Last month, RBC had to deal with an e-mail phishing scheme that went out to many RBC customers urging them to enter their client card number in order to access their accounts. Because this came on the heels of a well-publicized IT fiasco in which millions of Canadians accounts reflected incorrect balances, it increased the risk some customers might respond.

“”When it comes to asking (for) personal information, No. 1, most companies don’t do that,”” said Det. Staff Sgt. Barry Elliott of the Ontario Provincial Police in North Bay, Ont., and founder of PhoneBusters, a clearinghouse for Canadian fraud statistics. “”They’ve already got your information, so why would they ask for it?””

He said consumers should also be careful about using hotlinks that supposedly connect to the Web site of a company asking for personal information. “”On hotlinks, you don’t know where you’re going. You could be on a Web site in Russia.””

Statistics from PhoneBusters showed more than 13,000 Canadian victims of identity theft last year lost more than $21 million. This is an increase from 2002, in which more than 8,000 people reported losses of more than $11 million.

Elliott said it’s difficult to pinpoint whether the money was lost through a telephone, e-mail or other scam.

The poll also showed in an effort to prevent becoming a victim of the crime, only a minority of respondents keep personal documents or records locked up (16 per cent), ensure credit cards and debit cards are being handled by sales personnel in plain view (13 per cent) and shred personal documents or records (12 per cent). Only two per cent said they review their credit bureau files or credit records.

The harsh reality, however, is consumers have no protection against someone stealing their identity because it’s housed in numerous businesses, including “”the video store around the corner where you live,”” explained Elliott. Yet “”you can protect yourself from that name being any value to the criminal.””

He said this can be done by checking credit ratings with Canadian credit bureaus such as Equifax Canada and TransUnion Canada. Although consumers can gain access to their report once a year at no cost, Elliott suggested monitoring it more frequently for unauthorized credit card applications or other suspicious financial activities and frequently reviewing credit card and chequing accounts online.

The study by Intersections also recommended that businesses play their part in securing data or risk losing their customers to others that do a better job. Elliott said the biggest problem around identity theft for businesses is computer hackers breaking into company systems or more commonly “”dirty”” employees selling private lists.

Businesses that are proactive about keeping personal data safe will have a healthier bottom line, Gergely said, quoting U.S. startup, ID Analytics Inc., which analyzes credit applications and said up to 70 per cent of losses written off as bad debt may be fraud.

Elliot said keeping information safe includes encrypting data, monitoring hacking and installing a good firewall, as well as implementing a plan to deal with the theft of customer information that includes immediately notifying consumers and credit bureaus.

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