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Combat Identity Theft with Address Verification Services and Other Fraud Protection Tools

No matter what the extent of your financial dealings or the worth of your investments, ensuring that you have protection against credit fraud is an enormous concern in today's electronically-driven world. More than 10 million people per year are victims of some form of identity theft, making it the second-most-reported crime to the federal government in 2003. Federal Bureau of Investigation statistics indicate that identity theft is the fastest-growing crime in the nation. With billions of dollars lost every year, having effective fraud protection techniques in place is essential.

"I think identity theft is something that every payment processor is aware of. Many of the fraud verification tools we use help to thwart identity theft," said CheckGateway.com chief technical officer Brian Bonfiglio. "As a processor, limiting the amount of identity theft helps everyone—our merchants, their customer, us and our banks."

Identity theft is defined as any crime that involves someone wrongfully obtaining and using another person's personal data in any way that involves fraud or deception, typically for economic gain. Financial identity theft is one of three categories of the crime.

A thief can take something as common as a social security number or pre-approved credit card application to wreak havoc on your portfolio. In addition, date of birth, driver's license number, and numbers for credit cards, bank accounts and phone cards can be used to steal your identity. These sources can be used to establish new lines of credit in the form of new credit card accounts, counterfeit checks or debit cards. Thieves can even open a bank account in your name and write bad checks on that account, going on spending sprees that can devastate your finances.

"For us, identity [theft] can put a strain on our relationships with our bank, as well as our merchants," Bonfiglio said. "This is because identity theft increases the level of chargebacks and returns, which in turn, causes our bank to scrutinize us, and then we are forced to shut off merchants."

The Federal Trade Commission reports that most victims don't even know their identity has been stolen until more than a year later. Credit issuers may not have a way to verify the applicant's age and often don't request proof of identity. Also, there is minimal information sharing between institutions. These factors make it imperative that you constantly and diligently monitor the balances of your financial accounts, looking for unexplained charges or withdrawals. Never, ever just assume there's been a mistake—be sure to follow up with the business or institution involved to clear up any discrepancies.

CheckGateway.com offers address verification services and other resources that can provide protection against credit fraud. We specialize in automated clearing house transaction processing for online retailers. Our goal is to provide the largest suite of payment processing services to the business community. Browse our Web site to learn more or call us at 1-480-785-2262, if you require additional assistance.

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