When most of us think of credit fraud, we think of identity theft. While ID theft is one of the most common types of credit fraud, other types of fraud are on the rise--thanks to accessibility of sensitive information online. In addition to stealing credit cards and running up balances, criminals have masterminded a new set of ways to take your personal information and run.
One of the main reasons it's so hard to prosecute identity theft and credit fraud is the lag time between when new accounts are opened and when the crime is discovered. If you don't check your monthly bills carefully, you may not notice additional charges.
Another reason credit fraud and identity theft is on the rise is the variety of ways criminals have discovered how to attain your personal information and credit data. Some common methods used to steal your identity include "dumpster diving," where someone digs through the trash for personal information, copying account information when you're not looking, as well as telephone and internet scams.
To reduce the risk of credit fraud, limit the number of cards you carry in your purse or wallet. Never carry items like your social security card or birth certificate, and take note of changes in your monthly statements. It's also a good idea to shred pre-approved credit card offers instead of just throwing them away. If you suspect credit fraud, report it immediately. Checking your credit regularly or using a credit monitoring service are quite useful in detecting credit fraud.