Tips

Financial fraud is rampant around the world, but citizens of the U.S. have arguably experienced more than their fair share due to our reputation as a wealthy country. Simply by being a U.S. resident, your odds of being targeted for financial fraud may be higher than if you lived in a second or third world country. And, while technology has added much to our lives, it’s also opened doors to hackers and other nefarious criminals whose sole mission is to come up with devious plans to part you from your money. The sad thing is that these criminals care little about how their activities negatively impact their victims. Elderly people who have labored their entire lives have been just as likely to be victims of financial fraud as persons with large amounts of disposable income. Pay attention to these warnings if you want to protect yourself and your loved ones from financial fraud.

Keep Junk Mail in Its Place

Whitelist people and companies that you do business with or that you’re interested in hearing from. Anyone else should be automatically sent to your junk mail, where it won’t waste your time or tempt you into clicking on strange links. Any email client that you use should be capable of making rules about which emails go to your inbox and which go to a junk folder.

Don’t Click on Links

Lesson number two is just don’t click on links in emails that you receive unless you’re positive they are from a trusted source. A common method that hackers use is to send you a seemingly innocuous link, which embeds a malicious file on your computer. All the time you think you’re just reading information or entering a contest, the program is setting itself up to read your keystrokes. 

Know About Keystroke Programs

Keystroke programs are malicious code that send information about what you type to hackers. For instance, let’s say you click on a link in an email that you received from a stranger (despite our warning not to). Your computer gets infected with a keystroke program. After you’ve entered the contest, or read some clickbait article about how to make $300 a month scot-free, you decide to check your bank balance to make sure a deposit was put in there. Now the keystroke program is working, so your bank username and password, as well as the website you’re visiting (your bank’s website) is being sent to Eastern Europe or wherever the hacker resides. You log off your computer and go about your business for the rest of the day. Meanwhile, your hacker drains your bank account using your own “personal information” they obtained by tracking your keystrokes. 

Don’t Engage With Telephone Solicitors

Telephone hackers aren’t always obvious, so it makes good sense to just make a policy of not engaging. A telephone caller who is trying to get your financial details doesn’t just outright ask for your social security number. They’re playing the long game. They may get you to trust them by telling you not to give them any financial information. They might say, “I need your social security number but you know, there are people out there that can’t be trusted. So call me back at this number and then we can talk.” Of course, it doesn’t matter if you call them back or if they called you. They’re still a stranger, and you didn’t initiate the call. Don’t give your details to anyone who you did not call first, including supposed debt collectors, IRS representatives or Social Security representatives. Just hang up. 

Don’t Access Financials in Public

Lots of people bring their laptop to public places like airports, airplanes, coffee shops, restaurants and even park benches. That’s fine; it’s great to get work done in pleasant surroundings or when you have nothing to do but wait until you arrive at your destination. But you should never access financial websites while using a public Wifi setup. Don’t check your Bitcoin balance, your bank balance or your kid’s college account at Starbucks. Resist the temptation. Only do these kinds of things at home. Also, if you’re on vacation in a hotel or Airbnb, use a VPN, which is a Virtual Private Network. This systems masks your location but it also keeps prying eyes from hijacking into your Wifi and stealing financial information. 

Consider an RFID-Blocking Wallet

Your grandparents (and parents!) never had to deal with electronic pickpocketing, but you do. Electronic pickpocketing is where a passerby skims information from the cards inside your wallet and performs other hijinks to make fraudulent charges that you could be responsible for. Amazingly, they can do this simply by standing near you as you wait to cross a street or make a purchase at a checkout counter. RFID wallets block the signal so that no one can steal from you in this way. 

Avoid Skimmers

Credit card skimmers are everywhere. Whether you vacation in Mexico or visit your local gas station, you’re at risk of having your credit card information “skimmed.” Card skimmers are hard to identify. They look identical to the regular card slots where you slide your card into an ATM to get money or pay for gas. Later on, when no one’s watching, the perpetrator comes by to get their skimmer and replace the legitimate card slot device. Then they use the skimmer to download people’s credit card information to make fraudulent purchases. Meanwhile, you’re inconvenienced, have to get a replacement card mailed to you and might even get overdrawn, depending on the amount of the fake charges. Avoid skimmers by only withdrawing money at ATMs inside of bank lobbies or inside of stores with high security and lots of traffic. Thieves need isolation to put these skimmers in place, so you can reduce your odds by using only ATMS in highly secured areas. 

Unfortunately, the threat of financial fraud is higher than ever before. The risk comes from all corners of the world, too. Use these tips to safeguard your financials. But if you do become a victim of financial fraud, know that you have resources. Your CPA may be able to help you to recoup your good name and your stolen money.

Webinars are more popular than ever, thanks to restrictions on in-person social gatherings. You may be planning on hosting a webinar for your own business or as an employee. Whatever the reason for your business webinar, there are some things you can do to ensure that it’s a success. Success would mean that you looked professional while hosting the webinar, that the webinar itself went off without a hitch and that others found the content useful. Here’s how to make that happen.

