I was recently told a story about identity theft. My friend was sitting in his office in Haliburton one day, and unknown to him, his charge card was being used in Hamilton at a sporting goods store to purchase over $4,500 of sporting goods. He went to Toronto the next day to do some shopping. While shopping, his charge card was suddenly rejected on a purchase. He thought that was strange and so he phoned the charge card company. The charge card company told him that they had already left a phone message in Haliburton asking to verify the large sporting good purchase in Hamilton because it was not the usual pattern of his purchases and raised suspicion. The charge card had reached its limit and so the Toronto purchase was rejected for that reason. Of course, my friend was nowhere near Hamilton the day before.
The charge card company explained to my friend that they regularly monitor patterns of purchase to detect fraud. An unusual purchase pattern raises suspicions. The company said that what probably happened was that, when a normal purchase was made by my friend, and he was not keeping an eye on his card, the store swiped the card a second time using a concealed electronic device (perhaps under the counter) to copy the magnetic strip on the back. A new physical card was then created with the friend’s name and with the magnetic strip. My friend’s identity had been stolen.
The charge card company immediately sent my friend a new card and cancelled the old card. They conducted an investigation and determined it was fraud. My friend was not charged the $4,500. Have you noticed that most stores no longer ask for identity of the person using the charge card? The retail store had to pay the $4,500 because the store had not checked for identity.
If you do not want to be a victim of identity theft, always keep an eye on your charge card when making a purchase. Good advice, but certainly difficult to do in a restaurant, or on the Internet. Be suspicions, as well, of phone calls asking for charge card information.
“Identity theft” is really a new buzzword in the electronic age for good old-fashioned fraud. The forgery of signatures or the impostoring of a person are classic examples of identity theft.