What you need to know about online identity theft

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In today’s digital world, it’s more important than ever to protect your identity. With so many of our personal details stored online, it’s easy for criminals to steal our information and use it for their own gain. Identity theft can be devastating, leaving victims to deal with the financial and emotional fallout. But there are steps you can take to minimize your risk and help keep your information safe.

Identity theft is a serious crime that can have enormous consequences for victims. Here are the key things to understand: 

  • What identity theft is
  • How cybercriminals steal and misuse your information
  • How to protect yourself from becoming a victim 
  • What to do if you are a victim of identity theft.

Personal information

Personal information is any information that can be used to identify an individual. This includes information such as your name, address, date of birth, Social Security number and driver’s license number.

Personal data, sensitive data and personally identifiable information (PII) are similar terms with subtle differences. You may want to read about sensitive data and its differences from personal data, with a view of privacy regulations, in detail here.

What is identity theft in computer terms?

Identity theft in computer terms is the act of stealing someone’s personal information in order to gain access to their accounts or to impersonate them. This can include stealing someone’s name, address, date of birth, Social Security number or driver’s license number.

Why is identity theft so common?

Identity theft is so common because it is relatively easy to do and it can be profitable for the thieves. They can use your stolen information to open new accounts in your name, run up charges on your existing accounts or even apply for loans in your name.

How long has identity theft existed?

Identity theft has existed for as long as people have had personal information. However, it has become more common recently due to the increasing amount of personal data online and this can be easily accessed by cybercriminals.

Is identity theft a crime in the U.K.?

Using a stolen identity for various activities related to obtaining credit is a criminal offense.

ID or Identity theft on its own is not a crime in the U.K. Using a stolen identity is.

Is identity theft a crime in the U.S.?

Yes. The U.S. Congress passed a law in 1998 to declare identity theft a federal crime.

Notable identity theft examples

Examples of identity theft linked to data breaches include things such as credit card fraud, tax refund fraud and medical identity theft. For example, in 2016, Yahoo suffered a massive data breach, exposing the private information on over one billion users. This led to many individuals becoming victims of identity theft, with their personal data being used for things like opening fraudulent bank accounts and taking out loans in other people’s names

Another notable example is the Equifax hack in 2017, which exposed sensitive information on over 145 million Americans. Post-breach, many people have been affected by identity theft and subsequent fraudulent activity, such as credit card fraud and tax refund scams. Despite these risks, it is crucial that we continue taking steps to protect our personal information, such as using strong passwords and antivirus software and being mindful when sharing our personal data online.

Overall, identity theft is a serious problem in today’s digital age, as millions of people have become victims of fraudulent activity through data breaches. However, by taking steps to protect ourselves from these breaches and keep our personal information secure, we can help reduce the risk of becoming a target for identity thieves.

How easy is it to have your identity stolen?

It is relatively easy to get your identity stolen. All a thief needs is some of your personal information, such as your name, address and date of birth. They can then use this information to open new accounts in your name or to impersonate you.

How does identity theft take place?

Identity theft occurs when someone obtains your personal information without your permission and uses it to commit fraud or other crimes. Identity thieves may use your information to open new accounts, file for benefits or make purchases in your name.

There are several ways for identity fraudsters to get hold of your information. They may:

  • Steal your wallet, purse or mail — including bank and credit card statements, pre-approved credit offers, new checks or tax information — from your home, office or car.
  • Go through your trash or recycle bin looking for bills or other discarded personal information that contains your name and address. This is called “dumpster diving.”
  • Call you pretending to be from a legitimate company or government agency and ask for your personal information. This is called “phishing.”
  • Complete a “change of address” form to have your mail forwarded to another location without your knowledge.
  • Buy personal information from sources who have access to it, including employees of stores, hotels and restaurants; dishonest people who work in the credit industry; or “data brokers” who collect information from public records and other sources.

Once they have your information, identity thieves may:

  • Open new accounts in your name and run up charges on them — often by ordering new credit cards, opening new utility accounts or getting a loan in your name. They may even give your name to someone else for criminal purposes.
  • Use your existing accounts for fraudulent purposes — such as making unauthorized charges or writing bad checks.
  • Call your credit card issuer to change the billing address on your account so that you will no longer receive your statements. The identity thief then runs up charges on your account and you are none the wiser until you get a call or letter from the collection agency.
  • File for bankruptcy to avoid paying debts they’ve incurred under your name or to avoid eviction.
  • Get a job using your Social Security number (SSN). The identity thief may use your SSN to get a driver’s license, which can be used as a form of identification to commit other crimes. Or, the thief may give your SSN when applying for a job and avoid paying taxes on their earnings. As a result, you may be reported to the IRS for failing to pay taxes on income that you never received.
  • Obtain medical care and prescription drugs in your name, which can ruin your credit and cause you to incur high medical bills.
  • Commit other crimes, such as using your information to get a passport or driver’s license or to rent an apartment. They may even give your name to the police during questioning for a crime they have committed.

