The Business of Identity Theft by Tim Knox
Q: I use PayPal to accept credit cards for my online collectibles business. I
recently received an email that my PayPal account was going to expire in five
days if I didn't click a link in the email and give them my PayPal account
information. Being naturally paranoid I decided not to give this information
and I'm happy to say that my PayPal account did not expire. Was this a scam? --
Brenda A.
A: Be thankful that your paranoia kicked in, Brenda, because you were about to
fall victim to the scam of the week, this one aimed at the 35 million merchants
and individuals who use Paypal.com as their online payment processor.
The email you received was not from PayPal, but from an Internet bad guy behind
a forged email address using the PayPal.com domain. You should understand that
no reputable online company will ever ask you to provide your account
information. Think about it. They already have this information. Why would they
ask you to provide it.
Since I use PayPal for several of my online ventures, I, too, received the
email in question. The email first seeks to instill fear in you by saying that
your PayPal account will be closed if you do not provide personal information.
You are then directed to open an attached executable file and enter your PayPal
account information and other personal information that PayPal doesn't even
require, including your social security number, checking and savings account
information, driver's license number, and other personal information that can
be used to clean out your PayPal account and perhaps even steal your identity.
If you're not familiar with PayPal, it is a hugely successful, web-based
company (purchased by eBay in 2002) that many online retailers and eBay sellers
use to accept electronic payments for everything from newsletter subscriptions
to consulting services to just about any product for sale on eBay.
The allure of PayPal is that it does not require the seller to have a bank
merchant account through which to process credit cards. Anyone with a
verifiable email address and bank account can use PayPal and the service can be
implemented almost immediately after registering.
When someone places an order on a website that uses PayPal for online payments,
that customer is directed to PayPal.com to complete the payment process using a
credit card or electronic check. The merchant can transfer the money collected
in his PayPal account to his checking account any time he likes. Since many
larger merchants make this transfer just once a week or so, their PayPal
accounts are ripe for the picking from those who have the cunning and lack of
ethics required to gain access.
The shear number of PayPal customers is one reason it has become a popular
target of scam artists trying to steal personal information from individuals
and businesses alike.
Identify theft is on the rise. Thanks to the Internet stealing someone's
identity has never been easier. At any given moment, there are any number of
Internet thieves using all manner of high tech wizardry to steal personal and
business information from unsuspecting souls, and many times they can gain
access to this information simply by asking the person to provide it through
fraudulent means.
The PayPal scam is just the latest in a long line of sophisticated attempts to
steal personal information through online means, Amazon, eBay, Dell Computer,
and many others have been the brunt of many such scams in recent years.
Identity theft is what's known as a knowledge crime, which means that the
criminal doesn't have to break into your house to rob you blind. If you have a
bank account and a social security number, you are susceptible to identity
theft.
While most people are familiar with identity theft, most business men and women
never think about it happening to them, at least on a professional level.
Consider this: if a criminal can learn your business checking account number or
the number of your company credit card, they can steal far more from your
business than if they had simply knocked down the door and carted off your
desk.
The Internet aside, most business and personal identity theft is still the
result of stolen wallets and dumpster diving. You should guard your business
records closely and be very careful what you throw away. Stop and think for a
moment what a criminal might find in the dumpster behind your office.
There's a good chance that dumpster has, at various times, contained scraps of
paper with your social security number, driver's license number, credit card
number, old ATM cards, telephone calling cards, and other pieces of vital
business information like bank statements, invoices, and purchase orders. A
dumpster-diving thief could literally rob your business blind in a matter of
hours.
Here are a few ways to protect yourself from business and personal identity
theft.
* Never give out your first name, last name, business name, email address,
account passwords, credit card numbers, bank account information, PIN number,
social security number, or driver's license number.
* Change your online account passwords every 30 days. Believe it or not, a
hacker who steals your personal information can guess your online account
passwords in about two minutes. If your Charles Schwab online account password
is your birthday or the name of your first born or family pet, count on a
hacker cracking that code faster than you can say 'Bill Gates.'
* Never provide personal information in response to an email or telephone call.
Just because someone calls and says they are from Dunn & Bradstreet and
need to confirm your business information does not mean they are really from
Dunn & Bradstreet.
* Never give your business credit card number over the phone to place an order
with someone who has called you unsolicited. If you are interested in what they
are selling get their number, check out their company, then call them back to
place the order.
If you think that you have become the victim of identity theft or think someone
is trying to steal your identity or personal information you should report them
immediately to the Federal Trade Commission. You will find more information on
their website at http://www.consumer.gov/idtheft/.
For more information on what to do if identity theft happens to you visit
http://www.privacyrights.org/fs/fs17a.htm
.
So, if you ever receive an email from PayPal, Amazon, eBay, or any other
ecommerce website asking you to update your account information by email you
can pretty much bet the farm that it is a scam.
In business, as in life, a little paranoia is a good thing.
About the Author
Tim is written by veteran entrepreneur and syndicated columnist, Tim Knox. Tim
Knox is the founder of DropshipWholesale.net, an online
organization dedicated to the success of online and eBay
entrepreneurs. Related Links: http://www.prosperityandprofits.com
http://www.smallbusinessqa.com
http://www.dropshipwholesale.net
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