Identity Theft is a very common crime that occurs when someone uses your personal information without your permission. They use it to commit frauds or any other sort of crimes. No matter how careful you are these smart guys will always find a way to access your private data.
Sometimes they get your information from institutions or businesses by stealing records through the employees of those places and hacking the database of their computers.
Sometimes it is as easy as stealing your mail or going through private homes trash. Moreover, they can simply steal your wallet or purse, or fraudulently pose as current employers and obtain your information first hand.
Financial Institutions with access to your private data have the ethical and legal responsibility of not publishing any of your information, they have to protect it. They must incorporate safety methods that prevent intimate data exposure. Medical institutions must also be very strict with the control and management of your information. The records they handle are protected under the current state and federal HIPPA (Health Insurance Portability and Accountability Act) regulations.
Once the criminals have stolen your information they can do dreadful things with it: they can divert your credit cards to a new address and proceed to charge thousands of dollars in your name, they can establish phone or internet services in your name, develop counterfeit checks and run up your debt through purchases or they can even file bankruptcy in your name to avoid paying the debts they incurred in your name.
If an institution fails to protect your private information there is a liability question for the inappropriate or illegal release of the data. If you have been victim of identity theft and you believe it occurred due to negligence, error or willful act of an institution that holds your personal records you can apply for a possible action class lawsuit.