Identity theft is stealing a victim's personal information to commit a crime such as making fraudulent charges on a credit card. It is one of the nation's fastest growing crimes and it can happen to anyone. The Federal Trade Commission estimates that 27.3 million Americans have been victims of identity theft in the last five years, including 9.91 million people, or 4.6% of the population, in the last year alone. Someone's identity is stolen every 75 seconds.
Identity thieves use a variety of methods to gain access to a victim's personal information. They include: rummaging through trash, stealing wallets and purses containing identification and credit cards, stealing mail, stealing personal information from a victim's home, posing as a business person or government official to scam information, and stealing information from businesses or employer records. Identity theft is typically not a stand-alone crime but, rather, part of a larger criminal act, such as credit card fraud, theft of bank account funds, or cellular phone service fraud. In other words, it is usually the means to a fraudulent end
Internet-related identity theft scams have become increasingly common in recent years. Thieves use e-mail messages to lure victims to Web sites that appear to come from reputable companies such as major retailers. They then trick them into revealing personal information such as credit card, bank account, and Social Security numbers. Identity thieves then use the data to obtain fraudulent credit cards or commit other crimes. The practice of sending e-mail messages with criminal intent has come to be known in the industry as "phishing."
Another recently reported identity theft scam is the misuse of personal data posted on job recruiting Web sites. Scams usually take the form of fraudulent offers of placement assistance or the theft of personal data from job applicants by someone posing as an employer. Business "opportunity" pitches are often illegal pyramid schemes or multi-level marketing programs requiring large cash investments by job hunters.
Identity theft often goes undetected for months, allowing fraudsters the luxury of time to commit their crimes. It takes 14 months, on average, between the time that information is stolen and when a victim discovers the theft. One reason is that fraudsters often use change of address forms or fraudulent addresses to divert a victim's mail (e.g., credit card bills) to another location. Some people discover that their identity has been stolen only after they request a credit report and see new accounts listed that they did not open. Others learn that their identity was stolen when they are contacted by creditors to make payments on unauthorized debts.
A 2003 Federal Trade Commission survey, with a random sample of over 4,000 households, found that 52% of all identity theft victims, or approximately 5 million people last year, discovered they were victims by monitoring their accounts. Another 26%, or approximately 2.5 million people, reported they were alerted to suspicious account activity by companies that they do business with. Eight percent reported that they learned they were victims by being turned down for credit.
Identity theft cannot be prevented entirely but being aware of its causes can reduce the risk of becoming a victim. Two resources for determining your personal risk exposure for identity theft are the Rutgers Cooperative Extension Identity Theft Risk Assessment Quiz at www.rce.rutgers.edu/money/identitytheft and the Privacy Rights Clearinghouse Identity Theft IQ Test at www.privacyrights.org/itrc-quiz1.htm.