Do a Dry Run

If this is your first business webinar, do a dry run of the entire webinar, using a friend, spouse or colleague as the remote participant. Do the dry run from start to finish, including the initial invitation, asking and answering live questions and signing off. A lot of things can go wrong, from poor sound quality to a malfunctioning webinar hosting platform, to just losing your own focus or getting nervous. A dry run ensures that you work out the kinks in private before presenting yourself in public. Also, if the webinar platform turns out to be buggy, you’ll have time to choose a new webinar platform provider. 

Choose A Good Location

Your own location during the webinar is very important. You want to look for the following when choosing the location from where you’ll host the webinar: 

• Sound not too echoey (no empty basements)
• Good internet connection (preferably wired)
• Sound not muffled (no closets)
• No chance of being interrupted by family, kids, etc. (behind a locked door or in a private office)
• Desk space for all your materials (including drinking water for yourself)
• Professional background if you will appear during the webinar (no unmade beds or kids’ toys in the background)

Offer a Q and A Session

About halfway through your webinar, or at the very end, offer a Q and A session. If you hold a Q and A halfway through, it will serve to break up the time, reinvigorate your audience and possibly help steer the focus of the remaining half. If you hold the Q and A at the end of the webinar, it will allow those who don’t have questions to drop out, and you’ll know who’s really interested by those who remain. If you’re hosting your webinar as a way to garner business leads, having the Q and A at the end is a better choice. 

Be Conscious of Time Constraints

Remember that even if you have a lot of things to cover in your business webinar, you shouldn’t try to cram everything into one session. Your viewers only have a certain amount of time to devote to your webinar. The longer your webinar is, the fewer viewers you’ll have, simply because people don’t have a lot of spare time. Few people want to participate in a three-hour webinar. The best length of time for a webinar is an hour or less. If you have to run an hour and a half it’s okay, but your content had better be worth the extra time. If you have too much content to cover in an hour, consider splitting it up into multiple webinar sessions. Remember to include extra time for a Q and A session in addition to the standard hour. 

Use Anecdotes

People love stories. Stories can help drive your point, add a humorous note, lighten the mood or help participants get a better sense of who you are. Sprinkle in plenty of anecdotes in your webinar content. They don’t have to be long-winded. Shorter anecdotes are better, since you always do want to be aware of how much time you’re using up. The anecdotes can be from your own experience or from a story you’ve heard. It doesn’t matter where they come from; only that they are somehow relevant to your webinar content. 

Avoid “Math” Slides

Many people use slides for their webinars. This is great, because it gives participants something to look at as you’re speaking. Slides can also help participants to grasp what you’re explaining. But unless your webinar is specifically math-focused, avoid “math” slides. Math slides are ones with multiple equations or lots of numbers, trying to convey some sense of urgency or importance to a piece of content. For the average person, heavy math slides can be intimidating or even boring. Instead, convert any math you need to communicate into attractive graphs and charts. Use vivid colors in your charts and graphs to help grab your participants’ attention. 

Modulate Your Voice

Even the most fascinating content can be rendered boring if it’s narrated by a flat voice that rarely varies from one tone. Try to modulate your voice so the tone goes up and down in appropriate places. Smile when speaking – your participants will “hear” the smile. The more interesting your speaking voice is, the more interesting your content will sound. If you’re unsure if you’re modulating your voice enough, record yourself speaking some of your webinar content and play it back for a friend to get their reaction. 

Review Your Content and Cut the Fluff

Lastly, you want to ensure that your content is useful and that participants leave feeling that their time was spent in a valuable way. One way to make sure of that is to carefully review what you’re going to say and cut out any fluff. Fluff is extra content that is extraneous to the point. For instance, giving excess examples when one will do, re-stating the same thing numerous times or spending lots of time explaining something that’s common knowledge. The more streamlined your content, the less time it will take and the more value your participants will get in return for their time. 

Hosting a business webinar for the first time can feel a little scary. But once you get through your first one, you might find that you really enjoy it and want to make it a regular event. These tips will help to ensure every business webinar you host is a resounding success.

Gone are the days when you had to drive to the bank to do a single transaction. Research has shown that more than half of the adults in the U.S. bank online, while about a third bank using cell phones. You can do almost all transactions through the convenience of your phone or your desktop.

Despite being convenient, online banking comes with some risks. Your bank account data or identity can be compromised if you are not alert. When transacting online, you need to be aware of the decisions that you make, because some of them can put you at higher risk. Here are some online banking tips to help keep your money and identity secure when conducting transactions.

1. Change Your Password Regularly

The best thing you can do to protect yourself is to change your password at least every 90 days. Ensure that your password is a combination of lowercase letters, upper case letters, numbers, and special characters. Avoid words that other people can easily guess, such as your pet's name or your family member’s name.

When setting up online banking, it is common for your bank to request you to answer a few security questions. You do not have to give the real answers to these questions. You can provide solutions that only you can remember.

Changing passwords may seem irritating because you can easily forget them. However, this simple act can help protect your account and identity from hackers.

2. Avoid Email Links

Never be too quick to click on any URL in an email. Even if the URL looks legitimate, it could take you to a place that you did not want to go. The safest thing to do is to personally enter your bank’s URL when you need to access your bank’s website.

