What Is Identity Theft and How Does It Occur?

by Lynnette Khalfani-Cox, The Money Coach on January 11, 2010

in Credit Cards, Credit Scores, Identity Theft, Insurance, Scams


These days, everyone should be on guard against identity theft, which is the fastest-growing white collar crime in the United States. Identity theft occurs when someone steals your personal information, such as your social security card or driver’s license, then uses that data to make purchases, open accounts, or obtain credit under your name.

Unfortunately, identity theft affects up to 10 million Americans each year, as crooks get increasingly sophisticated and more determined in their efforts to target new victims. Some identity thieves use online “phishing” scams to get you to divulge private information; but others use decidedly low-tech methods like stealing your wallet or “dumpster diving” to obtain credit card numbers and other information about you. An identity thief can be a total stranger – or a family member or friend you know and love.

How to Fight Back Against Identity Theft

No matter who the identity thief is, or what tactics they use, rest assured that these con artists don’t have full run of the house. There are ways you can fight back to protect your identity, maintain your credit rating and keep your finances intact.


Specifically, you can use five primary tactics to help deter, detect or minimize the impact of identity theft:

  • Monitor your credit regularly
  • Take preventative safety measures to avoid ID theft
  • Use fraud alerts
  • Initiate a credit freeze
  • Consider buying ID theft insurance

By carefully managing your credit, and safeguarding your personal finances, you can help thwart would-be identity thieves before they strike.


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Lynnette Khalfani-Cox, The Money Coach

Personal Finance Expert and Co-Founder at Ask The Money Coach.com
Lynnette Khalfani-Cox, The Money Coach is a personal finance expert, speaker, and author of numerous books on personal finance. She appears frequently as an expert commentator on television, radio and in print.

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