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Identity theft happens when someone steals your personal information and uses it without your permission. It’s a serious crime that can wreak havoc with your finances, credit history, and reputation — and can take time, money, and patience to resolve. If identity thieves have your personal information, they can drain your bank account, run up charges on your credit cards, open new utility accounts, or get medical treatment on your health insurance.
FTC site concerning identity theft, with information on how to protect yourself and what to do in case you're a victim of ID theft.