Additionally, avoid opening any suspicious emails. Some emails may try to trick you into disclosing your banking information. Keep in mind that your bank won't ask for your data through a text or email. If you receive any suspicious email or text asking you to disclose your personal information, you should act fast and report it to your bank.

3. Don't Use Public WiFi

Public WiFi doesn’t offer the security you need to conduct online banking transaction. When using it, always have an assumption that anyone can access your browsing history and your passwords. You are putting yourself at higher risk any time you bank online using public WiFi. If you absolutely must do online banking while in a public space, consider using your private cellular network for internet access.

4. Check Your Bank Statement Regularly

Banks have controls in place to recognize fraud. Even though these controls exist, they may not identify all potential fraudulent transactions in customers' accounts. To ensure that no questionable transaction took place in your account, it would help if you reviewed your monthly bank statement carefully. If you find any unusual transaction, you should contact your bank immediately.

5. Use Your Bank’s Official Mobile Banking App

Financial institutions do everything possible to ensure their own mobile apps remain secure. In fact, using a bank’s official mobile app may be safer than using your own computer. You can download your bank's official mobile banking app and use it instead of accessing online banking from your desktop to increase your online banking security.

6. Allow Your Bank to Send Text Alerts

Sign up for text alerts if your bank has that option. Whenever money is withdrawn from or deposited into your account, your bank will send you a text. These frequent notifications allow you to monitor your account's activity and take note of the suspicious ones. You should contact your bank immediately if you receive a text about any transaction that you did not initiate or authorize.

7. Update Your Devices Regularly

Updates can be annoying because they often take hours or minutes to complete. It’s understandable if you’re tempted to put them off. However, you need to update your phone or computer regularly to ensure that they are protected against malware and security breaches. Updates are often implemented as a way to patch up a newly discovered breach in the software.

8. Don’t Use Automatic Login

Automatic login allows your browser to save your password and username; hence, you do not have to remember your login information whenever you want to access your bank account. While this is convenient, it’s not entirely safe. What if your phone or computer gets into the hands of an unauthorized person? They could easily access your bank account information just by opening up your browser or banking app. If you have enabled this feature on any of your devices, consider disabling it.

9. Enable Two-Factor Authentication (2FA)

Your bank will probably give you the 2FA option. Enable the option to allow your account to get the extra protection that it deserves. Signing up for two-factor authentication will enable you to get a unique, one-time password every time you access your account. While the extra step may seem like an inconvenience, it is worth the effort. Whenever you try logging into your account, you will always get a text or email with a unique code. If you are not the one who initiated the request, you’ll be able to stop the hacker immediately.

10. Secure Your Mobile Device

If you use mobile banking regularly, you should utilize all the security features of your smartphone. Avoid leaving your phone unlocked. You can lock the home screen with a pattern, pin, or a fingerprint. If your phone is ever stolen, the thief will have a hard time trying to get into it.

11. Log Out at the End of Each Session

It also helps if you log out of your banking session as soon as you finish your business. This lessens the odds of becoming a victim of session hijacking. You can also decide to set up private browsing on your smartphone or computer, and allow your browser to clear its cache after every session.

The 11 tips listed above will help you avoid problems when banking online. If you want to be safe when doing online banking, consider implementing all of these recommendations. If you do run into trouble, alert the bank immediately so you can limit or stop the damage.

Hiring a CPA to help you with your accounting and your taxes is a smart thing to do. Whether you’re a business owner or a regular taxpayer, a quality CPA will be a huge asset in many different ways. A CPA acts in the role of a financial advisor, a strategic unofficial business partner and a confidant. For example, if you’re having troubles with cash flow, your CPA will alert you ahead of time and even offer solutions. The caveat to all of this is hiring the right CPA to begin with. Here’s what you should be looking for in a CPA.

Personal Compatibility

It’s not often mentioned in the list of qualifications you should seek in a CPA, but personal compatibility is essential. You’ll be interacting with your CPA frequently during the year; not just at tax time. It’s important that you have a good rapport and mutual respect. The reason is that sometimes your CPA may need to deliver bad news or help you to rein in some unhealthy business practices. You need to be able to hear these words and consider them as your CPA looking out for your best interests. At the same time, your CPA should be a person who listens to your side of things when something is disputable. You don’t need to be best friends with your CPA, but personal compatibility is a must.

References

Since any CPA you will be considering will be licensed, you may feel that asking for references is insulting. However, not all CPAs are equally skilled. It’s very acceptable—and even expected—for you to ask for at least two references from any CPA you are vetting. A quality CPA should be able to give you the contact information for a couple of clients who will speak to their quality of service. Make sure you follow up with the references and ask about things like customer satisfaction and whether or not that person would recommend that particular CPA.

Online Reviews

It doesn’t hurt to check the online reputation of any CPA you’re thinking of hiring. People are very keen on leaving both positive and negative reviews on sites like Yelp and on Google reviews. A 10 or 15 minute search is all you need to conduct to get a sense of how well the CPA has treated past clients. Make sure you get the reviews from third party, independent sites as opposed to the CPAs own website.

Availability

It’s important to ask the CPA how frequently they are in touch with clients. Some CPAs are very good at being personally available for their clients as much as reasonably possible. Others prefer to focus on their work and leave the day-to-day messages and interactions to their staff members; only meeting with clients personally in the case of emergencies. Consider how you would like your interactions with the CPA to be and try to find a CPA who is willing to be available on the telephone or in person as much as you think you will need.

Relevant Experience

If you’re hiring a CPA for your business needs, you should try to find a CPA with relevant experience in your industry. It’s very helpful to work with a CPA who understands your business without you having to explain every nuance. Certainly, there will be particulars that are specific to your business, but you shouldn’t have to explain every single little thing. Over time that could be frustrating for both of you. During your interview, ask if the CPA understands your business model and if they have experience working with similar clients.

Affordable Fee Structure

Another thing that you will want to address in your interview with the CPA is how they bill. CPAs vary greatly in how they arrange their fee structure. Some have a flat fee structure, with special extras added on as necessary; others bill by the hour no matter what service they are performing. All CPAs will likely have an hourly minimum. So that you can be sure you can afford any particular CPA, make sure you fully understand how much and how often you will be billed.

Representation

If you are audited, you might want to have your CPA with you to deal with the audit. Some CPAs offer this service, but not all. Find out whether or not the CPA offers representation and how they do it. Some CPAs will only represent you in an audit if you stay out of it. This may sound harsh, but often audits go more smoothly when it’s just two or more financial professionals working to resolve an issue. Other CPAs will only represent you if you agree to attend all the audit meetings; it just depends on the CPA and their policy. The CPA should be willing to represent you during an audit in some regard, because they need to demonstrate that they stand behind their work. Choose a CPA whose representation policies align with your wishes.

Proximity

Many CPAs have secure online portals on their websites where they can communicate with clients and you can each send files to one another. This makes it convenient if you don’t live or work near your CPAs office. But if you are a person who feels more comfortable with face-to-face interactions and your CPA is willing to meet with you on occasion, you might prefer to hire a CPA whose office is nearby. This is a personal preference, but it’s worth considering when hiring a CPA.

This covers everything that you should look for in a new CPA. By all means, make sure you cover each of these when making your decision about whom to hire. Ideally, you’ll be working with the same CPA for many years to come. It’s nice to be able to build a solid working, professional relationship with this important part of your financial team.

Financial Considerations in Refinancing your House: Pros and Cons

If you’ve owned your home for a couple of years, you might have started thinking about refinancing. Maybe interest rates have dropped, and you want to save money, or you want to tap into your home’s equity to remodel your kitchen.

Learn about the pros and cons of refinancing your house and how it could impact your financial situation so you can make the best decision for your family.

Pros of Refinancing your House

Here are some of the reasons why you might consider refinancing.

• Lock in a lower interest rate and lower monthly payment
• Refinance into a better loan product
• Free up equity for a remodel or other purposes

Interest rates fluctuate over time. If rates have dropped significantly since you first bought your home, it could be worthwhile to refinance. Since you’ll pay fees to refinance, most financial advisors recommend that you plan on staying in your home for at least five years after the refinance.

Another reason to refinance is to get into a better loan product. An Adjustable Rate Mortgage, or ARM, enables homeowners who expect their income to grow in the future to get into a home now. But after a set time period, typically five years, the interest rate resets. To avoid a rate hike, you might think about refinancing.

While home appreciation isn’t guaranteed, in most cases, your home’s value will grow over time. A cash-out refinance allows you to tap into your increased equity. You could use it to remodel your kitchen, pay for a child’s college education, or consolidate and pay off higher-interest debt.

Whatever your reasons for thinking about refinancing, weigh them against the downsides of the process.

Downsides to Refinancing your House

There are costs involved in a refinance which you should consider before filling out the online application. Banks charge fees which could become substantial. Evaluate those fees against the cost savings of a lower mortgage payment, and take into account how long you plan on staying in your residence, before going through with a refinance.

Common fees you might have to pay include;

• Application fees
• Processing fees
• Underwriting fees
• Appraisal fees
• Inspection fees
• Title fees
• Attorney fees
• Recording fees

On average, fees could be between 2-4% of the amount you’re refinancing. That percent doesn’t include any mortgage interest, or points, that the lender could ask you to pay at closing. If you don’t have this money available, or if spending it would negatively impact your finances, a refinance isn’t a good idea.

In addition to the expense of refinancing, there’s your time. Applying to refinance a home takes just as much time as applying for a mortgage. The underwriters will request the same amount of information, from paystubs to tax returns, and you’ll be busy pulling together documentation and answering questions.  

Another downside to a refinance is that it could reset the clock, so to speak, on paying off your home. If you’re in the 15th year of homeownership on a 30-year loan and you refinance for another 30-year loan, you’ve extended your repayment term. If your goal was to pay off your home sooner, this could be disheartening.

Tax Implications of Refinancing a House – Points Paid

Refinancing your house can help reduce your tax burden in April. If you itemize your deductions, you can deduct mortgage interest.

