How can someone steal your identity? By co-opting your name, Social Security number, credit card number, or some other piece of your personal information for his or her own use. In short, identity theft occurs when someone appropriates your personal information without your knowledge to commit fraud or theft.
Here are some ways that identity thieves work:
They open a new credit card account, using your name, date of birth, and Social Security number. When they use the credit card and don't pay the bills, the delinquent account is reported on your credit report.
They call your credit card issuer and, pretending to be you, change the mailing address on your credit card account. Because your bills are being sent to the new address, you may not immediately realize that there's a problem.
They establish cellular phone service in your name.
They open a bank account in your name and write bad checks on that account. These schemes may involve changing account information, creating fictitious transactions between unsuspecting parties, or preparing checks drawn on the valid account and that are presented using false identification.
Ways to Prevent ID Theft
Minimize Your Risk
In the course of a busy day, you may write a check at the grocery store, charge tickets to a ball game, rent a car, mail your tax returns, call home on your cell phone, order new checks, or apply for a credit card. Everyday transactions that you may never give a second thought to are an identity thief's bread and butter. Each of these transactions requires the sharing of personal information: your bank account and credit card numbers; your income, Social Security number and name, address, phone numbers, to name a few. While you can't prevent identity theft, you can minimize your risk by managing your personal information wisely.
Catching Identity Theft Early
Sometimes an ID thief can strike even when you've been very careful. One of the best ways to catch identity theft is to regularly check your credit record. Order your credit report from each of the three major credit bureaus each year and make sure all the information is correct. Also, follow up with creditors if your bills do not arrive on time. A missing credit card bill could mean an identity thief has taken over your credit card account and changed your billing address to cover his tracks.
Before revealing personal identifying information, find out how it will be used and if it will be shared with others. Ask if you have a choice about the use of your information: can you choose to have it kept confidential?
Pay close attention to your billing cycles. Follow up with creditors if bills do not arrive on time.
Give your Social Security number only when absolutely necessary. Ask to use other types of identifiers when possible.
Minimize the identification information and the number of cards you carry to what you actually need. If your I.D. or credit cards are lost or stolen, notify the creditors by phone immediately, and call the credit bureaus to ask that a "fraud alert" be placed in your file.
Order a copy of your credit report from the three credit reporting agencies every year. Make sure it's accurate and includes only those activities you've authorized.
Keep items with personal information in a safe place; tear them up or shred when you don't need them anymore. Make sure charge receipts, copies of credit applications, insurance forms, bank checks and statements, expired charge cards, and credit offers you get in the mail are disposed of appropriately. Consider purchasing a shredder.
If You're a Victim of Identity Theft
1, 2, 3 - Do these three things immediately!
Contact the fraud departments of each of the three major credit bureaus (contact information is listed below) and report that your identity has been stolen. Ask that a "fraud alert" be placed on your file and that no new credit be granted without your approval.
For any accounts that have been fraudulently accessed or opened, contact the security departments of the appropriate creditors or financial institutions. Close these accounts. Put passwords (not your mother's maiden name) on any new accounts you open.
File a report with your local police or the police where the identity theft took place. Get a copy of the report in case the bank, credit card company, or others need proof of the crime later on.
Get the big picture - there is help out there:
The Federal Trade Commission (FTC) is the federal clearinghouse for complaints by victims of identity theft. Although the FTC does not have the authority to bring criminal cases, the Commission assists victims of identity theft and other problems that can result in identity theft. The FTC also may refer victim complaints to other appropriate government agencies and private organizations for further action.
If you've been a victim of ID theft, you can file a complaint with the FTC by contacting the FTC's Identity Theft Hotline.
Toll-free 1-877-ID-THEFT (438-4338); TDD: 202-326-2502
Identity Theft Clearinghouse
Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
They also have an online ID theft complaint form, at: