Identity Theft: What is Identity Theft?

Posted by on February-2-2009 under Save Money

This is the second article in my series of articles on Identity Theft. Click Here to read the previous article in this series.

As I mentioned in my first article, 9 million Americans are impacted by Identify Theft every year. Awareness is the first step in making sure that you are not one of them. The scary part is that most of the people still do not completely understand what exactly Identity Theft is, and what can be the implications of Identity Theft. So, I thought of writing this article to explain in simple terms what exactly Identity Theft is.

Identity theft occurs when someone uses your personally identifying information, without your permission, to commit fraud or other crimes. The personally identifying information can be anything, ranging from your name, to your social security number, your credit card number, your bank information etc. (Like this article? Click here to be notified via email when similar article is published.)

As might be obvious from above, identity theft does not necessarily means just stealing someone’s social security number, as is the normal perception. It relates to your other personally identifying information as well.

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The implications of someone becoming a victim of identity theft can be huge. The crimes that have been committed after stealing identity encompass almost everything: taking a big loan, opening a credit card, renting an apartment, getting a phone connection, buying a car – all this in someone else’s name! I have a friend whose online banking information was stolen to withdraw money from his account.

FTC website lists following different types of crimes that can be committed using your stolen identity:

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•Thieves may open new credit card accounts in your name. When they use the cards and don’t pay the bills, the delinquent accounts appear on your credit report.
•They may change the billing address on your credit card so that you no longer receive bills, and then run up charges on your account.

Phone or utilities fraud:
•They may open a new phone or wireless account in your name, or run up charges on your existing account.
•They may use your name to get utility services like electricity, heating, or cable TV.

Bank/finance fraud:
•They may create counterfeit checks using your name or account number.
•They may open a bank account in your name and write bad checks.
•They may clone your ATM or debit card and make electronic withdrawals your name, draining your accounts.
•They may take out a loan in your name.

Government documents fraud:
•They may get a driver’s license or official ID card issued in your name but with their picture.
•They may use your name and Social Security number to get government benefits.
•They may file a fraudulent tax return using your information.

Other fraud:
•They may get a job using your Social Security number.
•They may rent a house or get medical services using your name.
•They may give your personal information to police during an arrest. If they don’t show up for their court date, a warrant for arrest is issued in your name. (Like this article? Click here to be notified via email when similar article is published.)

All the above really sounds scary – isn’t it? People have to grapple with identity theft for many days, deal with financial loss, spend money on fixing their identity, deal with lost education and job opportunities, and lot more. In a nutshell, Identity theft can cost you time and money. It can destroy your credit and ruin your good name.

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I hope this article gives you an insight into Identity Theft, and why you should be concerned about it. Click here to read next article in this series to understand how your identity can be stolen.

If you have some thoughts to share with others, or know someone who has been impacted by Identity Theft, then do leave comments.





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