- Nearly half of Americans say ID theft is likely to cause them financial loss in the next year.
- Only 3 in 5 Americans report having ever looked at their credit score.
- According to a leading cyber security company, cybercrime cost U.S. consumers $19.4 billion of their own money in 2017.
Another day, another data breach. Recent news about cybercriminals obtaining more than 5 million credit card numbers from high-end U.S. retailers joined a series of major hacks and online data breaches. In 2017 alone, roughly 143 million U.S. adults, were hit by some form of malware, virus, spyware or phishing scam. Unfortunately, the frequency of attacks on Americans’ personal information has fostered a feeling of inevitability. In fact, according to results released today from a telephone survey conducted by The Harris Poll for the American Institute of CPAs (AICPA) of 1,006 Americans adults in the fall of 2017, nearly half of U.S. adults (48 percent) think it is at least somewhat likely identity theft will cause them financial loss in the next year.
“Protecting your information is an ongoing process that requires you to be vigilant, identify where you can improve and take action to firm up your safeguards,” said Gregory Anton, CPA, CGMA, chair of the AICPA’s National CPA Financial Literacy Commission. “This means regularly monitoring your credit card and bank statement and periodically checking your credit report for anything that looks out of the ordinary.”
While the survey finds that three out of five Americans (61 percent) have at least looked at their credit report, more than a third (35 percent) have never once checked. This is particularly alarming, as a majority of those who have checked their credit (66 percent) had to take steps with a credit reporting agency to correct inaccuracies, with the average being 13 specific corrections among those who have taken steps at least once. More distressing, those with a household income of less than $35K were found to be more likely to never have looked at their credit report than those with a household income of $100K+ (44 percent vs. 30 percent).
“Having a good credit score and access to favorable interest rates is something that benefits people of all income brackets, but it is particularly important for those who are in a financial situation where a few percentage points in interest would make a big impact on their financial wellbeing,” added Anton. “Everyone should check their credit score for free with one of the three major credit reporting agencies at least once a year and not wait until suspicious activity occurs.”
The frequency and scope of these cyber-attacks has many Americans questioning the effectiveness of cybersecurity practices businesses currently have in place. In fact, eight in ten Americans (81 percent) said they are at least somewhat concerned about the ability of businesses to safeguard their financial and personal information, with two in five (40 percent) reporting that they are extremely or very concerned.
With security breaches costing U.S. consumers $19.4 billion of their own money, this may be a cause for action. The survey found four in five Americans (81 percent) said they’ve changed their behavior based on the threat of cyber breaches affecting credit card and debit card processing systems. Those changes include a majority increasing self-monitoring of credit and debit card accounts for fraudulent activity (56 percent), while about 4 in 10 are either using cash and/or checks more often (43 percent) or choosing to shop at locally owned stores more often instead of national retailers (40 percent).
“While it’s positive that American are taking steps to mitigate the risk from cyber breaches, each time there is a new breach in the headlines there is the risk that the public becomes numb,” added Anton. “Identity theft may seem like it’s inevitable, but our message is that it doesn’t have to be.”
A quarter of Americans (26 percent) said they have reduced their online presence, either turning off social media or visiting fewer websites because of concerns about data security. One in five (20 percent) have signed up for additional fraud detection or credit monitoring. Roughly 1 in 10 report they are switching their shopping to different national stores because of concern about data breaches (11 percent), placing a freeze on their credit (11 percent), or shopping online more often, because they feel like it is safer (11 percent). Five percent said they use alternative forms of currency.
Additional Findings – Victims of Scams:
The survey found that three in five U.S. adults (60 percent) report that they or an immediate family member have ever been the victim of a scheme to defraud them, including:
- 34 percent — A letter, email or phone call from someone impersonating the IRS
- 28 percent — Theft of an existing credit card number
- 26 percent — A fraudulent email phishing scam
- 18 percent — Solicited for donations for a fraudulent disaster relief charity
- 11 percent — Opening a new line of credit in your or their name
- 10 percent — A ponzi or pyramid scheme
- 6 percent — Someone obtaining a tax refund in your or their name
The AICPA’s National CPA Financial Literacy Commission offers the following tips to help Americans prevent and mitigate the effects of identity theft:
- Monitor your credit report & set protections. You can request a free credit report from all three major credit reporting agencies once a year, including TransUnion, Equifax and Experian. Additionally, some monitoring services allow you unlimited access to your credit information year-round. These services are there to help you spot inaccuracies, potential fraud and more on your credit report. This should also be done for children. Theft of a child’s ID may go undetected for many years such that by the time they are adults, the damage has already been done.
