Identity theft is a serious phenomenon currently rampaging American consumers young and old. In 2008, the Federal Trade Commission conducted a customer complaint survey, and identity theft was pinpointed as the number one consumer grievance for that year. Thirty-six percent of the total complaints received by the government regulatory body last year consisted of this grave misdemeanor.

Out of this current percentage rate, credit card fraud was the most rampant form of ID theft. The regulatory agency also received complaints on government documents and benefits fraud, as well as employment fraud, utility fraud, bank fraud, and loan fraud.

Having an individual's identity stolen is actually simpler than most people would think. Commonly, identity thieves can just simply look over an unsuspecting individual's shoulder to peer at PIN numbers in ATM queues, a technique called “shoulder surfing.” Some crooks are also able to purchase personal information such as social security numbers, mothers' maiden names, dates of birth, and other pertinent data over the Internet, for as low as $49.99. Some thieves choose to steal bills, statements, and other envelopes in mailboxes; others take the route of “dumpster diving,” or rummaging around in garbage piles in the pursuit of prized information. Of course, one of the most obvious way of stealing a person's identity is through pick pocketing. Upon acquiring an individual's personal effects such as a credit card, a social security card, and other identification cards that people most commonly keep in their wallets or purses, these perpetrators can purchase items or acquire services using the original owner's name and charge the information to them. Most of the time, ID theft involves financial transactions, and the monetary cost is at the expense of the original signer of the card. The unwary victims of this misdeed may end up being hounded by bill collectors. If left not taken care of, this unfortunate circumstance may also eventually have negative effects on their credit history.

Unfortunately, there may also be instances where people you may personally know—friends, roommates, even family members—can use the information. According to the National Crime Prevention Council, half of the reported incidents of identity theft are committed by people whom the victims actually know. They may be out to extract revenge against their “target,” and ID theft may very well be their weapon of choice. This may sound too good to be true, but these incidents have actually happened. Minors and the elderly are especially at risk, as both have limited financial capabilities in terms of using credit. What thieves do is steal their Social Security numbers and use the information to acquire credit. There have been reports of some students that actually have had difficulty applying for credit when they were first starting out. Even before they reached the age of eighteen, they have already acquired delinquent accounts under their names, all because a crook was able to use their SSN and run up illegal and unauthorized purchases.

How to keep yourself guarded

An individual needs to be vigilant in protecting their personal information. It also pays to be extra careful especially in dealing with our personal effects.

Credit, debit, and ATM cards

• Make it a habit not to carry too many debit and credit cards in your wallet or purse. If possible, bring only at least one or two credit cards and an ATM card. In fact, debit cards are at a much higher risk of losing the funds in them, since these cards are directly attached to your checking account.

• Do not use debit cards when doing online transactions. Using a credit card may sound like a risky option, but these actually have better protection from fraudulent activity.

• Create a database of all your banking information: credit cards, debit cards, checking account information, ATM cards, and the like. Obtain copies of their account numbers, expiration dates, security codes, PIN numbers, and the contact information of their respective providers. Keep a copy of this database in a safe and secure place. Of course, make sure that you can also remember where you keep it.

• You may also prevent possible ID theft by never disclosing personal information by telephone, mail, or the Internet. As much as possible, you can only do so if you have been speaking with a trusted company such as your bank or credit card provider, and if you yourself initiated the call. One of the identity thieves' modus operandi is by calling unsuspecting individuals, claiming that they have won a contest and verifying information such as their SSN, date of birth, and other sensitive data.

• Always disallow bank representatives to write your credit card number on your checks. This is actually a violation in the state of California, as well as in many other states. You may want to check your local state law if the same applies in your area.

• Make it a habit to keep copies of all your receipts. Create a filing system for all your transactions. If possible, arrange them by provider and by date. This way you may keep track of your financial goings-on and expenses.

• Secure copies of your credit reports from each of the three major credit bureaus—Experian, Equifax, and Transunion. By federal law they are required to release a free copy of your report each year. Compare and contrast items on each of the documents that you've received. You may also compare them against the copies of the receipts that you've kept (see above). When you notice any questionable transactions—such as items that you've never charged on a specific date, for example—make sure to contact your creditor immediately to dispute the charges.

