What is identity theft?
Identity theft is a crime in which someone steals your identity by obtaining key pieces of your personal information, such as your credit card, driver's license, social security or other personal identification numbers.
Types of identity theft
"True name": the thief uses your information to open new accounts like credit card and checking accounts.
"Account takeover": the thief uses your information to access your existing accounts. Typically, they will change the mailing address on your account and run up a huge bill before you realize there is a problem.
Identity thieves can trick you into revealing your information or downright steal it using phishing emails, rigged Web sites, Trojans, and spyware or keylogger software.
Identity theft is not confined to the online world and you should also be careful when you're offline. One of the easiest ways for an identity thief to get information is by retrieving personal paperwork and discarded mail from trash dumpsters.
What the police have done
Police across the world have warned that they find it hard to keep up with cybercriminals, as the number of identity theft cases grow and the cases get bigger and bigger:
In February 2011, FBI arrested 74 members and associates of the Armenian Power (AP) gang, for being involved in a variety of crimes including identity theft, bank fraud, credit card skimming and check counterfeiting. They had managed to cause over $2 million in losses after installing skimming devices at cash registers and using the stolen magnetic stripe data to create counterfeit cards.
In November 2010, a California man was arrested under suspicion of hacking into the email and Facebook accounts of over 170 women and in many cases exposing their explicit intimate pictures online.
In August 2010, the Wakulla County, Fla. Sheriff's Office arrested two men for involvement in what's described as "a massive scheme" to defraud thousands of victims across the United States via identity theft. Their alleged scheme involved creating counterfeit credit cards with stolen personal information. The suspects are said to have used the stolen information to purchase gift cards and ship the cards (as well as merchandise purchased with the cards) around the world.
Victims and losses
According to IdentityTheft.info, approximately 15 million United States residents have their identities used fraudulently each year with financial losses totaling upwards of $50 billion. On a case-by-case basis, that means approximately 7% of all adults have their identities misused with each instance resulting in approximately $3,500 in losses.
Also, the average out-of-pocket expense for victims increased 63 percent from, $387 per incident in 2009 to $631 in 2010.
What you can do
Protect your computer against viruses, spyware and keyloggers using updated internet security software.
Don’t share any personal information in response to unsolicited e-mail.
Experts also recommend that you:
• Regularly check your credit report with major credit bureaus
• Follow up with creditors if your bills do not arrive on time
• Destroy unsolicited credit applications
• Shred or burn bank statements or other personal paperwork that you want to get rid of