- Don’t provide your Social Security number unless it’s necessary. A space for it on a form doesn’t necessarily mean that it is required. For example, your doctor’s office may use a unique number issued by your insurance company to enter your claim but their form may have a space for SSN anyway. Don’t be afraid to ask if they really need it.
- Make sure your WIFI network at home is secured with a password. A skilled data thief can access information on an unsecured network. Additionally, when away from home, avoid providing credit card or other personal information on unsecured Wi-Fi networks like those in airports or coffee shops.
- Don’t provide personal information in response to any unsolicited communication. Even if the caller, text or email claims to be from a bank or credit card company needing to “verify” your account to “prevent fraud.” If in doubt, call the number on your bank statement or the back of your credit card.
- What to do if it happens? Act quickly to limit the damage. Call your credit card company and report it to them. They will close your card and issue a new one. File a police report to ensure that you are covered for any damages that you may incur. If your Federal return is affected, call the IRS 800-908-4490 and file Form 14039 Identity Theft Affidavit.
For more information about what to do in the event of identity theft, 360 Degrees of Financial Literacy offers tips here.
This survey was conducted by The Harris Poll by telephone within the United States between October 12 and 15, 2017, among 1,006 adults (503 men and 503 women aged 18 and over) including 506 interviews from the landline sample and 500 interviews from the cell phone sample. Figures for age, sex, race/ethnicity, education, region and household income were weighted (using data from the Current Population Survey) where necessary to bring them into line with their actual proportions in the population.
Shift to sun, ski and suburbs gives Airbnb advantage over hotels
By Ankit Ajmera
(Reuters) – Airbnb’s quarterly results are likely to show the pandemic may have helped the home rental company lure leisure travelers away from big hotels during the global travel collapse of 2020.
Weary of being locked up in their homes for months, travelers hit the road and booked homes and cottages on Airbnb, while avoiding flights and downtown hotels, analysts said.
Airbnb accounted for 18% of the total U.S. lodging revenue in 2020, up from 11.5% in 2019, data from hotel analytics provider STR and vacation rental data company AirDNA showed.
It outperformed the hotel industry and online travel agents such as Expedia and Booking.com thanks to its greater offer of ‘sun, ski, and suburban’ rental homes, Cowen & Co analysts said.
(Graphic: Airbnb grabs bigger share of U.S. lodging market in pandemic: https://graphics.reuters.com/AIRBNB-RESULTS/yxmpjxqdopr/chart.png)
For an interactive graphic, click here: https://tmsnrt.rs/3pPbQwH
In 2019, about 90% of Airbnb’s bookings came from leisure travels compared with about 20%-30% for large hotels chains, including Marriott and Hilton, that rely on business travel to grow their profits.
“Unfortunately, the hotel operators do not have as much supply in locations where people are willing to travel,” said Jamie Lane, vice president of research at AirDNA.
Lane said with mass vaccinations later in the year, the share of alternative accommodations including Airbnb will drop before continuing to grow at 2%-3% per year once normal travel patterns return.
(Graphic: Airbnb U.S. sales against top hotels: https://graphics.reuters.com/AIRBNB-RESULTS/gjnpwzkdbvw/chart.png)
For an interactive graphic, click here: https://tmsnrt.rs/3dPKvsd
* The San Francisco-based company is expected to report gross bookings of $23.10 billion in 2020, down from about $38 billion a year earlier, according to the mean estimate of 12 analysts according to Refinitiv; gross bookings are seen rising by 50% in 2021.
* Analysts’ mean estimate for Airbnb’s full-year net loss is $3.52 billion, bigger than a loss of $674.3 million a year earlier. Full-year revenue is expected to drop 32% to $3.27 billion.
