What Exactly Is Identity Theft and How To Identify It?

How easy is it for someone else to pretend to be you? Imagine if someone walked into your home or workplace and claimed to be you. Your family, friends and co-workers would quickly see through the obvious façade, and the attempted impersonation would fail spectacularly.

Online, however, is a different story. Somebody who has never met you, looks nothing like you and who lives nowhere near you can successfully impersonate you quite easily. So easily, in fact, that the U.S. Department of Justice estimates over 12.5 million people were victims of identity theft in 2014 – and that number is expected to increase this year.

Definition of ID Theft

According to the Bureau of Justice, there are three general categories of identity theft. They are:

  • Unauthorized or attempted use of an existing account, such as a bank account.
  • Unauthorized or attempted use of someone else’s personal information to open a new account.
  • Misuse of someone’s personal information for fraudulent purposes.

So, what is identity theft? To put it simply,it is when someone pretends to be you, either online or off.

How Can Your Identity Be Stolen?

Unfortunately, there’s not just one way stolen identities can occur. Even worse, thieves are working on new methods all the time. But by understanding some of the common ways online theft happens, you can help prevent it from happening to you. Here are three general categories of ID theft:

Online Theft Specific to You

This is what many people think of when they think of online fraud. This type of theft involves a person, or a group, who is reasonably adept at using a computer. They use their abilities to break into your computer remotely and steal your personal information.

This type of theft involves crimeware. Crimeware is malicious software used to steal personal information. Some common types of crimeware include phishing, spyware and Trojan horses.

The best way to prevent this type of theft is to avoid unsecured networks, such as those found in airports or coffee shops. Also, keep your virus and spyware protection software up-to-date.

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Offline Theft Specific to You

While the image of a skilled computer hacker is most commonly associated with identity thieves, not every instance of fraud is particularly high tech. Instead, your identity can be stolen using old fashioned lies and trickery.

Be aware of any calls or emails sent to you which request your personal information. Scammers will impersonate any number of large corporations, including banks, software companies and even government agencies. One increasingly popular scam involves scammers who pretend to be from the IRS.

The best way to fight this type of fraud is to never give out personal information to anyone who contacts you. No matter how legitimate the phone call or email seems, just hang up or don’t reply. No legitimate organization will request personal information when they initiate the contact. Only give out that info when you’re the person who originally calls or sends an email.

Large Scale ID Theft

This type of fraud is when thieves steal a large volume of personal information from a retail store, corporation or other organization. Some recent examples include the 2013 Target hack which affected 40 million people and the 2015 IRS hack which affected more than 100,000 taxpayers.

There are many organizations which know a lot of your personal information. When those organizations are hacked by thieves, your personal information can be stolen through no fault of your own.

There’s not a lot an individual can do to prevent these types of data breeches. Instead, you want to be prepared for a quick response in case something does happen. Most large data breeches will make national headlines, so pay attention to current business news. Also, a reputable identity theft protection service can help you mitigate and repair any damage.

How ID Theft can Snowball

The scariest part of online fraud is how little information is required in order to do significant damage. Once an identity thief learns your name and address, they can find your social media profile, place of employment, names of family members and more.

Even worse, if a thief has your social security number, the sky can really be the limit in terms of what they can do. They can open up bank accounts in your name, take out loans and even obtain an ID card. This is why it’s so important to protect your privacy both online and off. Even just a name and address is potentially enough for a thief to take over your entire life.

Types of Identity Theft

Usually, the main motivation for internet theft is financial gain at your expense. But what people don’t realize is there are plenty of ways for a thief to profit off your identity without ever touching your personal financial accounts. Here are a few types of online fraud which are common yet often overlooked.

Social Security Fraud

Social security numbers have many uses. When a thief has access to your SSN, he or she can now receive retirement benefits, open lines of credit, receive government assistance, receive welfare checks and more. A social security number is often an easy way for a thief to access a variety of your existing personal accounts – everything from your banking information to your medical records.

Driver’s License Fraud

Did you know you don’t need a photo ID in order to obtain a driver’s license? Identity thieves are certainly aware of this. An identity thief can walk into the DMV and walk out with a driver’s license which contains your information but the thief’s picture.

With a fake ID, a person can pass themselves off as you in a variety of situations. They can open bank accounts. They can take out loans. They can even present the fake ID when arrested. You can actually find yourself facing criminal charges for actions you had absolutely nothing to do with.

What is Identity Theft? A Potential Problem… but One with a Solution

ID theft is more than just simply someone stealing money from your bank account. With just a few scraps of information, a malicious thief can completely ruin your life. So pay attention to what type of personal information you’re sending out into the world. Diligence and knowledge are the two greatest tools in your arsenal.

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