You can prevent identity theft! 

Identity theft is big business.  So is preventing identity theft.  While the number of complaints dropped slightly in 2006 from 2005, the total dollars stolen in 2006 exploded to over $1.1 BILLION from 683 million in 2005.  That is an increase of 62%.  And the scams are becoming far more sophisticated.

Chinese bank caught hosting phishing sites!

So what is the federal government doing to prevent identity theft?  In 1998, Congress enacted the Identity Theft and Assumption Deterrence Act directing the Federal Trade Commission to establish the federal government’s central repository for identity theft complaints and to provide victim assistance and consumer education. Specifically, Congress directed the Commission to establish procedures to:

• Log the receipt of complaints by victims of identity theft
• Provide identity theft victims with informational materials
• Refer complaints to appropriate entities, including the major national consumer reporting agencies and law enforcement agencies 

Big deal.  Count the number of identity theft victims, give them a pamphet and tell them who to call.  Personally, I don't believe the government will ever take effective action to help individuals prevent identity theft.  Banks make too much money with pre-approved credit offers and no business wants to take on the responsibility of verifying you are who you say you are!

State governments, however, appear to be providing solutions.  California, Connecticut, Maine and New Jersey have enacted laws that allow an individual to place a security freeze on their credit reports.  At least 20 other states are considering similiar legislation.

A security freeze works by contacting the credit reporting agencies and placing a 'freeze' on the issuance of additional credit.  If someone attempts to open additonal credit, the business will contact the credit bureau and be told that a freeze exists, thus denying credit. 

If you (note the emphasis on 'you') want to apply for credit such as a mortgage or car loan, you would contact the credit bureau and pay a nominal fee to have the freeze removed.  You can put the freeze back on at no charge.