Final answer:
Sir William James Herschel was the first to use fingerprints for identification in contract fraud and pension distributions as a means to prevent impersonation and fraud.
Step-by-step explanation:
The individual credited with being the first to use fingerprints as a means of individual identification for contract fraud and pension distributions was Sir William James Herschel. Herschel was a British civil servant in India during the 1850s and 1860s, and he required local residents to put their fingerprints on contracts as a way to combat fraudulent practices. This effectively reduced instances of impersonation and fraud. Herschel's use of fingerprints was based on the knowledge that no two individuals have identical fingerprints, making it an effective tool for identifying persons.