How Does Identity Theft Work?

Identity theft is one of those things that sits in the very far back of our subconscious mind. We don’t consider the everyday things we do or the people we do them in front of, but we need too. Criminals are always one step ahead of their victims; therefore, people should always be mindful of their surroundings. Remember, someone is always watching even when it doesn’t seem like it. Protect personal information at all costs to avoid being another identity fraud victim.

What is identity theft?

Identity theft is the use of someone’s personal information in a fraudulent way; such as a person’s name, social security number, address, birth date and driver’s license number. The goal of stealing someone’s identity usually involves financial gain like: applying for credit cards, loans, or new services (cell phone or utilities). Identity fraud is more common than not and can occur very quickly – in the blink of an eye. Public places are breeding grounds for identity theft. Predators often stalk their prey when it’s least expected; for instance, swiping a card at the checkout counter in the grocery store. “Shoulder riders,” are those perps that study others information from a distance. They can memorize card numbers and pin numbers in a small amount of time. The information they obtain could be used for online store purchases or payment of something over the phone through an automated service. Another convenient place of opportunity for an identity thief enthusiast to take advantage of unknowing victims is a restaurant. Credit card exchange happens between owner and stranger every day without an ill thought in mind. Presumably, if a server was in the business of stealing identities, then a restaurant would be a gold mine. The way technology is set up today, capturing someone else’s information is made quick and easy. All that’s needed is a cell phone and a few quick shots of the front and back of a customer’s credit card. It’s that simple.

How to prevent identity theft?

Unfortunately, almost everyone will be a victim of stolen identity at some point or another in their lives; however, there are ways to minimize personal risk:

  • Social security cards are extremely vital and should be protected at all times. Do not carry social security cards around in purses or wallets. Social security numbers should be kept in a safe place and should not be shared with anyone unless it’s necessary.
  • When shopping or at using ATM, safeguard the keypad so that account numbers and pin numbers are kept confidential.
  • Discard of all pre-approved credit offers received in the mail by ripping up the solicitation before throwing it in the trash. Identity thieves are notorious for going through a person’s trash to collect pertinent information about them.
  • Monitor credit reports often. There are several “free” sites available that will allow a person to check their personal credit report as often as they would like without being charged for the service, or affecting their credit scores. And there are also companies that offer identity theft protection for a nominal fee. They will keep an eye on an individual’s credit profile in case of any illegal activity.
  • Use a shredder or hand-shred any information that contains account numbers, social security numbers, offers of credit, and expired credit cards.
  • Always equip computers with anti-spy software to protect against hackers and viruses.
  • Create a unique, not easily identified password for all online accounts. Change those passwords often and never share them with anyone.
  • Take advantage of websites that offer free annual credit reports from all three credit bureaus. It’s advisable for a person to check their credit annually for any suspicious activity.

How to report identity theft?

If a person becomes a victim of identity theft, he/she should immediately report the incident to the Federal Trade Commission to receive a recovery plan. Once a claim has been filed with the FTC, the victim will receive and ID theft affidavit. The next step is to file a report with the police department. Collectively, the police report and the ID theft affidavit will serve as proof of identity fraud and will be especially useful when contacting creditors. A few other steps necessary to take to thoroughly report identity theft are as follows:

  • All creditors must be contacted and all major credit cards canceled.
  • Make contact with one of three major credit bureau reporting agencies to implement a credit profile freeze. This will make applying for new credit using the victim’s information virtually impossible.
  • Financial institutions need to be made aware that there has been an identity theft. The bank should then update the victim’s information to reflect that a crime was committed. All linking accounts should be canceled and changed, to protect the consumer’s investment with them.