The Current Risk
You’ve likely read the news stories about the Capital One data breach that was detected last month. While this is not the first global company to have its data compromised, it is noteworthy in its scale: nearly 106 million of the bank’s customer and applicant accounts were affected. This recent incident comes about a week after Equifax announced a settlement over its 2017 data breach, which affected about 143 million people. While these occurrences are a constant risk in the current landscape, they remind us of the importance of taking proactive steps to safeguard our personal and financial information.
Whether or not you are a Capital One customer, here are some actions we advise you to consider taking to protect your personal data and accounts:
The Broader Issue: The Rise of Cybercrime and the Importance of Cybersecurity
The overarching issues raised by the Capital One data breach are the very real and growing threats of cybercrime and identity theft. Reported cybercrimes cost victims over $2.7 billion in monetary damages in 2018, according to the FBI.
As a registered investment advisor and fiduciary to our clients, Litman Gregory is bound by our fiduciary standard to put our clients’ needs first. Among other responsibilities, that means making sure our clients, and their confidential financial information that we hold, aren’t put at risk of scams, phishing, and a multitude of other techniques employed by cybercriminals.
In addition to regularly reviewing our cybersecurity policies and ensuring we are following best practices, we continue to work with a cybersecurity consultant to find new ways to protect our internal data as well as our clients’ privacy. If implemented correctly, proper controls can prevent 95% of external fraud. Some of the common tactics include:
In each instance, the fraudster attempts to impersonate someone electronically, thanks to the success of a “phishing” expedition into his or her personal emails and contacts. Sometimes this phishing is accomplished by luring someone into revealing personal information, either by email, through a copy-cat website, or over the phone.
We also suggest doing the following to help protect yourself against these and other fraudster tactics:
For many years at Litman Gregory, we have aided clients as they navigate the threats of cybercrime and protect themselves from attempted security breaches. Unfortunately, as the recent breaches indicate, cybercrime is on the rise and becoming more sophisticated. Looking ahead, we will continue to be on our guard and stay abreast of new ways that we, and our clients, can work to protect their identity and finances.
Do you have questions about how we protect client accounts or the steps you and your family can take to better protect yourselves and mitigate risk? Please call your Litman Gregory Advisor or contact us here.
Commentary from Our CIO—Second Quarter 2021
Global stock markets continued to surge in the second quarter. In our assessment of the macroeconomic backdrop and outlook, we continue to expect a strong global economic recovery over at least the next 12 months. In this quarterly commentary, our Chief Investment Officer, Jeremy DeGroot, reviews the current reasoning for our portfolio positioning, outlook on inflation, and forward-looking scenario analysis on the broader economy and markets.
Research Update: Increased Return Expectations for U.S. Stocks
As the economy and financial markets continue their recovery from the pandemic’s impact, our recent analysis resulted in improved expected returns for U.S. stocks. In this post we summarize our analysis and why we think an increased allocation to U.S. equities could benefit the risk-adjusted return profile of our portfolios.
Advisor Q&A: Tax Planning and the American Families Plan with Senior Advisor Chris Wheaton
The American Families Plan was recently released by President Joe Biden and includes many of the provisions outlined during his campaign. We asked Litman Gregory Senior Advisor, Chris Wheaton, to answer some questions about key proposed tax law changes, and related tax planning ideas for our clients to consider in 2021 and beyond.