What is Identity Theft?

Identity theft is when someone uses your personal identifying information to commit fraud or theft, portraying themselves as the victim using the stolen personal information to illegally open various credit card accounts in the victims name.

Identity thieves use the stolen personal information in many ways, including:

They call the victims credit card issuer and, pretend to be the victim, they ask to change the mailing address on the credit card account. The thief will then run up charges on the victims account. Because the victims bills are being sent to the new address, it may take some time before the victim realizes there's a problem.  

They thief opens a new credit card account, using the victims name, date of birth and social security number.

When they thief uses the credit card and does not pay the credit bills, the delinquent account is then reported on the victims credit report. It is generally at this time that the victim discovers that their information has been used fraudulently and the damage caused by the theft is generally just starting to appear.

The thief will establish telecommunication phone or wireless service in the victims name.

The thief will often open a bank account in the victims name and write fraudulent checks on the newly created account.

The thief will occasionally file for bankruptcy under the victims name to avoid paying the debts they incurred using the victims identification. Often, this is done to establish a clean slate for re-establishing credit under the victims identification as well as covering up the original unpaid bankrupt balances.

The thief creates counterfeit checks or debit cards, and will immediately empty the victims bank account balances.

The thief may also buy automobiles by taking out auto loans in the victims name.

The thief  “clones” the victims credit card during a legitimate store transaction and then make fraudulent purchases on the victims credit cards using their personal identity. This new technique is now also being used to steal money from ATM and bank draft cards as well.

Can credit card users completely prevent identity theft from occurring?
In all likeliness credit card users are probably not going to be able to prevent such an occurrence from occurring, especially if a thief is determined to commit the identity theft against a targeted victim. But, credit card holders can greatly minimize their risk potential by diligently managing their personal credit information with great caution and attentiveness.