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The Worst Part About Being Robbed By Donna Freedman
A stolen wallet means you're subject to multiple threats, particularly credit card and identity theft. But taking the right steps and precautions can prevent or minimize your losses.
I got mugged on the way to a conference in Chicago late last month. By the time I got my credit card company on the phone, the thieving punks had already bought themselves sandwiches.
The incident left me slightly sore and fairly rattled. But the worst part wasn't the loss of the cash or my peace of mind.
It was the paperwork and the fear of identity theft.
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Even though I'd made a few smart choices (more on that later), my stolen wallet held some potential time bombs:
A deposit slip (why was I carrying it?).
A department-store credit card I rarely use (ditto).
My driver's license.
Debit and credit cards.
A check from my brand-new business account (to pay my half of a shared hotel room).
I hope this never happens to you. But you should prepare for it right now, while you have the opportunity to cut potential losses. Learn from my mistakes -- and from what I did right.
Time is of the essence
If you're robbed, call the police first. But then call your bank and/or credit card company. Don't wait until the next morning or the next business day. These companies have 24-hour emergency lines. Use them.
I immediately froze my personal and business accounts, and canceled the debit cards. Because of the deposit slip, business check and driver's license in my wallet, the thieves could have ripped me off again -- e.g., by printing fake checks -- so I closed the accounts upon returning to Seattle.
I still write paper checks from time to time. For example, my landlords aren't set up for electronic payments. I'd just ordered a new batch, which I shredded. What a waste.
After opening new accounts, I had to re-establish the transactions linked to them: PayPal, monthly contributions to church and charity, automated savings at an online bank and payments for health and life insurance.
Protect your identity while traveling
A lot of this trouble could have been avoided if the deposit slip and check hadn't been in my wallet. If any item in your bag or briefcase bears a bank account number, take it out.
Stay alert to fraud
As noted, the crooks used my credit card immediately. They didn't have to sign for the transaction because they spent less than $25. That policy really frosts me.
It could have been a lot worse. Julie W.'s wallet went missing last year while she had breakfast with a friend. She doesn't know whether it was stolen outright or whether it fell out of her purse. What she does know is that she didn't spend $2,000 that morning.
"They beelined up to Target and were able to use two different cards," says Julie, a Southern California resident. One was a debit card, but the crook specified "credit" at the checkout and thus didn't need a PIN.
She's spent about 15 hours dealing with paperwork and monitoring accounts. Fortunately, no attempts at identity theft have been detected.
A good place to start is a fraud alert placed with one of the three credit bureaus, which will then notify the two other. This requires potential creditors to take "reasonable" steps to verify identity before issuing credit. Placing the alert is free and can be renewed every 90 days.
You can sign up with a credit-monitoring service, but make sure you're not paying just for stuff you can get for free. The Federal Trade Commission has a couple of useful pages: "Detect Identity Theft" and "Recover From Identity Theft."
What's in your wallet?
Try this: Write down everything that's in your purse, briefcase or billfold. No peeking. Now open it and see if you remembered everything.
For extra credit: How much of that stuff do you use on a daily or even weekly basis?
It could be time for "a wallet audit," according to Denis G. Kelly, the author of "The Official Identity Theft Prevention Handbook." Weed out what you don't need, and make a list of the rest, so in the event of loss you'll know which calls to make.
Write down only the 800 number for each card you carry -- not the card number itself. The customer-service rep can look you up based on security questions.
Keep the list anywhere but your wallet -- stored on your phone or laptop, e-mailed to yourself, with a friend or relative.
The weeding out is as important as the list making. There's no reason for me to have carried that department-store card, since I use it once a year, tops. My wallet also held a gift card to a Seattle restaurant, which obviously couldn't have been used in Chicago.
"Carry only what you need," Kelly says.
Two weeks after the fact, I'm remembering other wallet plumpers, such as my library card, punch cards for a bakery outlet store and my favorite teriyaki place, a Miraculous Medal given to me by an old friend, a picture drawn by my great-nephew and my membership card from American Mensa. That last one was feeling less appropriate by the minute anyway.
Careful what you carry
What shouldn't ever be in your wallet? Anything with sensitive information, such as a birth certificate or Social Security card -- it's manna from heaven for an identity thief. Both of these things were in Florida resident Kelly D.'s purse when she set it down at a favorite tavern and turned to chat with a friend.
"Which in hindsight, I guess, is pretty stupid," says Kelly, who asked that her full name not be used.
She'd put the two items in her bag for safekeeping during a recent move and then forgot to take them out. Kelly lost cash and credit cards, too -- and to add insult to injury, the crook used her smartphone to post profane messages to her Facebook page.
"There's a whole lot of jerks out there," says Kelly, whose new phone is password-protected.
Senior citizens are vulnerable because Social Security numbers are incorporated into Medicare ID numbers. Here's one way around that: Photocopy the card and cover the last four digits with a black marker. Carry this with you day to day, taking your real card only when you have a doctor's appointment.
A regular health insurance card leaves you vulnerable, too. It's really just "a credit card with a million-dollar credit line," according to Rebecca Busch, the author of "Healthcare Fraud: Auditing and Detection Guide."
Medical identity theft has serious implications. If the thief's health records get mixed up with yours, you might find it harder to get health or life insurance. For example, "your" medical records might show you as being HIV-positive.
Busch's favorite cautionary tale is of a woman whose insurance card was stolen by a pregnant addict. The state tried to take custody of the woman's children because they thought she'd just given birth while addicted to methamphetamine. Worse, the woman needed surgery the next month and was nearly transfused with the addict's blood type rather than her own.
The author suggests asking insurance providers for a new ID number (which may not be possible) and scrutinizing every explanation of benefits statement that comes your way, to be sure no one is having dental work done on your dime.
A couple of hours after the mugging, I was on a plane to Chicago. I got through airport security with a second form of picture ID: my passport. I've carried it on travels for years, in case I lost my wallet.
It is possible to get on a plane without a picture ID, according to the Transportation Safety Administration's website. But this generally requires "additional screening," so I'm glad I didn't have to go that route. I've had the special pat-down, and it's pretty startling.
Two other things that made travel possible: the cash and credit cards stored elsewhere on my person. I keep most of my money and credit cards in coat or jeans pockets and in a small fanny pack under a sweater. My theory: Thieves are in a hurry, so finding some money and at least one card in the wallet might be enough.
Security specialist John Rendeiro also uses financial decoys. On a recent trip to Spain he put some money and one card in a pocket wallet but kept his ID and the bulk of his cash and cards in a waistband wallet under his shirt.
And back home? Rendeiro recommends carrying just one credit card and "minimal" cash, even if you're only heading out to lunch.
"You just want to minimize the (potential) damage," says Rendeiro, who's with the medical and security firm International SOS.
In store checkout lines I've glimpsed wallets that look like museums of credit: six or seven cards, each displayed in a little plastic sleeve. That's not a good idea, says Richard Barrington of MoneyRates.com.
"Every one of those things is like a window. If (theft) happens, those windows become places where the criminal can come into your house," Barrington says.
Close the windows, already. Choose one or two cards and lock up the rest.
Pickpockets and thieves have been with us since cities were invented. If you've never been robbed, you're either very lucky, very vigilant or very unapproachable. Or maybe you live in North Dakota.
We can't be guaranteed safe passage through life. What we can do is take reasonable precautions. Someone once laughed at me for carrying a passport when flying to my home state of New Jersey, which is technically not a different country.
Now I'm glad I did. It's awkward enough to take off your shoes and belt at airport security. The last thing I needed was a special pat-down while suffering from the shock and adrenaline hangover of having been robbed an hour earlier.
I hope that thieves never find you. But if they do, I hope you get the kind of belly laugh I got later. The bank customer-service rep told me one of those three knuckleheads wrote a check on my business account and deposited it in his bank account. Honest.
He made it out for $8,000 and wrote "for serivces (sic) rendered" in the memo line. How on earth did he come up with that amount? Because $7,000 seemed penny-ante but $9,000 might have looked suspicious?
The banker couldn't say whether the guy would be prosecuted, although I expect the police might want a look at him in connection with similar robberies. Myself, I'd be tempted to visit him in jail and offer to teach him how to spell.
Donna Freedman is a freelance writer in Seattle. You can find more of her writing on MSN Money's Frugal Cool blog and at Surviving and Thriving (motto: "Life is short. But it's also wide.").
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