Identity theft: What is it and how to avoid it (2022)

Identity theft occurs when someone uses your personal identifying information and pretends to be you in order to commit fraud or to gain other financial benefits.

Your personal identifying information could include your full name, home address, email address, online login and passwords, Social Security number, driver’s license number, passport number, or bank number. Once thieves access this information, they may use it to commit identity theft or sell it on the dark web.

What is identity theft?

Whether an identity thief overhears you reading out your credit card number on the phone, buys your information on the dark web after it has been exposed in a data breach, or steals your information some other way, there are a lot of ways to access your personal details. Using that information is the next phase in the identity-theft process.

Here are some examples of what identity thieves might do with your sensitive personal information.

  • Open new credit cards or other lines of credit using your identifying information.
  • Make unauthorized purchases using your existing credit and debit cards.
  • File a tax return using your Social Security number in order to claim your refund.
  • Use your health insurance to get medical care.
  • Pass an employment background check or rent an apartment, using your identity and financial standing.

Identity theft statistics

There were 1,473 reported data breaches in 2019, according to the Identity Theft Resource Center's End-of-Year 2019 Data Breach Report. That represents a 17 percent increase over 2018.

Some of the biggest breaches in U.S. history occurred in July 2019.

How does identity theft happen?

Identity thieves may access your personal information in different ways. Here are some examples.

(Video) How to Prevent Identity Theft

Phishing

Cybercriminals send fraudulent emails or texts that may look legitimate. The links in these emails or texts may be used to download malicious software — malware, for short. The software may be able to mine your computer for personal information and send it to a remote computer. Cybercriminals uses this information to commit identity theft or sell it on the dark web. It’s a good idea to never open suspicious-looking mails, click on links or download material.

Skimming

Credit card or ATM card skimming happens when criminals replace card readers with a counterfeit device at cash counters or other point-of-sale systems, such as those at grocery stores, coffee shops, gas stations, or ATMs. This device captures data contained in the magnetic strip of credit cards and debit cards and passes it to the skimmer. Sometimes, a small camera is set up to capture entries like ZIP codes and ATM PINs.

With information like credit card or debit card numbers, names, ZIP codes, or ATM PINs, criminals may be able to make fraudulent purchases or withdraw cash in the account holder’s name.

Wi-Fi hacking

Some public Wi-Fi connections are unencrypted. This could give criminals a chance to snoop on data traveling to and from your device. If your device has software vulnerabilities, cybercriminals may be able to inject malware to help them gain access to your data.

Cybercriminals sometimes create fake Wi-Fi hotspots with names that sound like a legitimate network. Identity thieves may be able to view and exploit the information passing through the rogue network. Always check the spelling of the network name before connecting. And take the added precaution of using a VPN to connect to public Wi-Fi, especially if you’re accessing your bank account, making an online purchase, or filing your tax return.

Dumpster diving

Identity thieves may steal mail and patch together your personal information to commit identity theft. They could get important details like bank account numbers, health insurance cards, or credit card details by stealing mail. They might be able to create a new identity if they access key information like your Social Security number.

It’s smart to shred mail before discarding it. Also, shred pre-approved credit card offers, tax-related documents you don’t need, documents that contain credit card numbers or other personal details, or any communication from financial companies.

(Video) Identity Theft Explained - And What To Do About It

Phone scams

Fraudsters may call you on the phone, claiming to be from a bank or theIRS asking for money. If you receive this kind of call, don’t provide any information over the phone. Instead, hang up immediately. Banks and the IRS communicate through the mail. If you are not sure about a phone call, look up the caller’s phone number and call them.

Data breaches

After a data breach, your personal information could be at risk of being sold on the dark web. Sometimes a data breach puts at risk the personal information of millions of people. For instance, the Equifax data breach exposed the personal information of as many as 147 million people.

Malware

Criminals use different techniques to install malware on another person's device. Malware could allow the criminal to access the device and information stored on it. Malware types include viruses, spyware, trojans, keyloggers.

Mail theft

Thieves may sift through your mail in hopes of finding personally identifiable information. For instance, they might find a credit card statement with your account number, a tax form with your Social Security number, or other pieces of info that will help them commit identity theft.

Child ID theft

Identity thieves can use a child's Social Security number to open financial accounts, apply for government benefits, apply for loans, and to apply for an apartment. The person whose identity was stolen might not know about the fraud until they apply for loans or other types of credit as an adult.

Tax ID theft

Tax-related identity theft occurs when someone uses your personal information, such as your Social Security number, to file a tax return to collect your tax refund. You might not know until you try to file your tax return. The IRS will inform you that a tax return has already been filed in your name.