Most lenders require that you pay points up front in a refinance. This protects their profit on the loan. Points are tax-deductible, either over time or during the year you refinanced your house. To deduct the full amount in the same year, you must meet the following requirements;

• You refinanced your principal residence.
• Paying points is customary where you live.
• The points you paid weren’t excessively high.
• Points didn’t cover other fees, such as appraisal and inspection fees.
• Can’t have borrowed from your lender or mortgage broker to pay the points.
• Points were computed as a percentage of your mortgage’s principal.
• They’re shown as points on your settlement statement.

If the points you paid don’t meet these requirements, you can deduct them over the life of the loan. If you sell the house before you’ve fully deducted the points you paid, you can take the remainder of the points paid as a lump sum in that year. If you have any questions about their deductibility, hire a professional to prepare your taxes.

Tax Implications of Refinancing a House – Interest Paid

Another way that a refinance could impact your taxes would be if the amount you pay in mortgage interest goes up across the board. Some homeowners refinance to get out of an ARM that will be resetting soon and to lock in a fixed payment, not necessarily to get a lower interest rate.

If you’re now paying more interest in your monthly payments, you’ll see a bigger deduction at year-end.

Refinancing your home could be an excellent way to improve monthly cash flow or realize your dreams. Just make sure you have the time available and that a refinance will lead to a net benefit for your financial situation in the long run.

A recent study confirmed that over 16 million people were the victims of identity theft in the span of one year in America alone, which resulted in $16.8 billion in stolen money. Identity theft is dangerous to your wallet and to your credit. Identity thieves use your information to take out loans, obtain credit cards, make purchases, get apartment leases and much more. Since these items are acquired with your credentials, these people don’t bother paying bills on time or at all. In the vast majority of cases, when your identity is stolen you’ll be held responsible for all the outstanding debt.

Warning Signs of Identity Theft

The Federal Trade Commission has outlined some helpful warning signs to know if your identity may have been stolen. These include:

• Unfamiliar bank activity on your bank statements
• Collection calls from debtors you don’t recognize
• Merchants suddenly declining your check purchases
• Unusual credit report activity
• Letters that you’ve been denied credit even though you did not apply
• Bills for services you didn’t sign up for
• Unusual lack of mail
• Medical claim rejections
• IRS notice that your refund was already disbursed
• Published news that a company has had their data hacked
• Your wallet has recently been lost or misplaced

The Dangers of Identity Theft

As you know, negative credit reports cause a number of problems. You may have trouble getting credit for things you need, such as a home mortgage. There is also the potential for serious medical consequences of identity theft. For example, if someone uses your identity to obtain medical treatment or prescription medication, this could lead to medical errors when you need to be treated. If you’re unable to speak for yourself, your doctors could miss allergy alerts, or assume things about your condition that aren’t true.

If you discover that your identity has been stolen, experts advise that you deal with the situation immediately. Don’t wait for something else to happen.

What To Do If Your Identity is Stolen

If you’re certain that your identity is stolen, drop what you are doing and take the following immediate steps.

Call Your Bank

The first thing you should do is call your bank;  not your credit card companies. The reason is that your credit card purchases are protected. Depending on the company, you may only be liable for the first $50 or $100, if that. So call or visit your bank first. You don’t want someone emptying out your bank account. Speak to a bank manager about the issue and let them know you need to take out a sum of cash to cover your everyday expenses for a few weeks. Do this before blocking your account; otherwise, you may have to wait to be able to withdraw money from your bank. Next, ask the bank to freeze your account until further notice. Do this with any brokerage accounts you own, as well.

Call Your Credit Card Companies

The next phone calls should be to your credit card companies. Ask for the fraud alert department. Ask them to put a freeze on your accounts, and go over with them the last legitimate transaction you made. Anything after that would be fraudulent.

Contact the Place Where the Theft Occurred, if Possible

If you can pinpoint the first occurrence of the identity theft, such as a gas station, that may be helpful in apprehending the suspect. Contact the merchant and let them know what happened. However, don’t just leave it in their hands.

Call the Local Police Department

If the identity theft began locally to your knowledge, place a call to your local police department (not 911). Make a formal police report and get a copy of the report. Your credit card companies may ask for a copy of the report.

File a Report With The FTC

File a formal report with the Federal Trade commission. You can use this report filing to help your case in the event of denied credit in the future. This report will be especially helpful if your tax refund ends up getting stolen due to identity theft.

Report The Incident To The IRS

Call the IRS and report what happened. They can place your information in a database and give you a PIN number you’ll use for future IRS filings.

Contact Your Medical Providers

Next, contact all of your medical providers to alert them as to what happened. Try to ascertain if any recent prescriptions or treatments have been given that you have no knowledge of. Ask them to make a note on your file that your identity has been stolen.

Call the DMV

You’ll also need to contact your Department of Motor Vehicles. Ask them to confirm if there has been any recent activity with your driver’s license that you’re unaware of. It’s a good idea to go there in person so you can present your ID and face and they can confirm that’s the same information they have in their database.

Preventing Future Identity Theft

There are steps  you can take to prevent identity theft from happening again.

