A system and method for preventing personal identity theft when making online and offline purchases requires a Purchaser to first subscribe and become a Member user by registering, providing relevant personal identity information, and establishing two-way multi-factor authentication information for security purposes. The ID protection system obtains a controlled use card (CUC) through a CUC issuer on behalf of the Member for use in making each purchase transaction. The CUC is anonymous with respect to user (Member) identity and may be a purchase-specific single-use card or a multi-purpose card with no traceable connection to any other financial account. When the Member makes a secure purchase, the Merchant is presented with anonymous information, except in instances where the Member's real identity information is required (e.g. airline tickets).