Identity theft is defined as the illegal use of someone else’s personal information in order to obtain money or credit (1). Identity theft is increasingly becoming a problem worldwide. The impact of identity theft can be immense, including but not limited to ruined credit or the loss of thousands of dollars. It may be difficult to discern how your identity was stolen because of the many ways in which identity thieves can steal personal information.
Identity theft can be accomplished in many ways: stealing your wallet or purse, stealing mail containing personal information, information provided over the internet, going through your trash or public trash depositories, posing as someone who needs your personal information, or buying personal information from an inside source (2). Inside sources include anyone who legitimately has access to your personal information and wishes to sell it to identity thieves.
If your identity is stolen you may be held responsible for thousands of dollars in credit card purchases that you never made, or your money may be taken directly from your account. While the immediate impact of these financial losses is readily apparent, worse still is the impact this can have on your credit. Poor credit resulting from identity fraud can bar you from buying a new home or car, or getting a new job. The potential fallout from ruined credit is virtually endless.
The numbers associated with identity theft are truly staggering. A 2003 Federal Trade Commission report estimated identity theft losses to financial institutions at almost $48 billion, this report also showed that 27.3 million Americans have been victims of identity theft in the last five years (1998-2003), including 9.9 million people in 2003 (3). The loss to individuals is reported to be $5 billion (3). This equals a loss of almost $14,000 per day to individuals, and $131,500 per day to businesses.
This begs the question, how do I protect myself from identity theft? The easiest way to protect yourself from this horrific crime is to monitor your bank accounts/statements for anything out of the ordinary, and to check your credit reports frequently (4). There are also companies that offer to protect your identity for a monthly fee. Finally, being aware of how thieves steal your identity is important for protecting your personal information. Do not submit personal information over an unsecured internet connection, shred documents containing personal information, and verify the identity of anyone requesting personal information over the phone or internet.