• Review your credit reports often
• Consider enrolling in a credit monitoring service
• Balance bank statements each month
• Avoid verbally applying for store credit cards while checking out
• Be aware of others’ presence behind you when using ATMs
• Change online passwords routinely
• Use a private P.O. Box if you live in an apartment building
• Periodically ask to review your own medical records
• Keep track of the whereabouts of your wallet
• Keep confidential files locked up at home and at work
• Don’t carry your social security card in your wallet
• Don’t make online purchases using public computers

Identity theft can be ruinous to your life and your finances. When it’s happened to you, you realize how much work is involved in getting your life back in order. But if you take the preventive measures outlined above, you can at least do everything in your power to make sure that it won’t happen again in the future.

Identity theft isn’t a new crime by any stretch of the imagination.  With the use of electronic fund transactions, electronic tax filing, and the general increase of personal data being available online, identity theft is easy to perpetrate and has increased significantly in the last few years.

There are numerous expensive services and software offered by credit-reporting bureaus and private companies that will assist in keeping your data safe.  However, most of these safety measures can be done yourself – for free.

The first thing to do is actually a don’t.  Don’t panic.  When most people hear the words identity theft, the image that comes to mind is that of a mysterious shadow figure who has taken over our lives, uses our social security number, and name to commit crimes and steal money, while we are lost trying to convince the world that it’s not us.  This scenario is great for the movies, but in reality, it happens to less than one percent of households in the United States. Most identity theft is actually created with someone fraudulently accessing your credit card information.  In most cases, your liability is severely limited.  Most individuals suffer no out of pocket costs and are just affected by the time and hassle of shutting down the old card and opening a new one.

A few easy ways to prevent this are:

• Never give anyone your Social Security number or other highly personal data over the phone, or email.  Remember, the Internal Revenue Service will not email you, and any call will be followed up by or be preceded by an official notice.  It is your right to wait for the notice before answering anything.  And only ever write your Social Security number on a check being sent to the IRS, and never on noncredit applications or other forms.
• Never leave a wallet or purse unattended, carry your Social Security card, or write down PINs and passwords.
• Store important documents like bank statements, financial account statements, medical records and the like in a secure place at home.  When disposing of them, be sure to shred them prior to throwing them out.
• Don’t place your date of birth, maiden name, pet’s name or any other security question answer on social media.  Do not use your birthday or home address as a part of any password.
• Sign up for any online or mobile alert service provided by your financial institutes.
• Do not click on links in emails from unknown sources.

Another way to prevent identity theft is to place a security freeze on your credit reports.  This will prevent anyone from being able to look at your credit report unless they already have an established financial relationship with you.  While this won’t stop certain lenders from giving out funds without a credit check, it will provide some protection.  Another method is to attach a fraud alert to your account.  This will mean that a lender doing a credit report will see the alert and contact you to make sure you have requested the application they are trying to process.

Be sure to secure your devices if you have internet access on them.  Be sure to update anti-virus, anti-spyware and anti-phishing software regularly.  Utilize strong passwords that contain upper- and lower-case letters, as well as numbers and symbols.  Make sure your mobile devices and portable flash drives are all locked with passwords/codes in case they are lost or stolen.

Keep an identity theft file protected in your home.  It should contain copies of your important documents, along with copies of the items found in your wallet – such as the front and back of credit cards, etc.

Periodically review your accounts and credit reports.  You are entitled to one free copy of your credit report every year from each of the three credit bureaus.  You also qualify for an additional one if you place a fraud alert on your account.  Stop unsolicited credit card offers.  Many times, thieves utilize the preapproved cards you receive by mail.  You can stop credit bureaus from selling your name to lenders by opting out.  Review your bank accounts more often that at month end.  Don’t assume that any transaction on the account is valid, even checks.  Also review your phone bill to ensure that phony services and charges haven’t been added to your account.

Tax-related identity theft is usually committed by using stolen Social Security numbers and other personal information to prepare and file fraudulent tax returns with the Internal Revenue Service.  With the creation of the debit card method of refund receipt by the IRS, fraudulent returns claiming large refunds have been filed early in the tax season by thieves.  Once the refund has been transferred to a debit card, it is often impossible for the IRS to trace the money.

One of the ways that taxpayers can help prevent tax-related identify theft is to file early.  Often the victim of tax-related identify theft is not informed of the theft until they attempt to file.  They will then be notified by the IRS that they are attempting to file a return with a social security number that has already been utilized on another filed return.  The return is then rejected.  This can create major complications to straighten out which is the legitimate taxpayer and unwind the refund.  Additionally, the taxpayer is generally the one forced to provide proof.  But, if you file first, the thief will be the one that is sent the rejection notice and will be forced to move on.

Respond rapidly to any suspected theft.  Contact your financial institutions right away and place freezes on your accounts.  File a police report, as some creditors will want to see it in order to complete their claim records.  Chances are that doing these small and simple actions will solve the problem in relatively short order, with little to no cost.

The following article provides a preliminary overview to blockchain technology. Additional information regarding this technology and its potential will be presented in subsequent articles. This information was presented in the Journal of Accountancy by Lou Carlozo:

Blockchain is one of the most popular—and controversial—topics of conversation among technology leaders in finance today. Many have called it revolutionary—a game-changing factor in the world of finance.

