The Internet and wireless technology have made it easier than ever for investors to review brokerage account information and initiate investment transactions on the go. At the same time, investors need to take certain precautions to help ensure the security of their brokerage accounts and prevent those accounts from becoming fodder for ID thieves.
Cases involving identity theft of brokerage accounts have become more frequent in recent years. In some instances, the person responsible for the theft is a close family member or friend of the victim – an ex-husband, trusted relatives, or caregiver. Sometimes the perpetrator is a complete stranger who has been able to hack into the victim’s computer and steal that person’s brokerage ID and password information.
By following a few simple steps, investors can make it much harder for unauthorized people to gain access to their brokerage accounts, says the Financial Industry Regulatory Authority (FINRA).
Read Your Account Statements. Don’t toss aside your monthly account statements. Read them thoroughly as soon as they arrive to make sure that the transactions shown are ones that you actually made, and check to see whether all of the transactions that you thought you made appear as well. Be sure that your brokerage firm has current contact information for you, including your mailing address and email address.
Lock the Door Behind You. It is very important to terminate each online session when you are finished – usually by clicking the “Log out” link on the site. This is the computer equivalent to locking the door when you leave the house. If you merely type in another address, or close or minimize the Web browser window, it may be possible for unauthorized users with access to the same computer to gain access to your account information. Retrieving this information could be as easy as clicking on the Internet browser icon, pressing the browser’s Back button, or calling up a browser’s Internet History.
Guard the Front Door. Recently, popular browsers such as Microsoft Internet Explorer and Mozilla Firefox have introduced a feature where the browser offers to “remember” your usernames and passwords to secure web sites. Think twice about using this feature as it may allow others who can access your computer to log in to your brokerage or other online account. Never allow the browser to remember user names and passwords when using a public, shared computer.
Contact Your Brokerage Firm. If you think that your personal information has been stolen and that your brokerage account has been hacked, notify the firm where you have the account immediately.
Securities Scams. Before you do business with any investment-related firm or individual, do your own independent research to check out their background and confirm whether they are legitimate. For step-by-step tips and links to helpful Web sites, read Check Out Brokers and Advisers from the Securities and Exchange Commission (SEC).
Do a Periodic ‘ID Theft’ Credit Report Check. It is a good idea to check your credit report at least once a year since it may signal problems ranging from unauthorized transactions to identity theft. You can obtain a free annual credit report from each of the three major credit bureaus – Equifax, Experian, and Trans Union – online at www.annualcreditreport.com.