September 7, 2009
-
ID Score; Whoever Heard Of It?, Pt.1
Where does identity theft come from?Identity theft and credit card fraud has become the nation's fastest grown criminal arena. Identity theft occurs when a criminal uses another individual's personal information such as their name, address, drivers' license, date of birth, or Social Security Number (SNN) to secure a job, housing, loans, credit cards, and other products and services. According to the Federal Trade Commission, one out of every six Americans is potential victims of identity theft which leads to credit card fraud. Nearly 10% of the U.S. population became a victim in 2008. They have spent an average of $1,200 and 175 hours resolving problems brought on by identity theft. There are five basic areas of identity theft:
• Department of Motor Vehicles where a thief obtains a drivers license in the credit card holder's name. • Social Security where the thief uses your SSN to obtain employment and you are billed the taxes. Illegal aliens are the biggest offenders in this category. • Medical Information Bureau is the fastest growing where the thief accesses your medical insurance information to obtain benefits and eventually exhausts all your available benefits. • Criminal Identity Theft occurs when a thief gives your identification information to avoid criminal charges against himself. • Financial Identity where a thief uses your financial information to obtain a variety of credit particularly credit cards. They often open up new accounts racked up transactions to the limit and never pay the bill.
Credit reporting companies produce the FICO credit score which represents a credit card customer's creditworthiness and the likelihood that the individual will pay back his debt. The credit score is derived from a number of elements including a payment history and debt ratios. By law, American's have the right to review his credit history free of charge once a year; however, if you want to see your FICO score, you'll need to pay. Reviewing your credit history periodically will help you track if any fraudulent accounts have been opened by identity thieves. There's another score that helps determine the degree to which you are at risk for identity theft; your ID Score.