This post has been modified to reflect new information since its original publication.
With massive data breaches occurring at an increasing rate, you need to be aware of the dangers you face if your data is exposed. Here are eight of the most common types of identity theft, as well as some tips on how to protect yourself.
1. Social security number identity theft
A social security number is the key to obtaining credit, opening bank accounts, and receiving government benefits. As such, it is the most powerful personal identifier you have.
Unfortunately, this makes it attractive to identity thieves, who can use your number to steal your welfare payments. Your social security number also enables thieves to obtain a fake driver’s license and facilitates other types of identity theft, including credit and tax fraud.
How to prevent it
- Don’t carry your social security card with you.
- Store it in a secure location, like a safe, in your home.
- Don’t share your social security number unless it’s absolutely necessary.
2. Child identity theft
Child identity theft occurs when an individual uses a child’s social security number or other personal information to defraud the government or obtain loans, credit cards, and other services. Additionally, people use the information in the stolen identities to commit crimes.
This form of identity theft is growing increasingly popular because the crime is likely to go undetected for years, especially if the victim is very young. Consequently, 1.3 million children (half of whom are under age 6) experience identity theft each year.
“There is nothing more delicious to an identity thief or scammer than to get a Social Security number and information for a child. In some cases, you can have a 15-year or more run where no one’s looking.”—Adam Levin, founder and chairman of CyberScout
What makes this crime even more disturbing is the fact that over a quarter of the perpetrators are friends or relatives of the victims. In the case of Axton Betz-Hamilton, for example, her mother stole her identity when she was in 5th grade. She only found out when she was turned down by a utility company when she was moving into a college apartment.
How to prevent it
- Teach your child to only give his or her personal information to a teacher or other trusted adult.
- Hand-deliver any school forms to the office instead of sending them with your child.
- Check with a credit bureau to see if your child has a credit history.
“Read privacy policies and check the privacy settings for all apps you use. Many offer extra mechanisms to keep personal info safe.”—Diana Graber, founder of CyberCivics and CyberWise and author of Raising Humans in a Digital World
3. Banking identity theft
One of the more terrifying and costly types of identity theft, banking identity theft involves stolen credit cards, debit cards, and bank account information—usually acquired through a skimmer device, a data breach, or an unsecured connection or website. Thieves then use this information to purchase goods and services using the money in the victim’s accounts.
According to a 2017 study, nearly half of all Americans experienced credit card identity theft in the last five years. And more than 20% had their debit cards compromised. The average direct financial loss was $7,761.
How to prevent it
- Collect your mail every day. If you go out of town, place a hold on your mail.
- Monitor your bank or credit card statements for suspicious transactions.
- Know when to expect your bank or credit card statement and contact the institution if it is late.
- Keep your cell phone’s operating system up to date to deter hackers.
- Shred any documents (like offers of credit, receipts, expired credit cards, and account statements) that contain your personal information.
- Install antivirus software and firewalls on your personal computer.
- Only use strong passwords, and make sure to change them, especially if a company you use has experienced a data breach.
- Don’t connect to your accounts over an unsecured public network. If you must use public Wi-Fi, set up a virtual private network (VPN).
“In addition to common sense, using a trusted VPN service is crucial to protecting privacy and maintaining anonymity whenever you are on line.”—Netsanity, mobile parental control software company
4. Credit identity theft
This type of identity theft involves another individual using your identity and financial reputation to open new credit card and bank accounts or take out loans. Because you need a social security number to do these things, you can assume that yours has been stolen if new financial accounts appear on your credit report.
How to prevent it
- Thoroughly review your credit reports at least once a year to check for new accounts you never opened.
- Put a freeze on your credit with Experian, Equifax, TransUnion, and Innovis. This prevents anyone from opening new accounts or services in your name.
5. Tax identity theft
Tax identity theft takes place when someone uses another person’s social security number to get a job or file a fraudulent state or federal tax return using another person’s information, usually to receive that individual’s tax refund. Unfortunately, most people don’t realize that this has happened to them until the IRS or state treasurer notifies them that someone else has already filed a return for that social security number.
In 2011, identity thieves stole $3.6 billion in tax refunds because the IRS wrongly processed 1.1 million possibly fraudulent tax returns. Included in this number are 5,500 fake returns (worth nearly $27 million in refunds) filed by a single preparer and a payout of $490,000 to a Bulgarian address listed on over 700 tax returns.
How to prevent it
- File your taxes early to beat fraudulent filers.
- Don’t leave tax forms out where thieves might find them.
- Shred old tax documents you no longer need.
- Ask the IRS to directly deposit your refund so criminals can’t steal the check from your mailbox or redirect the money to their address.
6. Medical identity theft
Medical identity theft involves someone posing as someone else in order to file a false insurance claim or seek medical treatment. According to a 2015 survey, over 2 million Americans experienced medical identity theft in 2014, and this was before the enormous Anthem breach, which affected nearly 80 million people. Most people don’t know they are a victim until they start getting bills for services they never received.
This form of identity theft costs victims an average of $13,500. And because the thief in these situations enters his or her own conditions and medical history into your medical records, your risk of misdiagnosis and incorrect treatment increases. As such, medical identity theft can be as dangerous to your health as it is to your wallet.
How to prevent it
- Only give your health insurance/Medicare ID numbers to the healthcare providers you visit.
- Examine all explanation of benefits statements for unfamiliar services, dates, or prescriptions, and tell your health insurance company about any questionable charges you find.
- Ask for a copy of your medical records and thoroughly review them for any incorrect information.
7. Social media identity theft
An individual commits social media identity theft when he or she duplicates or hijacks someone else’s social media account. While this activity might seem innocuous, it can cause serious harm. For example, once someone has hacked into your account, that person can often figure out how to access your non-social media accounts, especially if you tend to reuse passwords. Hackers might even try to scam the people in your personal network.
Employers, insurance companies, and potential romantic partners judge you based on your social media presence. For example, if your social media profiles paint a bad picture of you, you might not get that job you wanted. Your insurance rates might go up if you appear to be skydiving in a Facebook post. And that special someone might not give you a second look if you seem to spew hateful rhetoric on Twitter.
How to prevent it
- Avoid oversharing on social media. You might be giving thieves clues to your passwords.
- Don’t accept friend requests from strangers. “Friending” people gives them access to more of your information.
- Don’t give out private information to third-party apps, like quizzes and games.
“On social media, restrict personally identifying information (such as friend and family listings, and birthdays) to specific groups of people you trust. Information such as your birthday and your mother’s maiden name can be utilized to compromise your identity.”—Netsanity, mobile security software firm
8. Offender identity theft
Offender identity theft involves an individual giving someone else’s personal information to a police officer in order to stay out of trouble. Often, targeted individuals don’t realize that a criminal is using their identity until they get apply for a job or get pulled over for a simple speeding ticket—only to discover that there are warrants out for their arrest.
Thieves don’t have to know your social security number to commit this crime; all they need are easily obtained items like your name and address—often paired with a fake photo ID—to tie you to a crime you had no part in.
Although this form of identity theft is not as common as credit or financial fraud, it is arguably worse because it’s much harder to alter legal records. And to add insult to injury, you will have to put up with all the societal repercussions associated with being labeled a criminal while you fight the legal system to clear your name.
How to prevent it
- If you lose or misplace your social security number, contact the Social Security Administration to obtain a new number.
- If someone steals your driver’s license, call the DMV to request a new number—not just a new copy of your license.
For more information
Experiencing one or more of the types of identity theft described above can result in a significant loss of time and money. To avoid this, you can read the following articles about keeping your online information safe: