How to Avoid Identity Theft

Steps to Prevent ID Fraud Could Save Money and Stress

Aug 18, 2009
Carol Finch

Ways to Avoid Identity Theft and Fraud Scams - Photo by Penywise

Identity theft is on the rise. With an increasing number of people targeted by identity fraud schemes it makes sense to try and avoid being caught out by ID scams.

The identity of an individual is worth a lot to fraudsters. The personal and financial data that relates to an individual can give them access to a lot of cash. They can use this data to borrow money and to buy goods. In the long-term the identity theft victim may not be held liable for any costs incurred but they will suffer. They may find, for example, that their lines of credit are cut off overnight and that they have the headache of having to sort the situation out. But, there are some measures that can be taken to avoid identity theft happening in the first place.

How to Avoid Identity Theft

This really is one of those instances where prevention is better than the cure. Many people fall foul of identity theft schemes simply because they are careless or fail to realise that their actions are leaving them open to this kind of scam. This is all about protection and vigilance. For example, it might be advisable to follow these steps:

Don't share sensitive financial data such as passwords and PINs with anybody else.
Never write card PINS down and keep them with the cards to which they apply.
Avoid using the same passwords and PINs for every account/card.
Don't let a rubbish bin give the game away and make sure to shred anything that has name, address and other potentially useful information on it (i.e. bank and card statements and even mailshots offering new accounts and credit cards).
Check bank account and card statements at least once a month to make sure that listed purchases/transactions tally up with those actually made.
Make sure that all financial statements arrive every month - a missed statement could mean that a fraudster has changed the address on an account in the hope you wouldn't notice.
Get into the habit of using free checks on credit reports with referencing agencies to make sure that no suspicious activity is going on (i.e. someone trying to open accounts or borrow money).
Make sure to change all address details (including inclusion on the electoral roll) and to have post forwarded when moving house.
Look out for common credit card fraud scams and other ways of stealing personal data.

How to Deal With Identity Theft and Identity Fraud

Those that spot identity theft issues may need specialist help to clear their name and to get their finances back on track again. This may include:

Telling lenders and financial institutions that an identity theft may have occurred.
On their advice, notifying the Police may also be necessary.
Contacting one or more of the credit reference agencies (Experian, Equifax and CallCredit) - they all have trained personnel who can help explain what needs to be done.
Considering CIFAS Protective Registration - this gives a centralised alert to lenders if further identity theft attempts are made.

Source: Directgov