• If you live in Colorado, Maine, Massachusetts, Maryland, New Jersey, Vermont, and Georgia, you are entitled to receive another free copy of your credit report, as per state law. That means you can acquire more than one copy of your report in a year. Doing so can greatly help you stay on top of your credit activity and be better able to track your progress.

Taking care of your passwords and PIN's

• Ensure that your passwords and PIN's are not easy to decipher, such as dates of birth, Social Security numbers, mother's maiden names, and the like. As much as possible, try to create a password that is alphanumeric and at the same time easy to remember. You may also need to change the password periodically.

• Memorize all your passwords and PIN's. Never keep a copy of them in your wallet or purse. That would just be extra bait for the thief and grant them instant access to your credit cards.

• You may request for your financial institutions to add extra security on your accounts. Much in the same way that applying for an email address requires a security question, your bank or credit card provider can also provide an additional code or password for added protection. If you are asked to create a security question, make sure that it is answerable only by you.

Social security numbers

• Your social security number is more important than you would think. It permits access to all your banking information, and as such, is the primary target for all identity thieves. Protecting it should be top priority.

• Never allow merchants to write or print your SSN on your checks. Likewise, you may also request your bank not to send your new checks to your home; simply pick them up at the bank yourseld.

• Never give out your Social Security number to anyone unless it is absolutely necessary. Employers and banks may need this information for wage and tax reporting purposes. Potential lenders and other businesses may also need to obtain this information to do credit checks, especially if you are in need of a loan, are signing up for utilities, and are renting an apartment. If someone is requesting for your SSN, probe for information as to why they need to obtain the data. Ask why they need the information, and if any other alternatives would suffice in the event that you do not permit to share it. Once you receive satisfactory answers from the individual, you may gauge whether or not to provide them with the needed information. At the end of the day, the decision is yours; don't allow them to bully you into sharing it with them.

• By federal law, local state motor vehicles departments are not permitted to use Social Security numbers as substitute drivers license numbers. In this light, you may request that your older driver's license would be renewed even if it's way beyond the actual renewal date.

Internet security

• In order to prevent internet hackers from obtaining information directly from your computer files, you need to install a firewall on your computer, especially if your Internet connection is via a cable modem or DSL. This also ensures added security on your personal data.

• Make sure to install an anti-virus not only to protect your computer from crashing, but to prevent potential ID theft as well. There are actually viruses that enable computers to give out information.

• To safeguard against your credit card number being stolen, make purchases from companies with secured portals. Usually, secured websites include an “s” in their website addresses, as in “https://.” Secured websites may also include SSL, or Secure Socket Layer, in the website's privacy statement. Also, take time to find out if the same companies have a strong and secure privacy policy. Likewise, read the latter carefully.

• Never share your personal and financial information over the Internet. If you are able to discover that someone has used or posted your information online, demand that it would be removed immediately.

• Avoid responding to “phising” emails. Usually, these emails claim to be from your bank or other financial institution. A phishing email works by emailing an unwitting consumer of special promotions and offers, and typically includes a link for their website, where you'll be asked for your personal information. This scheme is actually one way for an identity theft to obtain your information. In fact, legitimate financial institutions will never email their customers asking for personal data.

Securing personal data

• You may want to consider online bill-paying services to take care of your bills, or arrange for your bank to set up an automatic withdrawal from your checking account on a certain date to pay for certain expenses. While these services may seem to be risky in terms of security, you need to do some research on which company has a highly guarded portal. Opting for this alternative prevents mail theft, as less statements and bills would be mailed to your home.

• Regularly review all your bills, statements, and credit reports for any fraudulent activity. Immediately contact your creditor if you see any questionable information notated on these documents.

• Using a gel pen to write checks can actually prevent identity theft. A little chemistry lesson here: according to experts, gel ink contains particles of color that get trapped in paper, which makes the task of check washing, or erasing details from checks to enable them to be written, all the more difficult.

• Keep records of your cancelled checks in a safe place.

• Invest in a paper shredder. Instead of just crumpling deposit slips, bank documents, statements, and other pertinent papers and throwing them in the wastebasket, use a paper shredder to dispose of these items. Thieves also rummage through garbage to obtain data.

• You may also want to request certain financial institutions to include you in their “Do Not Call” list.