So what exactly do CPAs need to know about blockchain?

Essentially, as the Journal notes, blockchain is a digital ledger of economic transactions that is fully public, continually updated by countless users, and considered by many impossible to corrupt. It is a list of continuous records in blocks.

A blockchain database contains two types of records: transactions and blocks.

Blocks hold batches of transactions. The blocks are time-stamped and link to a previous block.

The transactions cannot be altered retroactively.

Here are four reasons finance executives and other CPAs should care about blockchain and its potential:

• Blockchain is much more than bitcoin. While many people in finance departments might mistake the mysterious and often volatile bitcoin for blockchain, they are two very different things. While invented to help transact in bitcoin, blockchain is the digital global ledger that not only records cryptocurrency transactions, but also provides a home for documents of all sorts. "Everything from property deeds, to birth records, to money such as bitcoin and various alt-coins resides on a blockchain backbone," said John Callahan, Ph.D., chief technology officer with Veridium, a company that specializes in advanced security technology. In fact, he described blockchain as "part of the iceberg beneath bitcoin."

• Blockchain could reshape the business of recordkeeping, and business itself.  According to Jon Raphael, CPA, chief innovation officer at Deloitte. "As scalable applications are deployed—and if they live up to their potential—blockchain will profoundly change how records are kept and transactions are processed."

• Many finance executives are lagging behind their peers. A 2017 survey by Deloitte found that about 60% of big company executives said they were knowledgeable about blockchain.

• Blockchain is becoming a powerful way to do business. Because blockchain allows for the transacting and securing of digital data, it is beginning to realize its potential to aid in a wide range of areas, from compliance to data management. "It will bring enormous efficiency in business transactions besides making them military-gradesecure," said Nitin Narkhede, vice president and head of blockchain and innovation at Mphasis, a digital IT services company. "Hence, there is massive interest in experimenting with the technology and applying it in every business process.”

While all of the above is complex and intriguing, the truth is we’re just getting started with learning about blockchain technology. The potential and possibilities are extravagant to say the least. We look forward to discussing the topic in greater detail within future newsletters.

In recent days the world has become familiar with perhaps the largest data breach event ever known to humanity. I’m referring, of course, to the Equifax data breach.

The incident, as summarized by Equifax Security, potentially impacts personal information relating to 143 million U.S. consumers – primarily names, Social Security numbers, birth dates, addresses and, in some instances, driver’s license numbers. In addition, credit card numbers for approximately 209,000 U.S. consumers, and certain dispute documents with personal identifying information for approximately 182,000 U.S. consumers, were accessed.

Information potentially stolen by the hackers, including Social Security numbers and dates of birth and names, could put people at risk of identity theft for the rest of their lives, credit experts warn. 

So how did such a massive breach happen?

USA Today notes that hackers took advantage of an Equifax security vulnerability two months after an industry group discovered the coding flaw and shared a fix for it, raising questions about why Equifax didn't update its software successfully when the danger became known:

"The Equifax data compromise was due to (Equifax's) failure to install the security updates provided in a timely manner," The Apache Foundation, which oversees the widely-used open source software used by Equifax, said in a statement.

At the time of USA Today’s article publication, Equifax had not responded to questions about when the patches were used to fix the security weak point, or if the patches were used at all.

It only made this statement: "We continue to work with law enforcement as part of our criminal investigation and have shared indicators of compromise with law enforcement.”

USA Today also reported the critical comments of other cybersecurity professionals:

“They should have patched it as soon as possible, not to exceed a week. A typical bank would have patched this critical vulnerability within a few days,” said Pravin Kothari, CEO of CipherCloud, a cloud security company.

By all accounts it appears that one of the fundamental reasons for the Equifax data breach stemmed from a failure or lack of timely attention to applying critical software patches. Arguably, had the patches been applied in a timely fashion none of the ensuing issues would have occurred.

Examples of Preventive Measures For Avoiding a Data Breach

IPR Secure notes that companies should take the following measures to avoid becoming another Equifax:

1. Stay Up-To-Date On Software

Install anti-virus software on servers and implement application firewalls. Any software or programs that are not up to date can increase risk and serve as an entryway for hackers.

2. Credit Freeze

Nearly half of Americans may have had their information stolen in the massive Equifax data breach recently, and experts say freezing your credit is one line of defense. 

According to the Federal Trade Commission, this tool lets you restrict access to your credit report, which in turn makes it more difficult for identity thieves to open new accounts in your name. That’s because most creditors need to see your credit report before they approve a new account. If they can’t see your file, they may not extend the credit.

If you opt for a temporary lift because you are applying for credit or a job, and you can find out which credit reporting company the business will contact for your file, you can save some money by lifting the freeze only at that particular company.

3. Monitor Access to Your Data

Require multi-step authentication processes for employee access, verifying business reasons for each system access, logging and monitoring employee use to identify unusual system patterns or behaviors, installing secure internet access points, and using IP address profiling to prevent any unauthorized access. Be aware of any unusual network activity and data transmissions to unknown hosts.

