Identity theft, sometimes called identity fraud, refers to the crime where someone wrongfully obtains and uses another person's personal information by fraud - usually to steal money. Internet users are targeted through spam email and phishing - email and sites that trick you into revealing important personal information. Postal Inspectors claim that "Identity theft is America's fastest-growing crime. Last year alone, more than 9.9 million Americans were victims of identity theft, a crime that cost them roughly $5 billion."

A study by The Identity Theft Resource Center in the summer of 2003 found that

• Fraudulent charges now average more than $90,000 per name used
• Nearly 85% of all victims find out about their identity theft case in a negative manner
• The average time spent by victims is about 600 hours
• While victims are finding out about their cases earlier, it is taking far longer now than before to eliminate negative information from credit reports

The Department of Justice recalls one amazing case of theft: "In one notorious case of identity theft, the criminal, a convicted felon, not only incurred more than $100,000 of credit card debt, obtained a federal home loan, and bought homes, motorcycles, and handguns in the victim's name, but called his victim to taunt him ... before filing for bankruptcy, also in the victim's name. While the victim and his wife spent more than four years and more than $15,000 of their own money to restore their credit and reputation, the criminal served a brief sentence for making a false statement to procure a firearm, but made no restitution to his victim for any of the harm he had caused. This case, and others like it, prompted Congress in 1998 to create a new federal offense of identity theft."

You need to take action to protect yourself and your family. You can't rely on the police of FBI to protect you - they can only act after you're a victim. Take some practical steps to protect your family:

• Be suspicious of any email or web site that seems to offer something too good to be true. It probably is. Common sense is your best protection against being taken in. Legitimate companies will be happy to answer any questions - online or by phone before you give them your information. Be very cautious before giving out any personal information.
• Don't click any links in phishing email - email that looks like it is from your bank, credit card company or a company you use online like eBay or PayPal. These emails usually tell you that you need to login to your account immediately to update your information or your account will be suspended or closed. The phisherman wants you to follow the link to his site - which looks just like the legitimate site - and enter your information. Don't. If the request is from a company you do business with, and the request seems reasonable, open your Internet browser and type the site's address into the address bar - don't copy and paste any links. When you're sure you're on the correct site, you can log in to see what information they need. Be very suspicious if the site asks you for personal information they should already have - like your account number. Think before you enter your information - does it make sense the bank has forgotten my account number and address? If anything seems strange, log off and call the company by phone - don't use any phone numbers contained in the original email.
• Install spam blocking software, and spyware removal software. Good spam blocking software can eliminate many of harmful emails before you ever see them. Good software companies keep the database of threats up-to-date (remember to do your part and update the program regularly). You also need spyware removal software to protect you when a phishing message makes it to your inbox. Phishermen are very crafty - and dangerous. Recent phishing attempts have found emails that change the entries in your 'hosts' file on your computer. The hosts file helps direct your browser to the web sites you request. When the phishermen change that file, you can type in the correct web address for your bank or credit card company - and the phisherman has redirected you to his site!
  
  Our favorite programs to block spam are Webroot Spam Shredder (More Info - Purchase) and Track Zapper Software's Anti Spam Filter (Review coming soon - Purchase). Spam Shredder offers a free trial - you can download it here.
  
