How to Prevent Identity Theft In 1996, Mari Frank lost her identity to an internet hacker when a stranger accessed her credit report online. Ten months later, Frank, of Laguna Niguel, California, had a creditor call him about "her" outstanding debt and it was a lot, a huge lot, including payments for a red convertible that she apparently bought. According to the Privacy Rights Clearinghouse there are over 400,000 thefts of identity each year with that result in more than $2 Billion worth of annual losses for the country. Identity theft is expanding at a rate of 50% per year. Your financial liability is limited to $50. But, your losses will include time and effort to remedy the effects of the theft. They can take out a loan under your name and even get new identification cards with your name but with their picture. They can also go as far as using your name to the police if they get arrested. And in case they do not show up in court during the legal proceedings, a warrant of arrest can be issued on your name and sent to your home for a crime that you have no idea about. Identity theft insurance provides reimbursement for expenses such as phone bills, lost wages, notary and certified mailing costs and sometimes attorney fees with the prior consent of the insurer. Complaints about identity theft have surged from about 40,000 in 1992 to 750,000 in 1998, according to regulators. Most companies and other institutions store information about their clients in databases; if a thief can access that database, he or she can obtain information about many people at once rather than focus on one person at a time. The internet has also made it easier for thieves to sell or trade the information, making it more difficult for law enforcement to identify and apprehend the criminals. And, possibly, one of those identity number social thefts may be tagging along target workplace areas for their misdemeanors. Be vigilant about consistent updates on Credit Annual Reports Thru it, you ll know if there had been a change in the gap and frequency of transactions on loans and utility billings, and its outstanding balances.