Understanding identity theft

What is identity theft?

Identity theft is when a person steals your personal or financial information. The person who steals your information may use it to access your financial accounts, open credit accounts, file insurance claims, file tax returns, or other fraudulent activity. When a person steals your identity, it can result in financial loss, emotional distress, and potential damage to your credit score. The effects of identity theft can be disparaging, especially the repair process. Despite not being responsible for your financial destitution, you may be saddled with late payments, IRS penalties, and medical bills. The type of identity theft impacts how detrimental its effects are.

How does identity theft happen?

Technology and the internet can put your personal information at risk. There are various ways that criminals can get access to your information:

• Data breaches: Data breaches allow people to gain access to individual’s information. From banks to schools, there are plenty of organizations that have your personal information and are potential sources.
• Unsecure browsing: Certain websites may be infected with malware and viruses. Compromised websites may allow hackers to gain access to your personal information.
• Mail theft: An identity thief can steal your mail to find personal information. Bank statements and other documents containing sensitive information can help criminals steal your identity.
• Phone theft: A stolen phone can be a recipe for a stolen identity. Apps, contacts, text messages, notes, and photos may contain personal information. Identity thieves can exploit this information for their financial gain.

Forms of identity theft

Here are some common types of identity theft that you should look out for:

Bank account takeover

A criminal can gain access to your bank account and make fraudulent transactions, send money, or even gain access to other financial accounts. A bank account takeover can have disastrous effects on your financial health. The criminal accessing your bank account can bleed it dry. Account takeovers are the most common type of identity theft and can have severe financial consequences. Create strong passwords and use two-factor authentication to prevent financial fraud.

Social Security number identity theft

Keep your Social Security number safe and only give it sparingly to merchants and banking institutions you trust. Fraudsters can abuse access to your Social Security number and open up accounts in your name. Fraudulent accounts can show up on your credit report and negatively impact your credit. If you believe your Social Security number was stolen, report it to the Social Security Administration.

Debit card and credit card fraud

Stolen or skimmed debit and credit card information can put your identity at risk. With just your credit or debit card number, PIN, and security code, a criminal can easily make unauthorized transactions. With free access to your credit card, criminals can quickly damage your credit. Depending on the debit or credit card, they might be able to access your other financial accounts too. Luckily, most card issuers can help mitigate the amount of damage done. You should contact your card provider if your card information is stolen. The card provider will cancel the card to prevent any additional charges. They may also be able to reverse any charges that you did not authorize.

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Other forms of identity theft include shopping fraud, senior scams, child identity theft, biometric identity theft, and tax identity theft. With so many avenues for thieves to steal your personal information, it’s important to monitor your accounts and safeguard your information. Credit monitoring can also keep you alert of any unauthorized changes. Keep your information secure and learn more privacy and safety tips.