The UK's Information Commissioner has found what it describes as a "horrifying" number of companies, government departments and other public bodies in breach of data protection rules in the past year.
Eager impostors? You can protect yourself from identity theft
Such breaches can increase the likelihood of identity theft.
Here's how you can lessen your chances of becoming a victim of identity fraudsters.
How bad is identity fraud?
Looking after your identity has become increasingly important.
The government estimates it is costing the UK £1.7bn a year.
Fraudsters can use personal details to gain access to bank accounts, run up bills, launder money, create false documents such as passports or birth certificates and carry out benefit fraud.
The consequences can be very distressing and a headache for victims to sort out.
While you will not normally be liable for the stolen money, credit reference agency Equifax estimates it can take up to 300 hours to resolve one case.
How can I safeguard my personal documents?
Although the rise of ID fraud is very alarming, there are steps you can take to try to protect yourself.
You have a good credit history but are turned down because of a default on your record
There are entries on your credit file you do not recognise
You are being chased for outstanding debt
Mail you normally expect from financial institutions does not arrive
You have lost or had important documents stolen
You apply for benefits and are told you are already claiming, when you are not
*Source: Home Office
Carelessly discarding personal details is an easy way to become a victim.
Criminal gangs have been known to employ homeless people to search through rubbish bins for financial records and identity documents.
The number one tip from experts is that all documents containing personal information and financial transactions should be either ripped up or shredded before they are thrown out.
Destroying evidence should also extend to direct mailings or any documentation that contains your name and address, experts advise.
Electric shredders can be purchased for as little as £15 and can help take some of the hassle out of destroying documents.
What about documents I want to keep?
Experts advise people to lock away all important documents and financial records.
The most valuable paperwork, such as title deeds and share certificates should either be kept in a safe or at your bank or solicitor's offices.
My bank has sent me an e-mail, asking to update security details - what should I do?
Identity fraud is not only committed using stolen paper documents, it also operates over the internet.
If you receive an e-mail purporting to be from your bank or credit card provider which asks you to update your details, it is likely to be a "phishing" scam.
If customers fall for the scam, the fraudsters can gain access to their bank accounts or use them to launder money.
COMPUTER SECURITY TIPS
Make sure you have a good anti-virus software which regularly runs scanning programmes for spy ware, a personal firewall and a spam filter
Never keep passwords stored on your computer, or disclose them to anybody
If you are accessing banking details from a computer that is used by other people, ensure you do not click on "save" password, as another user could gain access
Check your bank statements and receipts carefully to ensure there are no fraudulent transactions
It is important to remember that your bank will never ask for your log in and password by e-mail.
If in doubt, call the bank.
My bank has telephoned me at home and asked for my pin - can I divulge it?
Cold calling to gain access to bank account details is another tactic employed by identity fraudsters.
But a genuine bank would never call you and ask for your pin number or password.
Are there any special steps I should take when I move home?
Yes. Moving home can be an opportune moment for potential fraudsters.
People are advised to notify all firms that send mailings of their change of address.
Experts also suggest people should redirect their mail to the new address for one year. This should cut down the chances of it being intercepted by potential fraudsters.
People who suspect their mail may have been stolen, can contact the Royal Mail on 08457 740740.
The Royal Mail also offers a free change of address service for nearly 1,000 companies, from banks, gas, water, and electricity suppliers to government agencies.
One way of cutting down on unsolicited mail and the chances of fraudsters using information contained in these mailings is to register with the Mailing Preference Service (see link on right).
How can I keep my passwords safe?
Experts urge people not to write down their pin numbers and not to disclose them to anyone.
They also suggest people should steer clear of using obvious passwords, such as a mother's maiden name or date of birth.
How can I check to see if someone has obtained credit using my identity?
Anti-fraud experts urge people to check their bank statements as soon as they arrive.
Email scams are commonplace
People who are concerned about whether they have been a victim of identity fraud can also check their credit file to see if someone has used their identity to access credit.
You can obtain a copy of your personal credit file for £2 from one of the three credit reference agencies - Equifax, Experian and Callcredit (see links on right).
What if I am a victim?
Act quickly and notify the credit provider straight away. It is also important to report it as a crime to the police and request a crime number.
Industry body Cifas advises victims to keep a record of everything, as recovering from identity theft can be a long and complicated process.
Cifas also advises all letters should be sent by recorded or special delivery and for people to keep track of how much time they spend dealing with the problem.
Victims of identity fraud or people who are concerned they could become a victim because they have had important documents stolen, can apply for extra protection through Cifas' Protective Registration Service.
It costs £11.75 and places a warning on credit files. This should ensure that if anyone applies for credit under your name, further identity checks are made.
This service can also be used to protect the identity of a deceased person. Telephone 0870 0102091 to register.
The material is for general information only and does not constitute investment, tax, legal or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for your own particular situation.