Financial Identity Theft

Financial identity theft is the catchall term for all the different ways your identity can be used by another with an end result of his financial gain and your loss. Other forms of identity theft, e.g. criminal or medical identity theft may have secondary financial benefits, but in financial identity theft, the primary purpose of its performance is financial gain.

One of the most commonly occurring types of financial identity theft is credit card fraud. In its mildest form, this is the use of an existing credit card account by someone else posing as you. Shopping by phone or the internet is the easiest way for criminals to use stolen credit account information, because there is no way for identity to be confirmed, so the criminal never needs to be in possession of the card.

Of course, if the card has been lost or stolen, so much the better. Actually having the card in his or her possession opens up a world of new purchasing opportunities for the thief.

New account financial identity theft is only slightly more difficult to perform. To open a new account in your name, the thief has to have a lot of your personal information—full name, Social Security number, date of birth, etc. Of course, that information can be easily obtained by dumpster diving, purse snatching, or mail theft. After that, new cars, utilities--even new homes or businesses--become available to the thief.

Rather than reaching into your mailbox, another way criminals obtain information is by re-routing your mail to a new address. This can be done online, with no identification required. Once your mail is delivered to the new address, the thief has all the information he needs to open new accounts or takeover your existing accounts. And because you never see the bills, you remain unaware of the identity theft.

There are lots of ways your identity can be stolen—if you’re not careful. In fact, if you haven’t been checking your credit reports regularly, how do you know it hasn’t already?