Types of identity theft

Identity cloning and concealment: This is when someone takes on your entire identity to hide their own. They may use your information to get a job, rent an apartment, obtain government benefits or even commit crimes.

Criminal identity theft

This is when someone uses your information for criminal purposes such as writing bad checks, getting arrested or evading law enforcement. If your information is used by someone who is stopped or arrested by the police, it may become associated with their criminal record. This can make it difficult for you to get a job, rent an apartment or be approved for credit. However, this is not always the case, as you can prove to authorities. The underline here is the implication and the associated hassles with stolen information.

Synthetic identity theft

This is a relatively new type of identity theft, where thieves create an entirely new identity using real and fake information. This can be used to open new accounts, obtain credit and get benefits such as government services.

The challenge with synthetic identity theft is that it can be difficult to detect, especially since the thieves may not attempt to use the new identity for some time.

Child identity theft

Thieves may use your child’s Social Security number (SSN) to apply for credit, get utilities or rent an apartment. They may even commit crimes in your child’s name. This can go undetected for years and have a major impact on your child’s credit report and future opportunities.

Child identity theft is a serious and growing problem globally.

Given the devastating consequences that can result from identity theft, it is important to take steps to educate your children and help them protect against this type of crime.

Financial identity theft

This is when someone uses your name or personal information to open up credit cards, apply for loans, rent an apartment, get a job, change their address on their driver’s license and so on.

Identity theft online

This is when someone uses your name or other personal information to steal money or commit other crimes by taking advantage of the Internet. For example, they may use your birthdate to sign up for free trials online that they then abuse. Or they may hack into your social media accounts and post inappropriate or harmful messages to damage your reputation.

Medical identity theft

This is when someone uses your insurance information to receive medical care or prescription drugs. They may even give your name to the police during questioning for a crime they have committed. This can seriously affect your credit, cause inconvenience, and sometimes incur high medical bills.

Stolen medical information such as records of prescription drugs is a big underground market in the cybercrime world. As online transactions and digital data storage increase, so do online security threats. Identity theft is one of the most serious and far-reaching threats to consumer safety today. It can cause financial loss, damage credit history, expose personal information, harm reputation and disrupt lives.

The top 5 signs of identity theft

Also known as indicators of identity theft, these are the top signs of identity theft:

1. Unusual or unexplained account activity. This could include strange withdrawals, charges or debits on your accounts.

2. Unexpected bills or collection notices. If you see unusual transactions or charges on your credit report, this could be a sign that someone has stolen your information and is using it to make unauthorized purchases.

3. Suspicious emails or texts. Be wary of unsolicited messages asking for personal information or login credentials. These could be attempts at phishing, which is when scammers try to trick you into revealing sensitive information.

4. Cancelled checks or credit cards missing from the mail. If you notice that any of your financial documents are missing, someone may have intercepted them in an attempt to steal your information.

5. A sudden drop in your credit score. If you see a significant decrease in your credit score, it could be an indicator that someone has stolen your identity and is using it to rack up debt in your name.

If you suspect that you may be the victim of identity theft, it’s important to act quickly. You can start by contacting the credit bureaus and placing a fraud alert on your credit report. Contact your bank and let them know what’s going on.

By taking these steps, you can help protect yourself from further damage and ensure that the thief is brought to justice.

What do attackers do with stolen information?

There are many ways that attackers can use stolen information. One common way is to use it to gain access to other accounts that the victim has, such as their email or social media account. This can give the attacker a way to spam the victim’s contacts or post embarrassing things on their behalf. This is impersonation for further attacks. Another way that attackers use information theft to commit identity theft using the victim’s personal details to open new accounts or make purchases in their name. This can ruin the victim’s credit score and leave them with large bills to pay. Other times, attackers use stolen identities for wire transfers where it’s too difficult to track recipients. Finally, attackers may simply sell stolen information on the dark web/underground market, where it can be used by anyone for any purpose.

How to reduce the risk of identity theft

The top suggestions to reduce the risk of identity theft are:

1. Always be vigilant about protecting your personal information and accounts and ensure that any devices or software you use to access sensitive data has strong security features in place.

