People who want to protect their credit scores need to keep up with signs of identity theft and other criminal activity while also making their monthly payments and avoiding the temptation to charge too much on their credit cards.
Identity thieves can be particularly active at tax filing time, which is why Florida Attorney General Bill McCollum recently marked Consumer Protection Week by advising consumers on ways to reduce their chances of falling victim to financial fraud.
McCollum noted that some consumers can find themselves victimized by fraudulent tax preparers who lack proper training and who mislead people about their training and other aspects of their background.
He also advised people to check the credentials of a tax preparer before doing business with them, and to find out if they belong to a state board or bar association that requires them to receive continuing education. It's worth asking if preparers are audited as well, while remembering that only attorneys, certified public accounts and enrolled agents are allowed to represent taxpayers before the IRS.
However, consumers have more than just unscrupulous agents to worry about at tax time. They need to remember to keep their financial documents in a secure place at home, since burglars have been known to take personal data as well as belongings these days. They also need to be aware of their mail to ensure that things like W-2 forms have not been stolen.
Among other related issues, McCollum advised people to be on guard against phishing scams, where phony emails claiming to be from the IRS are sent to people requesting their financial data, such as account numbers or Social Security numbers. The IRS has announced to taxpayers on more than one occasion that it never initiates contact with taxpayers by email. Simply opening these emails can also give hackers and other criminals an opportunity to download malware onto one's computer, resulting in stolen passwords and credit card numbers.
Another warning sign at tax time is fraudulent charities claiming that donations made to them are deductible. In such cases, a good place to start is by checking an organization's federal tax identification number.
By keeping their personal information secure and reacting quickly to suspicious activity, people will be better equipped to thwart identity thieves and keep their credit reports from being damaged by phony accounts and false charging activity.