Scam Alert: Expect an upsurge in identity theft as the economy weakens

A new report out this week highlights the danger of identity theft - for all of us. The number of identity theft cases increased 22 percent in 2008, affecting nearly 10 million Americans.

Javelin Strategy and Research has been conducting the identity-theft study for the past five years. The most recent statistics show people are doing a better job detecting and responding to fraud more quickly.

Identity theft cost the victim about $496 per incident - down from $718, a 31 percent drop, from a year earlier. Don't brush that number off. According to the study, the identity thief is making off with nearly $5,000 per case. So, follow my train of thought: There's quite a difference between the direct cash out of the victim's pocket and what the thief is stealing. The banks, credit card companies and businesses are making up the difference and must pass that cost on to all of us. The money comes from somewhere, which makes each and every one of us a victim of identity theft, because we're all sharing in the cost.

I could pass on number after number, but I prefer to focus on what we can learn. If you take nothing away from reading the following words, I most want you to grasp the importance of taking opportunity away from the identity thief.

LESSON ONE: IT'S PROBABLY GOING TO GET WORSE

The economy is a big reason for the increase in identity-theft cases. Since we're not going to snap out of the current economic challenges overnight, expect to see more attempts to steal your personal information.

LESSON TWO: VIGILANCE MEANS LOOKING OVER YOUR SHOULDER

The fraudsters are moving faster. The bad guys and girls are more sophisticated and are putting technology to work. Review your bank and credit card statements looking for the slightest irregularities. Be sure to check your credit reports annually. Shred paper that has identifying information.

LESSON THREE: GENDER MATTERS

This year's Javelin Strategy and Research identity fraud report found that women were 26 percent more likely to be victims of identity fraud than men. Why? Fraud attacks involving women occur more often via in-person channels, such as stores and restaurants, where there is less consumer control. There is a greater percentage of women making in-person purchases, and women were almost three times more likely than men to report their information stolen during an in-person purchase.

LESSON FOUR: LOCK IT UP AND KEEP CLOSE WATCH

Lost or stolen wallets, checkbooks and credit cards are still the most likely sources of identity theft. Online access accounted for only 11 percent of the total fraud.

Don't be scared of identity theft. But don't think it can never happen to you. Be vigilant and protect your identity.