WALL STREET SENTIMENT
* Of 34 brokerages, 20 rate Airbnb’s stock “hold”, 12 “buy” or higher and two “sell” or lower
* Wall Street’s median 12-month price target for Airbnb is $156â€‹, about 22% below its last closing price of $200.20.
* The company’s stock has nearly tripled since listing in December
(Graphic: Airbnb’s stock has nearly tripled since debut: https://graphics.reuters.com/AIRBNB-RESULTS/jznpnoqrlvl/chart.png)
For an interactive graphic, click here: https://tmsnrt.rs/3dG2lOd
(Reporting by Ankit Ajmera in Bengaluru; Editing by Sweta Singh and Saumyadeb Chakrabarty)
Britain to introduce greener gasoline at petrol stations by September
LONDON (Reuters) – Britain is set to introduce E10 gasoline, a motor fuel blended with 10% renewable fuels, by September this year, a move that could cut annual CO2 emissions by 750,000 tonnes, the government announced on Thursday.
Current gasoline blends in Britain contain no more than 5% ethanol (E5), but the introduction of the E10 grade could cut transport emissions equivalent to removing 350,000 cars from the roads, the government said.
Bioethanol is made from materials including low-grade grains, sugars and waste wood.
“Using bioethanol in place of traditional petrol can reduce CO2 emissions and, therefore, increasing the ethanol content of petrol could help us meet our climate change targets,” the government said.
Farmers welcomed the move which should lead to a significant rise in demand for some crops.
“Not only will this mandate provide a boost for the UK wheat and sugar sectors, it will play an important and immediate role in delivering the government’s green agenda, especially as it may be some years before we are able to make a countrywide shift to fully electric vehicles,” the National Farmers Union said in a statement.
The government said that the E5 blend would remain available at pumps in the “Super” grade for older vehicles that may not be compatible with E10.
Britain consumed around 11.7 million tonnes of gasoline in 2019, according to the latest government data, accounting for about a third of overall road transport fuel use.
The move is a major boost to Britain’s biofuels producers with Vivergo Fuels announcing plans to reopen a bioethanol plant in Hull, north-eastern England, which has been closed since September 2018.
Vivergo Fuels, a unit of Associated British Foods PLC., said the plant would start manufacturing ethanol in early 2022.
The bioethanol plant can produce up to 420 million litres of bioethanol and use up to 1.1 million tonnes of feed wheat.
The government statement also said a bioethanol plant owned by Ensus in north-east England would increase production.
Ensus is a unit of CropEnergies.
“Ensus is even now running at a high capacity usage level. But naturally such a market expansion is very welcome in view of the plantâ€™s future development,” said CropEnergies Chief Executive Stephan Meeder, adding he expected the British ethanol market to grow by up to 600,000 to 700,000 cubic metres per year.
(Reporting by Ahmad Ghaddar and Nigel Hunt, Additinal reporting by Michael Hogan; editing by David Evans and Jonathan Oatis)
How can finance leaders regain a long-term planning focus amidst the Covid crisis?
Vicky Wordsworth carved a reputation as a financial management specialist within private-equity backed businesses, before becoming CFO of the 158-year-old family-owned group of communications specialists – Bailie Group. Here, she considers the need for finance leaders to look beyond the turbulence of the pandemic and plan for the future…
The role of a finance leader is multifaceted. At the core, is a need to protect the balance sheet. However, in supporting the strategic progress of a business, there is increasingly a need for the profession to manage uncertainty to mitigate risks and leverage opportunities too.
This was true long before the onset of Covid-19. A Gartner guide from 2019 for example, highlighted that finance leaders were spending 25-50% of their time navigating unfamiliar situations, even then. And many years earlier, a Wall Street Journal article from 2014 cited advice from Deloitte which encouraged senior finance executives to drive corporate-wide, critical decision-making, that balances strategy, risk and finance in uncertain times.
So, while the health crisis has been a colossal blow to not just the world of commerce, but humanity on the whole, from a finance perspective, we do know what to do.
The onset of short-termism
Another Gartner report, issued in the earlier wave of the pandemic, warned CFOs against short-term and unsustainable cost cutting measures, and understandably so – knee-jerk financial decisions can have devastating longer-term consequences in terms of everything from supply chain security to the retention of valued talent.
