Why is Target getting hacked such a big deal?

Dog nag-it; Hackers got my credit card info….again!  With all the talk of Target and a few other retailers who have been victims of recent hack attacks, I thought it might be a good idea to revisit a few items, including why we, as consumers should care, credit card usage, and finally what can be done to safeguard our identities.

Once a hacker has your information, they can use that information to make credit cards, or they can steal your username and password to gain access to your email and other online sights.  With access to your other online sights, they may be able to dig up your Social Security Number (SSN), and that is the holy grail for the hackers. Once a hacker has your SSN, they can obtain credit cards and loans in your name.  Really making a mess of your life.  We all know that the credit reporting agencies are less than cooperative; so it really makes for a bad few days, weeks, months or possibly even years to clean this mess up.

Now, I’m the last one that has any right to tell you how to spend your money.  By credit card usage, I’m referring to how you handle credit card purchases.  First I’d tell you to “Be careful out there.”  A friend of mine, who I chastise on a daily basis for the pure enjoyment doesn’t use his credit card on small purchases (say $50 bucks, but who really knows, I don’t).  I on the other hand tend, I never carry cash, so I use mine all the time.  Now that I’m thinking about it, he may have the right idea; and I’m sure we’ll talk more about this at work. Second, when a cashier asks for your zip code, say “no.” There is no requirement for you to reveal your zip code, unless it is required to complete the transaction (think gas stations). What value is in your zip code?  Armed with your zip code and name from your credit card.  Retailers can use that information coupled with other information gathered from commercial databases to retrieve lots of information about you, including your mailing address.  Ever wondered how they got your address for that coupon mailer, or how they got your email address?  Retailers may sell your information to other marketers.

So now that we know there really is a conspiracy theory, and the world is out to get us, how do we protect ourselves?

• If you have shopped at Target, and suspect unauthorized activity on your credit card, call Target’s hotline (866) 852-8680.  You may also want to consider a fraud alert or a credit freeze.  A good explanation of the differences is found at Kiplingers and Equifax.
  • A fraud alert may be initiated for 90 days, and renewed at 90 day intervals. A fraud alert implements additional precautions to verify your identity before granting credit. There is no cost to initiate a fraud alert.  Only one agency needs to be contacted, they will contact the other two bureaus for you.
  • A credit freeze makes it extremely difficult to have credit granted to you.  Read these explanations of credit freeze from Experian, TransUnion,  Equifax, and Clark Howard.  A credit freeze needs to be initiated at each of the three credit bureaus and there is a cost to place and remove them.
• Check your statements.  A common tactic of criminals is to charge a small amount to a credit card to test it, then once that passes, they’ll charge more.  A friend of mine uses a minimum dollar amount for credit cards, so anything below his set threshold will stand out on the statement, a pretty smart idea if you ask me (but I’ll never tell him that).
• Change your PIN number and passwords on a regular basis.
• Use PayPal instead of credit cards whenever you can.  They have built in protections and you can limit your exposure, especially if you have it set up in an isolated account.
• DO NOT click on that link in the email from Nigeria!!  I’m willing to bet my co-worker’s paycheck that you didn’t win the Nigerian National lottery.

Is it the end of the world, no.  Any fraudulent charges will more than likely be taken care of by the credit card company, your financial institution or Target.  The biggest risk, in my opinion, is not my credit card being charged, but someone could take over my identity, and leave me on the hook for it.

My cat is calling…time for a cup of coffee.