These days, you hear all sorts of stories about stolen identities. If you haven’t been the victim of identity theft, chances are, you’ve heard of data breaches in the news, or you personally know someone who had their information stolen.
In 2018, roughly 1 in 5 Americans ages 16 and older were impacted by identity theft. That’s nearly 60 million people and that number is the highest to date.1
It’s important to be proactive and understand: what identity theft is, why it happens, and how you can help reduce your risk of being affected.
Identity theft happens when a thief uses someone’s personal information, such as their name, Social Security Number, or credit card number, without permission and usually for financial gain.2 Identity theft can occur in various ways and is outlined in these most common forms:3
Social Security Number Theft (34% of cases)
A scammer takes someone’s Social Security Number or another form of personal identification, such as their birthdate and/or name, to open a line of credit or acquire employment. With this information, the scammer can do just about anything, such as: open a new account, file fraudulent tax returns, obtain medical care, or steal benefits.4 Sign up for alerts and be notified when your social security number is used or check your credit score for free with annualcreditreport.com.
Credit Card Theft (33% of cases)
This happens when a criminal uses another person’s credit card to make unauthorized purchases. To gain access to your credit card, the criminal could contact your credit card provider and change the mailing address, which would allow the scammer to receive your statements and avoid suspicion. Or, they could also open a new credit card account under your name. Should either of these events occur, charges can be disputed with your credit card provider. When reported right away, these charges are typically covered by the lender or financial institution in fraudulent situations. At GECU, we have a zero liability policy on our debit and credit cards, meaning that you won’t be held responsible for any unauthorized charges, online or otherwise, when reported immediately.
Phone or Utility Theft (13% of cases)
A scammer uses a form of personal identification to open a mobile phone plan or utility account. If you receive an unauthorized bill, contact the phone or utility provider.
Bank Fraud (12% of cases)
A thief obtains existing financial account information or opens a new account in the victim’s name using personal identification information. With the account information, the thief could write bad checks under the account or use checks/debit cards to drain the account. Consistently monitor your account(s) using online banking or a mobile app to stay on top of purchases and check statements.
Loan or Lease Theft (7% of cases)
A criminal uses personal data to take out a loan or lease in someone’s name. If this happens, you may receive bills or statements that are unfamiliar to you. Contact the financial institution or organization to alert them of any unusual activity.
Government Benefits or Documents Theft (7% of cases)
A thief uses a form of personal information to collect government benefits, such as filing a tax return. A red flag should go up if you attempt to file your tax return and the tax software says the tax refund has been claimed. Should this happen, fill out IRS Form 14039 and contact your state taxing authority.5
In addition to the above list, other less common forms of identity theft that can occur, include:
Child Identity Theft
A crook misuses a child’s personal data. Often free of negative marks, a child’s Social Security Number is an easy target to get approval for new lines of credit or other financial gain. Lock away your child’s personal documents (i.e. birth certificates and social security cards) to reduce the risk of this happening.
Medical Identity Theft
A scammer uses personal information for health treatment or services. Monitor any medical bills you receive and ensure any medical information you share is confided in someone you trust.
How Personal Information is Stolen
- Wallet or purse is stolen, containing personal information
- Bank or credit card statement(s) are stolen from your mailbox
- A change of address form is completed under your name
- Information is gathered from the trash
- Phishing or when a scammer contacted you posing as someone you think you can trust
How to Protect Yourself from Identity Theft
- Obtain and review a copy of your credit report through annualcreditreport.com. Every 12 months, you can obtain a free credit report from the three major credit bureaus: Equifax, Experian, and Transunion. Review the report(s) regularly and report any suspicious activity to the IRS.
- Monitor your accounts and personal information. Use your financial institution’s online banking or mobile app for 24/7 access to review your transaction history for activity you don’t recognize. If your financial institution provides the option, sign up for text alerts and when your account balance dips below a certain level, you’ll be notified.
- Report lost or stolen debit or credit cards. Immediately contact your financial institution as soon as you are aware of the disappearance. That card can be blocked, and a new card issued. Additionally, if your financial institution offers it, take advantage of card control capabilities to turn your card(s) on/off when you don’t need to use them to prevent fraudulent transactions. You should also sign up for alerts to be notified when your card is used.
- Do not give out personal information over the phone, via email, or online. Unless the contact was initiated by you in regard to opening an account/loan or questions about your account, never respond to phone calls or emails requesting personal information.
- Make sure the website is safe to use. A safe website is identified by ‘https:’ and a lock icon in the upper left corner of the website URL.
- Change your login credentials. Update your online banking and any other accounts containing personal information with a new username and password every 30 to 42 days.6 Avoid using the same password on several sites.
- Open a safe deposit box. Store any sensitive information and personal belongings to ensure they don’t end up in the wrong hands.
- Shred sensitive information before throwing it away. This includes: credit card applications, medical documents, old financial statements, or anything with personal identification information on it.
To avoid falling victim, it’s important to stay on top of your accounts and regularly monitor your activity, so you can considerably reduce the risk of identity theft and the impact if it were to happen. Should it occur, it’s important to detect and report the problem as soon as it happens; the sooner it’s reported, the sooner it can get fixed.