> Consumer advice  > Identity theft  > About identity theft

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• What is Identity Theft?
• How does it happen?
• Why does it happen?
• How can it be prevented?
• Where can I find out more information?

Identity Theft is now a worldwide problem that has risen dramatically with the electronic age and is costing Australians billions of dollars each year.

Imagine if:

• Thousands of dollars of stereo equipment you didn't buy appeared on your next bank statement?

• Your driver's licence is suspended due to offences you didn't commit?

• A debt collector is demanding payment on a loan you don't have, on a new car you didn't buy?

• Your application for a loan is rejected because you have a history of unpaid bills – which you didn't know about?

If something like this happens to you, then your identity has probably been stolen.

What is Identity Theft?

Identity theft occurs when a thief obtains key pieces of personal information from another person to obtain credit, goods or services in their name or to hide their true identity when they commit more serious crimes. The thief may completely take over existing finance accounts or open new accounts in the name of their victim.

This creates enormous problems trying to undo the damage caused. Not only do the victims spend large amounts of time and resources convincing banks and other financial institutions that they were not responsible, but they also have extreme difficulty in restoring their credit record and their reputation.

When the name stolen is that of a deceased person, the relatives become the victims and can experience severe emotional trauma.

How does it happen?

How often do you give out your credit card number, home address, driver's licence number, Medicare number or date of birth? This is all information that helps identify who you are. If these are ‘stolen', someone else can pretend to be you. You could spend months or years – and thousands of dollars – trying to clear your good name and credit history.

There are many options open to the identity thief. Stealing your purse or wallet is one of them - but it's not their only one.

They could also:

• Raid your letterbox for new credit cards or cheque books

• Sift through your rubbish bin for deposit slips or credit card statements (dumpster diving)

• Look over your shoulder when entering your PIN number at an ATM (shoulder surfing)

• Intercept your credit card details if you shop on a unsecured internet site

• Break into your car and raid your glovebox for your driver's licence or registration notice.

Why does it happen?

Identities are usually stolen to commit some type of fraud. These include:

• To make a financial profit eg opening credit accounts or buying expensive items

• To avoid financial liability eg child maintenance payments, tax avoidance

• To avoid being identified as their original identity eg (disqualified drivers, money launderers, illegal immigrants wishing to stay in the country).

Identity theft is also commonly used in major crimes such as people smuggling, drug trafficking and terrorism. It is one of the fastest growing crimes and many countries are introducing new initiatives and tightening their laws to reduce its increasing incidence. Some of the many cases of both local and international identity theft are documented in Case Studies.

How can it be prevented?

It is important that you are alert to opportunities for others to gain access to your personal information. Some information, such as your birth certificate and passport, is more ‘valuable' than others in proving who you are. For further information visit the Proof of Identity section.

Awareness and reducing access to your personal information are the keys to prevention. Some simple preventative steps are included in the section on How to Protect Yourself.

The South Australian Parliament has passed new laws that will, in early 2004, not only impose harsh penalties for identity theft offences but will also assist the victim to put their credit records back on track. Read about both the current and proposed new laws in the Legislation section.

Where can I find out more information?

The Internet is a valuable source for information about identity theft. Many of these sites are listed on the Links page.

Identity fraud has become a big problem nationwide. In the United States alone it was estimated that there were 7 million victims of identity theft during 2002. If you, or someone you know, becomes a victim of identity theft refer to the information in If it happens to you.

Resources

Links about identity theft

Legislation for identity theft

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