2. Avoid sharing personal details on social media sites or other public platforms and always keep an eye on your credit card statements to detect suspicious activity as soon as possible.

3. Consider using a password manager to help create and store strong, unique passwords for your various online accounts and enable multifactor authentication whenever possible to further safeguard your information.

4. Work with trusted organizations (such as banks or government agencies) to enable additional security measures like fraud alerts or PINs for certain transactions. And finally, consider enrolling in identity theft protection services that can help monitor and defend your identity against emerging threats.

Being vigilant about protecting your personal information to using strong security features on your devices and software are some easy ways to protect yourself. Key steps in this vein include:

  • Avoid sharing personal details online.
  • Keep an eye on your credit card statements for suspicious activity.
  • Use a password manager to create strong passwords for all accounts.
  • Enable multifactor authentication whenever possible.
  • Take advantage of security measures like fraud alerts or PINs offered by trusted organizations.
  • Enroll in an identity theft protection service, this can help you stay on top of emerging threats and safeguard your information from would-be attackers.

How to protect yourself from identity theft

Protecting yourself from identity theft is much like protecting your home from burglars. You can reduce the risk of becoming a victim by following these tips and tricks:

  • Be cautious when sharing personal information online. Avoid connecting with people you do not know or giving out sensitive information like your PIN or credit card number to anyone who contacts you online.
  • Review your financial accounts regularly for suspicious activity and report anything that looks unusual right away. Set up alerts on your bank accounts to notify you anytime there is a purchase over a certain amount, so you can act quickly if something suspicious has occurred.
  • As a business, you should consider ethical hacking simulation exercises such as penetration testing for your web applications, networks and devices. 
  • Store important documents in a safe place at home, like a fireproof safe or safe deposit box at the bank, so they cannot be easily stolen or lost.
  • Be aware of what personal information is stored on your electronic devices and take steps to secure it with passwords or encryption. If you lose your laptop, smartphone or another device, contact your service provider right away to disable any accounts that may have been accessed without your permission.
  • Keep a close eye on your mail and trash for signs of someone going through them. If you notice anything missing or out of place, report it immediately to the police and your financial institution(s).
  • Use shredders to destroy sensitive information like credit card offers, bank statements and other documents that could be used to steal your identity.
  • Be wary of emails, texts and phone calls asking for personal information. If someone claims to be from a legitimate company or organization, always verify their information by contacting them directly through a phone number or email address you trust.
  • A bank will never seek your PIN, security number or password over the phone or via email. You will never have to divulge this information to anyone.
  • Protect your Internet-connected devices with automatic updates and non-default passwords.
  • Do not use untrusted Wi-Fi networks. Use 4G/5G where possible. If you must use it for other reasons, always use a VPN.
  • Always call back your bank or the organization rather than revealing information to untrusted sources if you are not certain.
  • When you move houses and offices, ask the post office to redirect your post for at least six months.
  • Do not post any pictures showing your registration plate, house number or personally identifiable information (PII) that can be misused against you. Fraudsters can use this to connect other pieces of the string required to carry out identity theft attacks against you.

If you are concerned about protecting your business’ crown jewels, you should consider ethical hacking exercises such as application penetration testing or network security assessments to assess your security controls. 

Identity theft protection of deceased family members

If a family member dies, their name can be used fraudulently. This is called “ghosting.” To stop this, you can put a ‘marker’ on their credit file at the three major credit (and others) reference agencies:

The following organizations offer deceased person services along with further information on this topic:

Reporting (U.S. & U.K.)

In the U.S., you can contact the Federal Trade Commission (FTC) online or via its ID theft hotline at 1-877-438-4338 for help and advice. 

In the U.K., you can report identity theft to the Identity Fraud Action (IFAC) helpline on 0300 30 300 20 as well as to the police. 

For additional resources and support, visit your country or region’s government website to learn more about identity theft protection and prevention.

Additionally, If you believe you may be at risk of becoming a victim of fraud based on unusual activity or linked to an organization that’s lost or leaked data, you can opt for the Cifas protective registration service.

Report and recover

Identity theft can have a major impact on your life. By taking steps to protect your identity and being aware of the signs of identity theft, you can help prevent yourself from becoming a victim. If you think you may have been a victim of identity theft, it is important to report it to the proper authorities so that they can take steps to help you recover.

To sum up, identity theft can be prevented by taking some simple precautions and being aware of the signs. If you think you may have been a victim of identity theft, it is important to report it to the relevant institutions and authorities so they can help you recover.

Harman Singh is the director of Cyphere.


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