ID theft occurs when someone fraudulently acts as you in order to obtain money. Learn about the warning signals and how to avoid them.
Identity theft occurs when someone impersonates you using your personal information — your name, Social Security number, birth date, and so on — and then steals from you.
It’s a rising problem in the United States, and pandemic relief exacerbated it as identity thieves targeted relief cheques and jobless assistance. Theft of benefits increased by a startling 2,920 percent in 2020 compared to 2019. In total, the Federal Trade Commission received 1.4 million consumer complaints of identity theft in 2020, a 113 percent increase from the previous year.
Here’s what you need to know to lower your chances of being a target, recognize warning signs, and act quickly to minimize harm.
What exactly is identity theft?
Identity theft occurs when someone utilizes your personal data to impersonate you or steal from you. Identity thieves may deplete your bank and investment accounts, create new credit lines, obtain utility service, steal your tax refund, use your insurance information to obtain medical treatment, or provide authorities with your name and address when they are arrested.
Because of the frequency of data breaches, your information may already be at risk. In this new world, it’s prudent to take precautions to keep criminal actors from stealing your personal information and harming your financial situation.
In this new world, it’s prudent to take precautions to keep criminal actors from utilizing your personal information and damaging your financial life.
7 types of identity theft and the warning signs
Once a criminal has your information, these are some common ways it might be used:
1. Credit identity theft
Credit identity theft occurs when a criminal uses your personal information, such as your birthdate and Social Security number, to apply for a new credit line.
Warning indicators include an unusual change in your credit scores or the appearance of an account on your credit reports that you do not recognize. You may receive debt collection notices or a court judgment against you. The best way to avoid it is to freeze your credit.