What happens to my information after identity theft?

Identity thieves can profit from your personal information in a variety of ways.

Steal your money or benefits

How identity thieves use your information often depends on what information they have. For example, if they have your credit card number, name, and address, a criminal may be able to make unauthorized charges to your credit card.

With more information, they might be able to file a tax return to steal your tax refund, use your stolen airline miles, receive medical treatment using your health insurance information, or apply for government benefits.

Sell it on the dark web

After a data breach, the exposed information sometimes ends up on the dark web — a part of the internet that isn't indexed by search engines. Social Security numbers usually sell for $1 each, a credit card number goes for up to $110, and a U.S. passport sells for up to $2,000, according to Experian.

Impersonate you

An identity thief could also create fake social media accounts pretending to be you, use your info to pass a job background check or rent an apartment. Fraudsters often target people with a strong credit history and no criminal background.

Possible signs of identity theft

It pays to monitor your banking and credit card statements frequently, along with your credit reports and your mail. Here are some signs of identity theft you can look for.

  1. Your financial statements have discrepancies, or your bank statement shows purchases or withdrawals you didn’t make.
  2. You get calls from credit and debt collectors about charges you didn’t make.
  3. The IRS sends you a letter informing you that more than one tax return was filed in your name.
  4. There are unfamiliar charges on your credit card statement. Sometimes thieves start with small charges around $5 to test that the card will work before making larger purchases.
  5. You receive medical bills for services you didn’t receive.
  6. You don't get bills in the mail. This could mean someone has stolen your data and changed your billing address.
  7. You're turned down for a loan. If you typically have strong credit and expect to be approved for the loan, this could mean an identity thief took out loans in your name and damaged your credit.

How to help protect yourself against identity theft

Here are some easy ways you can protect yourself against identity theft:

(Video) Identity Theft Prevention – Don’t Become a Victim of ID Theft

  • Create unique, complex passwords, for each account and device. A strong password includes a dozen letters, numbers, and symbols. Or you can create a long passphrase, which would be hard for a criminal to guess, but easier for you to remember. Change your password if you suspect the account has been compromised.
  • Enable two-factor authentication on all accounts that offer it.
  • Never give out your personal information — especially on phone calls you didn't initiate.
  • Shred documents before throwing them away. This might include mail, receipts, bills, and any other paperwork that contains sensitive information.
  • Choose paperless billing when possible, so your account information doesn't get sent to your mailbox. You can also opt out of receiving prescreened offers in the mail.
  • Leave your Social Security card, Medicare card, and debit and credit cards in a safe place at home. Only carry what you absolutely need in your wallet.
  • Use websites that are secure. The URL will start with an "https" (the "s" stands for "secure").
  • Check your financial accounts often and keep tabs on your credit reports to look for changes you didn't make.
  • Don't click links, open attachments, or respond to emails from unfamiliar or untrusted sources. These may contain malware.
  • Set up alerts on your banking and credit card accounts. For example, your bank may notify you each time there's a withdrawal from your checking account.

Reporting identity theft

Reporting identity theft can help law enforcement bring criminals to justice and help keep your information safe.

If you've been affected by identity theft, first contact at least one of the three major credit bureaus: TransUnion, Experian, and Equifax. Once you request an initial fraud alert, the credit bureau is legally required to communicate it to the other two bureaus. You may also want to consider freezing your credit reports, which limits access to new credit lines.

Then report the identity theft to the authorities. The Federal Trade Commission’s website, IdentityTheft.gov, can provide you with a personalized recovery plan, guidance, progress tracking, and prefilled forms and letters. You can also report the crime by phone at 877-438-4338.

Also report the identity theft to the FBI's Internet Crime Complaint Center. The Bureau tracks information and distributes it to law enforcement officers who can investigate and search for patterns. This helps the government understand these types of crimes and stop them from happening in the future.

Why do you need identity theft protection?

Identity theft is one of the top consumer complaints, according to the FTC. In recent years, data breaches have compromised personal information of millions of people. That means Social Security numbers, birthdates, addresses, or credit card information could be for sale on the dark web.

Even if you take steps to help protect your personal information, it could be exposed in a data breach. Identity theft isn’t limited to your financial information. Criminals could go after your medical information to commit medical identity theft and use your insurance information to get medical services.

Children can also become victims of child identity theft. Criminals could steal a child's personal data and sell it on the dark web

(Video) What is Identity Theft and How Do You Avoid It?

.It’s a good idea to check your credit report regularly to make sure everything is accurate and correct. You can visit annualcreditreport.com to get a free credit report annually from each of the three major credit bureaus: Equifax, Experian, and TransUnion.