  Our favorite anti-spyware programs are Webroot Spy Sweeper. Webroot offers a free trial, you can download it here. Another excellent anti-spyware program is and SpyBlocker from SpyBlocker Software. SpyBlocker's price includes lifetime updates.
• Make sure you know who you're dealing with online. If you're shopping at an established site, double check the address in the address window in your browser. Make sure the company's name is right be for the .com (or .net or .org). That identifies he domain. If you think you're shopping at the Nile bookstore with the address of www.nile.com, valid addresses would include www.books.nile.com/somepage.html and www.other.stuff.nile.com. Addresses like www.nile.books44.com/pagename.html where the name just before the .com is not the name of the domain you're looking for are likely to be fake.
• Before dealing with a new company online, you can check with the Better Business Bureau at www.bbb.org.
• Before you enter any personal information, make sure the site is using the correct protocol for transmitting data securely. Most web sites start with a http:// before the domain name. That connection is not secure - there are several places on the Internet where someone can steal your information while it is being sent to the web site. Secure web connections all have https:// before the domain name. Make sure you see that 's' before sending credit card or other personal information.
• Protect all of your username, password and PIN information. Passwords work only if they're secret. Taping them to the front of your computer in the office is a poor way to keep a secret. Don't a unique password for each site you do business with. Change all of your passwords regularly. Don't use something obvious for a password - don't use your kid's and pet's names or birthdays.
• Be very careful responding to email offers that suggest you've won a prize or award from companies you've never heard of. Legitimate prizes and awards do not require you to pay money to receive them. Don't give out any personal information or account numbers. If the organization is Legitimate, you can call them on the phone and ask them to send you a letter explaining what you've won and what you have to do to collect your prize.
• Pay attention to activity in your credit card and bank accounts. Most now let you check activity online. If checking your accounts a couple times each month is too much trouble, at least read the paper statement the banks sends you every month. Make sure there aren't any charges you don't recognize or additional card numbers on the account. If your statement doesn't arrive on time, call your bank. When your credit cards are due to expire, the bank will send you a new card a few months before the old one expires. If that does not arrive, call your bank. Don't wait - call immediately. If nothing is wrong, you've wasted a couple minutes. If you catch a problem before it happens, you've save hundreds or thousands of dollars and many, many hours.
• Check your credit report regularly. Credit reporting companies are required to provide you with a free copy of your report every year (the law requiring free reports takes effect in stages. If you live in CT, DE, ME, MD, MA, NH, NJ, NY, NC, PA, RI, VT, WV and Washington, D.C., companies are not required to give you a report until after September 1, 2005. All other states are covered now.) You can order your credit report through www.AnnualCreditReport.com. The FTC has more information here.
• Report phishing to the proper authorities. Large companies have entire departments to fight phishing attempts using their name. You can probably find that department's address on their site. If not, contact them using their customer support address. Also report the phishing attempt to the Federal Trade Commission. The FTC enters Internet and other fraud-related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies. To file a complaint send a copy of the email to spam@uce.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The FTC in the U.S. and abroad.

What To Do If Your Identity Is Stolen

If you suspect that someone has your personal information, report it now. Don't wait.

• Contact the Federal Trade Commission (FTC) to report the situation. The FTC is responsible for handling complaints from people who believe they may be victims of identity theft. The can provide up-to-date information to contact your financial institutions. Contact the FTC online at www.Consumer.gov/idtheft/ or by phone toll-free at 1-877-ID THEFT (877-438-4338) or TDD at 202-326-2502.
• If there are charges on your credit cards for things you didn't buy, or withdrawals from your bank account, call the financial institution. Their contact information is on the statement they send every month.
• Contact any creditor where your identity or credit information may have been used improperly. This could be a long list - don't forget your store credit cards, phone companies, cable companies any bank that has given you a loan, including home equity loans and mortgages.
• Call the local office of the Postal Inspection Service (find them by calling your local US Post Office) if you suspect that an identity thief has submitted a change-of-address form with the Post Office to redirect your mail, or has used the mail to commit frauds involving your identity.
• Contact the fraud department of the three major credit rating bureaus; Equifax, Experian and TransUnion. The FTC maintains up-to-date information to contact each reporting bureau. Contact the FTC online at www.Consumer.gov/idtheft/ or by phone toll-free at 1-877-ID THEFT (877-438-4338) or TDD at 202-326-2502. www.AnnualCreditReport.com also has contact information.
• Contact the Social Security Administration if you suspect that your Social Security number is being used fraudulently. Call 800-269-0271 to report the fraud, they're likely to refer you to the local SSA office.
• The Internal Revenue ServiceIf you suspect the improper use of identification information in connection with tax violations. Call 1-800-829-0433 to report the violations
• Don't cancel all of you credit cards and accounts. Until you get this all straightened out - several months probably - your credit reports are going to show that you're a bad risk and you won't qualify for new credit cards.

To fully protect yourself from identity theft, you need a spam blocking program and an anti-spyware program. Our favorite spam filters are: Webroot Spam Shredder (More Info - Purchase) and Track Zapper Software's Anti Spam Filter (Review coming soon - Purchase). Spam Shredder offers a free trial - you can download it here.

Our favorite anti-spyware programs are Webroot Spy Sweeper. Webroot offers a free trial, you can download it here. Another excellent anti-spyware program is and SpyBlocker from SpyBlocker Software. SpyBlocker's price includes lifetime updates.