Identity Fraud and Consumer Theft

Preventing ID Theft in Businesses

Poor practices in business can lead to identity theft


Identity theft is a serious crime that is getting more and more costly each year. Losses due to identity theft are estimated to be in the billions of dollars, with the latest studies showing losses at approximately fifty-six and a half billion dollars. Businesses and their ways of gathering information can be leading to identity theft. Companies that require the gathering and storing of person information pertaining to its clients or customers need to take steps to minimize the risk that this information can get into the wrong hands.


If safe handling practices, instead of some of the poor practices that many businesses follow now, are instituted, much of this personal information can stay out of the hands of identity thieves. However, if security is lacking and the practices being used are sloppy, a company opens itself up to lawsuits, fines…and worst of all, loss of clients and customers.


Some safety practices that a company can put into place to help stop identity theft are:

  1. Make sure that you have a strong, valid reason for collecting the personal information from a customer or client. If it is an extra piece of information that is not technically needed for a transaction, don’t collect it. Also, make sure you are having employees gather that information in a safe manner. If it can be seen by a passerby, or they can be overheard over the walls of their cubicle, that is not a safe environment to be collecting personal information.
  2. Storage of information should be made safe by security systems. There should also be security programs on the computers storing personal data.
  3. Access to personal information should be limited to those who really “need to know” the information. All areas where personal data is stored should have limited access by certain personnel, with password protection on computer systems.
  4. As a rule, all personal information that is disposed of should be unreadable! You need to think of disposal when you collect personal data, as your business certainly won’t need it forever. Where is your dumpster located? Do you shred all documents thrown away? Dumpsters of all kinds that hold intact documents containing personal information are treasure chests for those who are planning an identity theft.
  5. Personnel working at your business should have regular background checks. Mailroom staff, cleaning personnel, clerical workers and computer techs name just a few employees that have access to a wealth of client’s personal information.

No business can stop identity theft from happening in every instance. Using the above safety measure will make it much more difficult for an identity theft to occur, though.