Two watch groups that track identity theft reported that millions of credit card numbers and social security numbers were stolen in 2007.  One group reports that there was a fourfold increase in ID theft in 2007 relative to 2006.

Hackers appear to be one step ahead of the internet security companies, making it difficult to keep yourself safe.  Also, there were a number of instances of stolen laptops that contained sensitive customer data.  To read more about how identity theft is on the rise, please see this report from Fox News.

Our family was recently the victim of a theft of our debit card number.  While reviewing our recent transactions, we noticed that some unauthorized transactions were beginning to appear.  Fortunately, we were able to block our account number before too much damage was done, but there were about 5 or 6 fraudulent charges that came through our account.  The thief ended up sending us some unwelcome packages, which we were able to promptly return. 

Because of this loss, we have committed to no longer use our debit card for online transactions.  If this account number is compromised, the fraudulent charges end up coming out of your checking account, which could lead to a whole slew of bounced checks if you don't have any margin of safety built into your account.  We were fortunate not to bounce any checks, but it could have been a whole lot worse.

Several insurance companies now have riders on homeowners insurance policies that can help to mitigate the risk of loss from identity theft.  There is also a new company, named LifeLock (www.LifeLock.com), that promises to protect your good name for a monthly fee.

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