As many as 10 million Americans have their identity stolen each year, according to the Federal Trade Commission (FTC). Identity theft is a silent crime that can go undiscovered for months, and unfortunately it doesn’t take a genius to perpetrate identity theft.
Identity theft takes many forms, but the ultimate goal is to profit financially by using your personal information. According to Privacy Rights Clearinghouse, there are two main ways an identity is “stolen.” The first, “account takeover,” is when a thief acquires your existing credit account information and then makes purchases using either your actual credit card or simply your account number and expiration date.
The second is “application fraud,” where the thief uses your social security number and other identifying information to open new accounts in your name. Monthly account statements are mailed to an address used by the thief, so you may not know these new accounts are open until they default and appear on your credit report.
Here are some of the ways identity thieves operate:
* They call your credit card company and, pretending to be you, they change the mailing address on your account. Then they run up charges on your account, but because your bills are being sent to the new address, it takes some time before the problem is noticed.
* They open a new credit card account, using your name, date of birth and Social Security number. They obtain the information by stealing your wallet or purse, or your mail or discarded paperwork, including your bank and credit card statements and offers. They may also buy your personal information from “inside” sources such as a store clerk or from information you share over the Internet.
* They set up phone or wireless service in your name and make telephone calls.
* They open a bank account in your name and write bad checks on the account.
* They file for bankruptcy under your name to avoid paying debts they’ve incurred under your name, or to avoid eviction.
* They use counterfeit checks or debit cards, and drain your bank account.
* They buy cars by taking out auto loans in your name.
* They get a driver’s license or official ID card issued with your name and their picture.
* They open a utilities account using your name.
* They get a job using your Social Security number.
* They use your Social Security number and name to receive federal benefits.
* They rent property or get medical care using your name.
* They give your personal information to police during an arrest. When they do not show up in court, a warrant is issued for you.
If your credit card has been buying luxury goods for someone you don’t know, you won’t have to foot the bill. You’re personally liable for credit card fraud only up to $50. But if past-due and defaulted accounts that you never knew about make their way to your credit report, your damaged credit is the real problem, and you’ll have to spend time getting your that corrected.
Just who are these people stealing personal information? Most often they are strangers who have never met you; occasionally they are family members. And they are segments of population who are always looking for a quick scam — meth addicts and the mafia included.