However, for many organisations – particularly those without the luxury of healthy cash reserves – it very quickly became about survival. So yes, finance leaders may have been forced to take some rapid actions they would have rather not, but in most cases the decisions will not have been made recklessly. They will still have been considered, albeit at pace.
This agility is an important trait for finance professionals – crisis or no crisis. As a private equity CFO – my former role – the fluidity of decision making reflected the speed with which stakeholders wanted to drive up the value of the business and realise an ROI as quickly as possible. Here aggressive targets may have been the pressure points – not a global pandemic – but the need to act fast and think about a comparatively more short-term outlook, was key.
Moving the dial
For businesses that are a going concern, the objectives are very different to those associated with the PE model. So, the challenge for CFOs in these environments, is to regain a longer-term outlook, ASAP.
Admittedly this isn’t easy amidst so much economic turbulence, and some companies, sadly, are having to manage cash on a daily basis just to ensure staff get paid. But we know that pure short-termism can jeopardise the future financial integrity of businesses, while stifling innovation in the process.
At Bailie Group, for example, the purpose of our organisation is to invest in ideas and people which make a positive difference, and properties that inspire. We therefore have some bold ambitions – not to mention a sharp monthly reporting rigour – and we’re continually growing, both organically and via acquisition. But we naturally have a longer horizon too, which cannot – and will not – fall by the wayside because of Covid. The board needs to support the company, the people within it, and society, far into the future.
Looking inwardly to develop long-term plans
To do this, last March was all about looking inwardly to check that we were OK. We temporarily paused a commercial property overhaul for example, and some due diligence work on an impending acquisition also took a momentary back seat while we ensured our ‘house was in order’. Thankfully, in our case, we have a robust management structure and strong cash reserves from previous years’ reinvestment, so our position was stable. But this evaluation exercise was important nonetheless as we certainly didn’t have ‘global pandemic’ on our risk register.
We formed a Covid-19 committee who met every day to make rapid decisions, under pressure, for the benefit of the business, our people, and clients. But we were quick to look outwardly again – after only 1-2 months – to begin focusing on the medium term.
The pace with which this shift can take place will naturally vary from one organisation to the next, and it would be wrong to suggest it’s easy. But the most important point to note is that the adjustment is almost always essential, as soon as practicably possible, and it’s never too late to turn the dial.
Nurturing a vision
Personally, 2020 was less about long-term planning for Bailie Group, as we were already in the final year of a three-year plan. We’re fortunate, in that respect, to have previously had that vision, not to mention an operating model which doesn’t bog decision makers down in tactical constraints.
But even without these fortunate elements, and however prolonged this period of difficulty may feel, finance executives and their senior management teams can still be visionary.
Presuming organisations have taken advantage of all funding currently available, and undertaken sensible cost reviews to remove unnecessary spend, the next key action is to devise a plan inclusive of clear milestones, roles and responsibilities, to bring it to life. Love or loathe the term ‘pivot’, it is evidence that lateral thinking can ignite previously untapped revenue streams, and some businesses may be yet to fully realise their potential here.
We’re about to currently formalise our new three-year plan – purely because we’re at that part in our strategic cycle, not because of Covid. And while our tactical goals for the next 12 months naturally reflect the current climate, our purpose remains true, and so our strategy is largely unchanged as a result. We’re going to push boundaries and drive more positive change in our communities, because that’s why we exist. We’re still looking out for additional acquisition opportunities, having completed on one in October 2020, and we have recently announced a substantial innovation fund to ignite the fire in the bellies of our progressive Group companies.
We’ve earmarked investment for wellbeing too, as the health of our people will prove crucial to our longer-term success, and training and development is currently in sharp focus. We’re keen to ensure our colleagues feel engaged, fulfilled and supported now, in readiness for us returning to some degree of BAU, in the future. In fact, this has been an essential part of our budget setting.
We also feel prepared, which is important. Nobody can say with any real certainty what the future holds for the economy. If confidence starts to build, particularly in H2, we will see GDP rise and market opportunities open up once again. We have to maintain that optimism, but we’re continually looking outwardly for cues that influence our ongoing decision making, and advice from peers who also want British business to succeed.
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