4. Change Passwords Frequently

There are many preventative actions when it comes to passwords, including using longer passwords with a variety of numbers and symbols, different passwords for different systems, mandatory password changes every 90 days, or requiring employees to “sign out” a specific administrator password so passwords aren’t floating around and easily obtainable by a hacker, both internal or external.

5. Take Physical Security Measures

Physical measures for safeguarding information can involve restricting access to facilities to prevent physical intrusions, monitoring computer equipment, locking up particular rooms or file cabinets housing sensitive information, and also shredding documents.

6. Educate Employees On Security Threats

It is important to educate employees on data security to reduce breaches from negligent behavior.

7. Periodic Risk Assessments

With periodic assessments, whether through internal audits or third party expertise, you can assess new areas of concern for potential security risks.

8. Implement an Incident Response Plan

For example, you should be prepared with resources your customers can access following a breach to prevent fraudulent charges to their accounts or phishing attempts.

In conclusion, while it appears that data breaches seem to be on the rise, there are practical solutions that can be taken that will go a long way toward mitigating the risk of data breaches in the future. The first step for any company is to change its mentality. Companies must become proactive, not reactive—aggressive, not passive. Take dramatic action now instead of waiting for a crisis to hit.

When choosing for the right qualified CPA for your business, the goal is to find a business advisor who is qualified to help take you from point A to point B—the long haul, in other words. The plan is to find the right complimentary relationship.

The CPA you should be looking for is someone who you can and will rely on. This puts a huge degree of responsibility on the advisor to give good advice to you, the business owner. Sound advice is advice that is constructive and productive. Bad advice is advice that will get you in trouble. Bad advice can easily translate into “no advice.”

There are various sources of suggestions and tips available to use as guides when performing your search for the “right” CPA for your small business. This article presents some of these suggested tips. The key is to match business needs with a CPA who is qualified and capable of helping you with identifying and satisfying those needs.

The following bulleted overview contains just a few of the ideas taken from the Small Business Administration’s (“SBA”) website.

Why Hire an Accountant?

An accountant can save you time and clear up much of the confusion you experience when it comes to managing your finances and taxes, but a trusted accountant can provide other benefits, too.

• Act as a Trusted Advisor – More than just a tax preparer, an accountant can become a trusted advisor to your small business, helping you manage cash flow, plan for growth, assess risk, and keep your books in order.
• Help Balance Business and Personal Needs – Many small businesses, particularly sole proprietors and startups, find that their business and personal finances are closely linked. A good accountant can help you make sound judgments beneficial to both.
• How to Find an Accountant

Referrals are often the best way to find accountants you can trust. Network and mingle at local business events hosted by your local Chamber of Commerce, Small Business Development Center, or other small business organizations.

Interviewing Candidates

Once you have a short list, schedule a free initial consultation to help determine whether your candidates are the right fit for your needs: 

• Some questions to ask include:

What’s your experience with small businesses? Small businesses have dynamic and sometimes complex accounting needs and few resources to manage them.  An accountant who understands these dynamics and has a solid small business client base will likely serve your needs better in the long run. You’ll also want to know that your accountant has experience with businesses that are structured like yours – whether you are a sole proprietor, LLC, partnership, or corporation.

What experience do you have with my industry? Ideally, your accountant should have knowledge of your industry.

Do you do more than tax preparation? If you want long-term strategic advice to help you manage your small business finances, be sure to ask about the range of value-add services, such as business valuation, budgeting and forecasting, bookkeeping, risk assessment, and small business startup advice.

Here are additional tips for finding the best accountant for your small business, as noted by Due, and they help round out the previous bullet points:

What Are Your Business Needs?

Prior to hiring an accountant, you need to ask yourself one very important question: what do you want an accountant to do for you? Do you need someone to handle all of your business’s bookkeeping and accounting?

Outside vs. Inside

If you’re just starting out, you may want to hire an outside accountant who can prepare taxes, financial statements, and provide advice. Your business size should determine if you need an outside or inside accountant.

Their Personality Matches Yours

You’re going to be working very closely with your accountant – even if it’s part-time. Even if they are the most talented accountant on the planet, if you can’t stand them or have a different work ethic, you probably won’t be able to be that productive.

Ask Who Their Current Clients Are

By knowing the accountant’s other clients you can see if they have experience in your industry. However, it also gives you the opportunity to speak to these business owners to see if they are satisfied with the accountant.

Additional Services

If you anticipate some major growth for your business you may want to have an accountant who is familiar with business and strategic planning, budgeting, cash flow management, and estate planning.

Firm is Right Size For Your Business

A smaller accounting firm would work best with a small business. It just wouldn’t make sense for an accountant who works with enterprises to work for a company that only has three employees.

Willing to Educate

It would make everyone’s lives easier if the accountant would be willing to educate team members on some accounting and bookkeeping basics.

Fluent in Your Current Accounting Software

If you’ve had success with a particular accounting software, and don’t want to switch, does the accountant have experience with it? If not, you need to discuss how vital business information will be assessed and shared.

The bottom-line with these tips: do not skimp on the decision-making process for selecting your CPA. It will affect your business for years to come, and it’s not something to rush into without doing your due diligence.