How To Prevent Identity Theft

Identity Theft and Credit-Card Fraud 101 – An Introduction
This complex subject will require a number of postings. Identity theft and credit-card fraud are opposite side of the same coin, and both are high-growth industries of global scope. This particular post will deal in a broad-brush way with these interconnected topics, and how to handle the fallout of being victimized.

Most Consumers Will Experience Identity Theft Sooner or Later
ID theft has become a fact of life. There are predators out there who seek every possible opportunity to steal critical personal information and put it use opening fraudulent accounts and buying goods and services in your name.

The Identity Theft Process – Obtaining Personal Information
Important bits of personal information can be obtained in a number of places. Wallets get lost, receipts with important information get misplaced, account statements get found in the trash, sensitive conversations are overheard, and hackers break into computers.

A seasoned scam artist can take a single bit of information and build on it. For instance, a name and an address found on a scrap of paper can lead a thief to your home where he or she might steal your mail. A lost wallet with a social security card or a driver’s license in the parking lot of your grocery store can lead a thief to a clerk who might know you and provide a telephone number that can be used in a Phishing scam to extract a credit-card number from an unwary elderly person.

There are thousands of ways for scam artists to assemble a vulnerable identity. They specialize in doing this, and the internet is a valuable source of collateral information once a thief has a starting point. For instance, a birth date can be found to match a social security number by searching the net for public records in which a social security number might have been disclosed. Many legal documents that are public record have this information in them.

Opening Fraudulent Accounts
Once key identity information has been stolen, new credit-card accounts can be opened using almost any personal information. The thief simply creates his or her own passwords and security codes and proceeds the same way any other consumer might. Credit-card issuers are in the business of issuing cards. Their business models have allowances for fraud, so you personal credit history is not their primary concern.

Using Fraudulent Accounts
Internet shopping has made the use of fraudulent credit card easy. A thief logs on to a web site from anywhere – an internet café, say. He or she places an order for expensive clothing or a piece of jewelry and has it sent to an address owned by people known to be on vacation. Signature is waived. The delivery service leaves the package on the doorstep, and the thief drops by to pick it up, remaining anonymous throughout the process.

How To Prevent Identity Theft and Credit-Card Fraud
Identity theft is a shadow crime. When done by a professional, it takes place without the victim being aware of any of the several steps that precede use of a stolen account. The best way to prevent identity theft (aside from protecting your wallet and shredding your account statements) is to monitor your credit report. Watch it like a hawk. Address any strange or unexpected activity immediately.

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