(Video) How to Protect Your Personal and Financial Information from Identity Theft

FAQs

What is identity theft explain? ›

Identity theft occurs when someone steals your personal information and uses it to take your money, open credit accounts, file tax returns, make health insurance claims and more without your consent. Fortunately, there are many things you can do to protect yourself.

How do I protect my identity? ›

How to Prevent Identity Theft
  1. Freeze your credit. ...
  2. Collect mail daily. ...
  3. Review credit card and bank statements regularly. ...
  4. Shred documents containing personal information before disposing of them. ...
  5. Create different passwords for your accounts. ...
  6. Review credit reports annually. ...
  7. Install antivirus software.
22 Aug 2022

How do you know identity theft? ›

How Do I Know if My Identity Has Been Stolen?
  1. Statements or bills for accounts you never opened arriving in the mail.
  2. Statements or bills for legitimate accounts not showing up.
  3. You're unexpectedly denied credit.
  4. Unauthorized bank transactions or withdrawals.
21 Mar 2021

What caused identity theft? ›

Identity theft usually begins when your personal data is exposed through hacking, phishing, data breaches, or other means. Next, a criminal makes use of your exposed information to do something illegal, such as opening an account in your name.

What is the most common method used to steal your identity? ›

The most common way an identity thief can acquire information from a person is from stealing their purse or wallet and an identity thief may take a person's personal information from the internet.

What is a real life example of identity theft? ›

Carlos, vice president for commercial lending at a bank in San Antonio, says he learned he had become a victim to ID theft when he received several unsolicited credit cards in his name and a letter from Sears declining to open a Sears's credit account in his name because he already had a Sears's card.

How do I stop someone opening a bank account in my name? ›

Contact the major credit bureaus

Fraud alerts are free and require companies to verify your identity before opening any new accounts in your name or changing any existing accounts. Another option is to contact each of the credit bureaus to add a credit freeze.

What is the best way to protect your identity online? ›

How can I protect my identity online?
  1. Protect your computer and smartphone with strong, up-to-date security software. ...
  2. Learn to spot spam and scams. ...
  3. Use strong passwords. ...
  4. Monitor your credit scores. ...
  5. Review your credit score. ...
  6. Freeze your credit. ...
  7. Only use reputable websites when making purchases. ...
  8. Stay alert.

How do you lock your Social Security number? ›

If you know your Social Security information has been compromised, you can request to Block Electronic Access. This is done by calling our National 800 number (Toll Free 1-800-772-1213 or at our TTY number at 1-800-325-0778).

How do I know if someone opened a credit card in my name? ›

The best way to find out if someone has opened an account in your name is to pull your own credit reports to check. Note that you'll need to pull your credit reports from all three bureaus — Experian, Equifax and TransUnion — to check for fraud since each report may have different information and reporting.

What are the top 10 ways that thieves steal your identity? ›

Here are the ten ways thieves steal your identity, along with a handful of tips on how to reduce the risk of it happening to you.
  • Credit Card Theft. ...
  • Insecure Websites. ...
  • Phishing. ...
  • Hacking. ...
  • Shoulder Surfing. ...
  • Skimming. ...
  • Fraudulent Credit Reports. ...
  • Pretexting.
4 Sept 2020

Can someone steal your identity with your phone number? ›

Your phone number is an easy access point for scammers and identity thieves. Once they know your number, they can use it to send you phishing texts, trick you into installing malware and spyware, or use social engineering attacks to get you to hand over your personal identifying information (PII).

What are the 5 steps you can take to protect your identity? ›

The Top 10 Ways to Protect Your Identity
  • Use this checklist to protect yourself from identity theft.
  • 1: Keep your mail safe.
  • 2: Read your account statements.
  • 3: Check your credit reports.
  • 4: Shred!
  • 5: Store personal documents at home.
  • 6: Be wary of unknown phone calls and emails.
  • 7: Create difficult logins and passwords.

What are the two forms of identity theft? ›

The three most common types of identity theft are financial, medical and online.
...
Learn how you can prevent them and what to do if they happen to you.
  • Financial identity theft. ...
  • Medical identity theft. ...
  • Online identity theft.

What is the first step in protecting yourself from identity theft? ›

The first and most important step to protecting yourself from ID theft is to ensure that you protect your numbers. These include your Social Security number, any PINs that you have, sensitive passwords, and any type of account number in which you are associated.

Can someone access my bank account with my Social Security number? ›

Someone could try to access your bank account using your Social Security number, but it alone wouldn't be enough. They'd need a lot more personal information than that to get to your finances.

