Tag Archives: identity verification

Blockchain – Breaking It Down

The hottest word in technology is blockchain. Whether you have heard of  it or not you will be affected by it, now or in the future. But what is it?  How will it change things?

What is Blockchain?

A block is a record or log of new transactions. This log can track things like the the creation of cryptocurrency, changes to medical records, product manufacturing from start to finish or banking transactions. After each block is completed it’s added to the chain, creating a chain of blocks, hence a blockchain.

Information on the blockchain is also available to everyone. A block chain is not hosted on a single computer or server. Because of this any changes or transactions are immediately visible to everyone. So, as you can see a blockchain is very hard to falsify because everybody can see the changes and immediately notice if something is wrong or fraudulent. Blockchains are simply a public ledger that makes everything  traceable.

Blockchain was invented in 2008 to support transactions using digital currency. If you buy something using a cryptocurrency, send some to a another person or sell it, your transaction is publicly visible on the blockchain. Other people may not know who you are but they can see exactly how much has been transferred from one person to another.

Blockchain and cryptocurrency like Bitcoin are growing as an alternative to traditional banking. Users do not need a bank to move money from one location to another or to verify the transaction. This is sometimes referred to as frictionless transactions. This means a transaction can be completed without a paying a fee to a bank or government.

How is Blockchain being used?

Although blockchain is not yet in widespread use it is expected to change industry and commerce in a revolutionary way. It is considered a disruptive technology that can easily turn the economy and society upside down. As such, it is being carefully examined and introduced.

Blockchain and your vote.

Blockchain technology can can make electronic vote counting un-hackable. Voter fraud can be eliminated by securing the system during voter registration. Blockchain can secure voter’s identification and prevent vote tampering. Blockchain creates a permanent and public ledger of votes cast and tallied that provides for more fair, secure and democratic elections around the world.

Follow My Vote is one new start up company that is trying to apply blockchain to our voting systems.

Blockchain and your identity.

Blockchain is expected to make major difference in securing your digital identity. Right now billions of dollars are being lost due to online fraud and identity theft. Using blockchain technologies will make tracking and managing digital identities secure and efficient. The result will mean a seamless sign-on and reduced fraud. This is vitally important when it comes to banking, healthcare, national security, citizenship documentation and e-commerce. 

Currently password based systems rule the Internet. Blockchain technology is based on identity verification using  public key cryptographyUsing blockchain identity authentication the only question is if the person has the correct private key. It is understood the key holder is the owner and the exact identity of the owner is irrelevant. The only drawback to this system is, as always, the human factor. People share passwords they may begin sharing encryption keys.

Blockchain identity verification can allow you to securely apply for jobs, file for medical and other various benefits, remotely open bank accounts, verify emails and social media activity and, as mentioned earlier, secure voting.

Blockchain for business.

Blockchain has the ability to make sure corporations are playing by the rules. Records stored using blockchain suddenly become difficult, if not impossible, to alter.This factor means that contracts between people or between corporations are far less open to interpretation of manipulation. These are know as smart contracts.

Smart contracts are legally binding, programmable digitized contracts entered on the blockchain. Programmers can create legal contracts as variables and statements that can release funds using the bitcoin network.

An example would be if one company wanted to pay another company a million dollars at a specific time when the preconditions of the contract are met. The conditions, payout, and details would be programmed into a smart contract. Once all conditions are satisfied the money would be sent to the appropriate party as terms of the contract dictates. Computer control over contracts can increase business efficiency and make the legal system more equitable.

Blockchain is coming to a grocer near you.

Companies in the agriculture industry are using blockchain  to track the movement of produce through the supply chain. This means the farmer can track his bell peppers from the time they leave the field to the time you leave the grocery store with them. Blockchain creates a direct link from the farmer to the grocer ensuring they are paid fairly for their produce and allowing grocers to verify that they are getting what they’ve paid for. Blockchain use in agriculture means you know exactly where your food came from and who handled it. Keep in mind food fraud is growing problem. Is that fruit really organic? Is that fish really sea bass or is this olive oil really olive oil? Blockchain makes sure you get what you think you are getting and paying for.

This technology can also increase food safety and security. Blockchain brings transparency to the supply chain allowing retailers, farmers and consumers to identify and remove bad actors and poor processes. Blockchain can determine the source of food born illnesses quickly in the event of a illness outbreak saving time, money, and lives.

Blockchain and transportation.

Another way blockchain will affect your life is transportation. Car makers are using blockchain to make sure the parts that go into your car meet their standards and come from a legitimate source. Counterfeit parts are a big problem on the secondary parts market. These parts could possibly end up in busses, trains and even aircraft endangering millions of lives. Parts can now be tracked from the manufacturer to the user eliminating any possible counterfeiting.

Now you know.

 

 

 

 

 

 

 

 

 

 

 

 

Tax Season Safety

IRS_LogoAs tax season gets into full swing here is something you are going to want to be aware of before something bad happens. First off, there is a procedure that the IRS uses to confirm your identity. You need to be aware of this because I guarantee criminals are and they are robbing people everyday.

Tax refund fraud will cost people over $21 billion dollars this year.

In the event the IRS needs to verify your identity you will receive a 5071C letter. You will need to have your prior year’s tax return and current year’s tax return, W-2, 1099, and Schedule A and C ready before you take steps to verify your identity. Verification takes place in two ways.

  1. Call the number at the top of  5071C letter to speak to someone at the agency.
  2. You will be asked to answer a series of questions at idverify.irs.gov. These questions will be related to your contact information and information from last year’s tax return like your adjusted gross income.

This process can be a frightening experience especially if you, or the IRS, suspect identity fraud. Now, as I said earlier, you need to be careful not to fall victim to any scams. You will know it’s the IRS reaching out to you because you’ll get the official 5071C letter in the mail. The IRS never initiates contact with you by phone or email. Should you receive an unsolicited email that appears to be from the IRS, report it by sending it to phishing@irs.gov. Don’t click on any links or open any attachments.

But the real problem is that scammers know how the IRS operates and have found the weaknesses.

A prime example was found on Krebsonsecurity.com. The article describes the efforts of a man who had to fight for his identity and tax refund when it was stolen…from the IRS! How? According to the article the scammers managed to get his information by copying all of the data from his previous year’s W2. The victim believes the scammers obtained that W2 data directly from the IRS. Apparently they created an account at the IRS.gov portal, idverify.irs.govin his name then used a different email address and requested his tax transcript. As I said the crooks know the system and how to work it. The point being you need to register with the IRS before some crook does it for you. Don’t fall for any IRS information requests via text messages or social media either.

This situation is really terrifying because not even the IRS systems are as safe as you may think. It is a well known fact that the IRS systems are outdated and the agency is under-staffed and poorly trained.

Sadly the IRS is not the only government agency whose identification methods leave Americans vulnerable. Believe it or not the same process used to obtain a tax transcript at IRS.gov will also work to obtain a free credit report from annualcreditreport.com a government mandated website.

Americans who have not already created an account at the Social Security Administration under their Social Security number are also vulnerable to crooks hijacking Social Security benefits.

Here are a few other things you need to know. IRS.com is different than IRS.gov. Don’t get them confused. There are plenty of fake IRS websites you’d better be looking for.

Here is some more helpful information for taxpayers to help keep you safe.

A YouTube Video of Tax Scam Artist on the phone.

YouTube videos on identity theft from the IRS.

Searchable directory of preferred tax professionals.

Now you know.