Question

What is identify theft and why is it so important to understand it? How does identify theft impact businesses and individuals.

Answer 1

Identity theft is stealing someone identity such as social security nu, driving license no etc and use those identities to generate financial advantages such as taking credit, fraud or crime. The person whose identities been theft may suffer losses because ultimately burden and charges of those financial advantages and crime will come on him or her. So this is very important to secure the personal information and identity.

How the identity theft affects the individual I have elaborated in the example now let us understand how it will affect the business.

• The thieves often use the information of the business owner to open new lines of credit. The unpaid purchases are very huge when it comes to business. The company will have to pay all those debt if the owner is not able to prove that his or her data was theft. Due to this dilemma the company may lose its prestige with the vendors.
• They will further hesitate to offer their services to the company.
• The debts may be reported negative in the personal credit report. It means the company will not able to receive big amount of loans as their limits will be reduced. In future of the company wants to expand it so capital will be needed and it will be very difficult to collect the loans from the banks due to poor rating.
• The company may fill increased tax because of the fraud purchase.
• There is a big risk of business failure with the identity theft. The company may lose its prestige in the eye of customers, vendors, suppliers, investors etc.