7 Ways to Protect Your Identity While Shopping

In addition to mounting debts and shrinking budgets, consumers have one more thing to worry about this holiday season: identity theft.

Identity theft typically surges during the holidays as shoppers slap down their plastic more often in stores and make more purchases online. And this holiday season is poised to be especially dangerous, thanks to the struggling economy, credit crunch and a generation of thieves that have grown more tech savvy. "The crooks seem to crawl out from under their rocks during the holidays," says Gail Cunningham, spokeswoman for the National Foundation for Credit Counseling. "And this year, we have the perfect recipe for identity theft."

Among some of the tactics consumers need to watch out for: culprits presenting themselves as debt-management agencies offering to help them get out of debt. Another trick gaining in popularity are credit-card skimmers, which scan and store credit-card information that can then be used to make new credit cards, says Cunningham.

Identity theft is the largest consumer complaint in the country, according to the Federal Trade Commission. In 2007, 32% (roughly 258,000) of consumer complaints filed with the FTC involved identity theft.

Perhaps the worst part about identity theft is that victims often don't know what's happened until substantial damage to their credit score or their savings has been done, says Tom Rusin, president and CEO of Affinion Security Center, a Norwalk, Conn.-based identity theft protection company.

Here are six ways to prevent identity theft from ruining your holidays.

Just like semi-annual teeth cleanings, consumers should make a point to check their credit score on a regular basis -- ideally every three to four months, says Cunningham.

You can get a free credit report every 12 months from each of the major credit bureaus, Equifax, Experian and TransUnion. To request a report, go to annualcreditreport.com. Look for any questionable accounts like a credit card or a car loan that you never signed up for and contact the credit bureaus immediately to report them.

Consumers should be just as vigilant about combing through their monthly credit-card statements. Besides confirming that you weren't accidentally charged twice for a purchase, pay close attention to small credit-card charges. Identity thieves will often charge a very small amount, like $1, to verify that the credit card works, says Rusin.

Ask the credit cards' customer service department to set up an alert to notify you of suspicious charges in the future, says Kristin Loberg, author of "The Personal Security Handbook." These alerts are typically free. When an unusual amount -- be it in quantity of products or value -- is charged to your card over a short period of time, the credit card's fraud department will contact you.

For online shoppers, some credit-card issuers offer single-use credit-card numbers that only work for one online transaction. "If someone was to steal it, they couldn't use it for anything else," says Rob Enderle, principal analyst at the San Jose, Calif-based Enderle Group, a technology consulting firm.

MasterCard (MA) also offers SecureCode, which prompts credit-card holders to input a code -- just like a PIN -- that's only known by the user and the issuer to finalize a purchase at participating retailers.