Why would someone open a debit card in my name? ›

This person may be the actual fraudster or someone the criminal has manipulated into acting as a front for the fraud. The accounts are then used to either launder money or commit future fraud. Criminals use stolen credentials and personal data to open accounts in the names of individuals without their knowledge.

Can your identity be stolen from a text message? ›

Scam artists often use email-to-text technology, short codes, or spoofed local numbers to hide their identity. You should contact any bank, government, agency, or company identified in the text message using the information listed in your records.

Where does identity theft usually happen? ›

There are a number of ways identity thieves may obtain your personal information. Fraudsters may dig through mail or trash in search of credit card or bank statements. Unsecured web sites or public Wi-Fi may allow identity thieves to access your information electronically.

What personal information should be kept private? ›

The most sensitive information to protect includes your bank account numbers, social security number, pin numbers, credit card numbers, and passwords.

What can people do with your identity? ›

How identity thieves use PII
  • Open a new credit card or loan.
  • Change a billing address so you will no longer receive the bills.
  • Open new utilities accounts in your name.
  • Obtain a mobile phone.
  • Open a bank account and writing bad checks.
  • Use your debit card number to withdraw funds.
  • Obtain a new driver's license or ID.
1 Sept 2017

What are four methods of stealing a person's identity? ›

Common Tactics Thieves Use To Steal Your Identity
  • Phishing and SMiShing. Phishing involves sending you a fraudulent email that looks to be authentic, say an email from your bank asking you to verify your account information. ...
  • Dumpster Diving. ...
  • Wireless Hacking. ...
  • Fake Lottery Winnings, Jobs, Etc. ...
  • ATM and Payment Machines.

Can someone steal your identity with just your name and address? ›

Can thieves steal identities with only a name and address? In short, the answer is “no.” Which is a good thing, as your name and address are in fact part of the public record. Anyone can get a hold of them. However, because they are public information, they are still tools that identity thieves can use.

What are the 5 most common types of identity theft? ›

Here are five common types of identity theft to help you stay one step ahead of hackers.
  • Financial identity theft.
  • Medical identity theft.
  • Criminal identity theft.
  • Synthetic identity theft.
  • Child identity theft.
15 Jul 2022

What is one step you can take to protect your personal information? ›

Keep private information to yourself.

Never respond to phone calls or emails asking to confirm your Social Security number or account numbers. Don't leave PIN numbers, passwords or other personal information around for others to see.

Do identity thieves get caught? ›

Are identity thieves ever caught? Identity theft statistics for 2020 are not available yet; however, 2006 research showed that federal authorities arrest only 0.14% of the criminals (one person in 700 identity theft suspects). In contrast, nearly 45% of violent crime and 16% of property crime suspects were arrested.

How often does identity theft occur? ›

What are the odds of being a victim of identity theft? Studies have found that 4.5% of people in the US become victims of identity fraud every year. Americans are much more likely to have their identity stolen when compared to other people. One million children also become victims of fraud crimes every year.

Can someone open a bank account in your name without your permission? ›

If anyone, including a spouse, family member, or intimate partner, uses your personal information to open up an account in your name without your permission, this could be considered identify theft.

How do you check if there are bank accounts in your name? ›

If someone else has opened a bank account in your name recently, it should be listed on your credit report. You are entitled to a free copy of your credit report annually from each of the nationwide consumer reporting companies: Equifax, Experian, and TransUnion.

How do I find out what loans are in my name? ›

He said that these days CIBIL score and loan details can be checked online by logging in at the services of any credit bureau such as CIBIL, Equifax, Experian or CRIF High Mark to find out the details of the loans taken against your name.

How do you protect your own and others privacy? ›

How To Protect Your Online Privacy
  1. Commit to sharing less online.
  2. Use strong, unique passwords and two-factor authentication.
  3. Tighten privacy settings for your online accounts.
  4. Purge unused mobile apps and browser extensions.
  5. Block search engines from tracking you.
  6. Browse online with a secure VPN.
22 Apr 2022

How does identity theft happen online? ›

Spyware transmits your sensitive data, using your own internet connection. While your computer is connected to the Internet, spyware quietly transmits your personal information to cybercriminals, which can include: Credit card numbers. Bank account numbers.

What are the basic rules protecting yourself online? ›

You can help protect yourself online by using strong passwords, avoiding dangerous links, backing up your data, and more. Here are our 10 most important tips for staying safe online.

What should I do if my identity has been compromised? ›

  1. Call or email the fraud department of the companies, banks or credit unions where accounts have been compromised. ...
  2. Contact any of the three credit reporting agencies and ask that a free fraud alert be placed on your credit report.

