Why Losing Your Smartphone Could Cause Huge Problems

Your smartphone is probably one of the most useful and entertaining gadgets you own. More than 45.5 million people in the U.S. are now using devices like a Blackberry or an iPhone. Sales of smartphones surged in 2010, nearly doubling in just one year. However, if your phone is lost or stolen, you may pay a terrible price.

The many uses for your cell phone have also created opportunities for thieves to steal your personal information. Your cell phone may actually pose a greater risk of having your identity stolen than your computer.

Obviously, it's much easier for a criminal to steal a phone than a personal computer of laptop, and there could be just as much sensitive data on your phone.

Some applications for smartphones involve mobile banking and can even allow you to deposit checks without visiting the bank. But that means a criminal could find a way to obtain your checking account number and drain your funds. That makes losing a smartphone the new way to lose your wallet.

The research firm TowerGroup reports that nearly 18 million people used some type of mobile banking in 2010. That number is expected to exceed 53 million people by the year 2013. That gives criminals many more targets for identity theft.

The first step toward protecting your identity on your phone is to set up a password. It seems simple, but a web-based consumer group estimates that 67% of smartphone users do not use a password.

Even with a password on your phone, a smart criminal might be able to figure out a way to get inside. A test recently conducted at the University of Pennsylvania found that researchers were able to determine a phone's password simply by examining smudge marks on the touch screen or keypad.

Never leave your cell phone unattended. When phones were stolen in the past, the thief couldn't do much more than make calls with it. Now you're entire life could be turned upside down.

You can also protect your identity by staying off of unsecured public wireless connections - particularly when you are accessing personal information. Avoid downloading applications, games or ringtones from websites that don't seem trustworthy. Experts say that smartphones running on the Android operating system are most susceptible to identity theft attacks.

Finally, remember to delete everything off of your smartphone before you throw it out when you get a new phone.