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Identity Theft

Most people know what identity theft is by now. According to the law, it is the appropriation of an individual’s personal information (social insurance number, bank account information, address, etc.) with intent to commit fraud by impersonating the victim. Most people also know (or should by now!) how to protect themselves against identity theft. Yet the problem still occurs, prompting a few recent studies that have discovered some very interesting findings and angles on the issue. Surprising News According to results of a study published earlier this year by the Council of Better Business Bureaus, the leading cause of identity theft is a lost wallet or checkbook, not the much-vilified Internet! In fact, only 11.6 % of the identity theft cases in the study were enabled by computer crimes. The nasty surprise is that in many cases the perpetrator is known, and in half of these cases, that perpetrator is a friend, family member or an employee of the victim. According to the statistic, a co-worker of yours is much less likely to commit that fraud (4% of cases) than a relative of yours (32%)! Employees who have access to personal data stored on company systems are a “healthy” cause of concern as well (13%). The good news is that overall, identity theft is not growing in the US. The number of victims has actually dropped from 10.1 million in 2003 to 9.3 million in 2004, with the median value of the fraud remaining constant at $750. In the US, most crimes are self-detected by the victims, with the vast majority of detection happening while reviewing paper documents and bills. Identity fraud has flourished in other areas, however, such as the UK, Southeastern Asia and Eastern Europe. It is believed that the practice of Information Technology outsourcing to Southeast Asia and Eastern Europe in recent years is linked to the expansion of this type of fraud. Deep Roots It would be easy to solely blame identity theft on computers, on-line business and poor e-commerce practices. Yet our culture of instant-gratification is at the root cause of the problem. It works like this: consumers’ minds are pumped by marketing techniques that make them want to buy whichever latest and greatest car or electronic appliance is on the market. Credit needs to be made readily available to make these sales happen. With just a magical number (social security will do) and an address, a hurried and untrained store clerk will be happy to afford the credit in a matter of minutes – not enough time for a thorough check. This fast turnaround makes it easy for an impersonator to be a successful credit applicant and get the goods based upon an identity scam. Correct credit checks need the proper training and time allowed to confirm that an applicant is indeed who they say they are. Credit card information, a driver’s license, social insurance number, an employer’s address, and a reference who can be contacted to verify identity are becoming much more common now. What To Do People need to take measures to protect themselves against identity theft. These measures range from common sense to becoming more savvy with technology. Do not make your personal information readily available. To do this: avoid giving away more than is evidently necessary to do business; shred or destroy unneeded documents carrying personal information so that they cannot fall into the wrong hands; check your invoices, bank statements and credit rating regularly. Do use updated anti-spy protection, firewalls and encryption when doing business over the Internet, protect your passwords and change them frequently. Don’t fall into the “phishing” net by never responding to emails that ask for personal information and passwords, and retype a website address rather than clicking the link sent to you. Awareness, education and prevention will keep your identity protected, and avoid the consequences of compromised credit rating, financial loss, wasted time and aggravation that occur due to having your identity stolen.