Should I be worried if someone has my Social Security number? ›

A dishonest person who has your Social Security number can use it to get other personal information about you. Identity thieves can use your number and your good credit to apply for more credit in your name. Then, when they use the credit cards and don't pay the bills, it damages your credit.

What happens when you freeze your Social Security number? ›

A “security freeze” blocks access to your credit unless you have given your permission. This can prevent an identity thief from opening a new account or getting credit in your name.

How can I protect myself from identity theft online? ›

How can I protect my identity online?
  1. Protect your computer and smartphone with strong, up-to-date security software. ...
  2. Learn to spot spam and scams. ...
  3. Use strong passwords. ...
  4. Monitor your credit scores. ...
  5. Review your credit score. ...
  6. Freeze your credit. ...
  7. Only use reputable websites when making purchases. ...
  8. Stay alert.

How can you protect yourself from identity theft quizlet? ›

What are 4 ways you can protect yourself from identity theft? Watch your bank statments and credit card bills, Avoid identity theft on the internet-use secure websites, Review your credit record and report fraudutent activity, Protect your personal information.

How can you avoid becoming a victim of identity theft quizlet? ›

How can you avoid becoming a victim of identity theft? Avoid giving your social security number on a phone call you did not initiate. What is a credit score? A number used to determine how much credit to extend to a person.

How do people steal your identity? ›

Identity theft usually begins when your personal data is exposed through hacking, phishing, data breaches, or other means. Next, a criminal makes use of your exposed information to do something illegal, such as opening an account in your name.

How do I stop someone opening a bank account in my name? ›

Contact the major credit bureaus

Fraud alerts are free and require companies to verify your identity before opening any new accounts in your name or changing any existing accounts. Another option is to contact each of the credit bureaus to add a credit freeze.

What is an example of identity theft? ›

Once identity thieves have your personal information they may: Go on spending sprees using your credit and debit account numbers to buy “big ticket” items like computers or televisions that they can easily re-sell.

How do I check to see if someone is using my Social Security number? ›

If you believe someone is using your Social Security number to work, get your tax refund, or other abuses involving taxes, contact the IRS online or call 1-800-908-4490. You can order free credit reports annually from the three major credit bureaus (Equifax, Experian and TransUnion).

Which of these actions should you take if your wallet is stolen? ›

Lost or Stolen Wallet? Here's What to Do
  1. Call Your Bank to Report Your Debit Card as Stolen. ...
  2. Call Your Credit Card Issuers to Report Your Cards as Stolen. ...
  3. File a Police Report. ...
  4. Make a List of Everything That Was in Your Wallet. ...
  5. Initiate a Fraud Alert on Your Credit Report. ...
  6. Replace Your Driver's License.
12 Jul 2018

Which consequences can victims of identity theft face? ›

After the initial shock wears off, victims of identity theft often experience anger, fear, insecurity, anxiety, and even depression. Being victimized by a stranger or, worse, someone you know can take its toll on you emotionally.

Which action will be least helpful if you've been the victim of identity theft? ›

Which action will be least helpful if you've been the victim of identity theft? Withdraw your money from all accounts. The best way to investigate fraudulent transactions on your credit card is to: Review your recent credit card statements.

What is the most common method used to steal your identity? ›

The most common way an identity thief can acquire information from a person is from stealing their purse or wallet and an identity thief may take a person's personal information from the internet.

What are the 3 actions Someone must take if their identity is stolen quizlet? ›

Match
  • Call the companies where you know fraud occurred.
  • Place a fraud alert on your credit reports and get copies of your report.
  • Report identity theft to the FTC.
  • File a report with your local police department.

Do I call 911 if I lost my wallet? ›

Should I report a stolen or lost wallet? Yes. Call your local police department and file a police report. You can use this report later if you need to order a new driver's license or Social Security card.

Can someone steal your identity with your phone number? ›

Your phone number is an easy access point for scammers and identity thieves. Once they know your number, they can use it to send you phishing texts, trick you into installing malware and spyware, or use social engineering attacks to get you to hand over your personal identifying information (PII).

How do I know if someone opened a credit card in my name? ›

The best way to find out if someone has opened an account in your name is to pull your own credit reports to check. Note that you'll need to pull your credit reports from all three bureaus — Experian, Equifax and TransUnion — to check for fraud since each report may have different information and reporting.

What are the 5 most common types of identity theft? ›

Here are five common types of identity theft to help you stay one step ahead of hackers.
  • Financial identity theft.
  • Medical identity theft.
  • Criminal identity theft.
  • Synthetic identity theft.
  • Child identity theft.
15 Jul 2022

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