Identity theft. It can be a consumer’s worst nightmare — someone uses your name, your Social Security number, your credit card number to rack up thousands of dollars in bills, potentially leaving you to pay for a criminal’s spending. Almost as bad, it could take months to straighten out the damage, convincing utilities that it wasn’t really you that started up new service, convincing credit card companies that it wasn’t you who bought that new refrigerator, convincing reporting agencies that it’s not your credit record that should be dinged for unpaid bills.

While identity thieves use multiple tactics to get their hands on your personal information, stealing credit card numbers is a key component of their strategy. Besides the obvious advice to keep your credit cards closely guarded, there is another option you can use to thwart identity thieves — virtual credit cards.

Virtual credit cards are actually virtual credit card numbers — temporary numbers tied to “real” credit cards — which can be used for online or phone purchases, but can not be stolen and used elsewhere by thieves. Virtual credit cards work in slightly different ways depending on the credit card issuer, but the idea is the same. You contact your credit card company and ask for a virtual credit card number.

This temporary number can be used for a single purchase or it might be good for purchases only at a single retailer. Your credit card company treats this number just like your regular credit card number, putting your charges with a virtual number on your regular credit card bill — but the virtual number is useless to thieves, because no further purchases can be made with it.

Citibank and Discover are two of the major credit card issuers that offer virtual credit card numbers. While these and other credit card issuers will rarely charge you more than $50 if your credit card is stolen, virtual credit cards can still be helpful in preventing larger identity theft attempts — it is when a thief puts together many different pieces of your personal information that identity theft becomes so dangerous.

Keeping your credit card number safe can stop a thief from opening utility or other accounts in your name, as credit card numbers are often used as a form of personal identification in these transactions. Virtual credit cards require a bit more effort than simply pulling your card out of your wallet. But, considering the time, energy and money a theft of your identity could cost, they just might be worth it.

Published 12/05/05 (Modified 05/07/12)