The U.S. Department of Justice says that identity theft and identity fraud refer to crimes in which someone illegally obtains and uses someone else’s personal information for fraudulent and deceptive purposes.
Financial identity theft is the most common type of identity crimes. A thief steals your personal data to seize your financial accounts or create new ones in your name. For example, cybercriminals can get your credit card information and make unauthorized purchases on your account. Even worse is when cybercriminals gain access to your online banking information and siphon the funds from your accounts.
Medical identity theft involves using another person’s information, such as their health insurance number, to access medical services and products. In most cases, these thieves claim to be you when filing claims with your health provider or obtaining prescription drugs.
It is common knowledge that you should protect your Social Security card and avoid casually giving out your Social Security number. This is because a person who deceptively gains access to this information can use your number to acquire tax benefits or file false tax refunds in your name.
There are numerous ways that identity theft happens. Here are a few examples.
When cybercriminals hack to access a database, they can collect personal information from thousands, if not millions, of users at one time.
Malware is a software intentionally designed to gain access to or damage a computer. At times, the user may not even know it is on his or her computer. Malware can monitor the computer’s activity and gain access to previously saved data and information. Malware usually is installed if you surf through an infected website or click an infected link.
If you ever had your wallet stolen or have had your credit card copied by a cashier or waiter, you have likely been a victim of credit card theft. As technology develops, thieves no longer need to have your physical credit card to make unauthorized transactions. All they need is your credit card number, expiration date, and sometimes your security code to commit credit card theft.
Phishing and spam attacks are usually committed through emails or phone calls asking for personal information. These criminals typically disguise themselves as a trustworthy entity, such as your bank or credit card company. They usually ask you to verify your personal information and or direct you to a link that is infected with malware.
Besides the immediate financial loss of your bank account or running up your credit card bill, identity theft can severely damage your credit score and has serious tax implications. In some cases, you may lose complete access to your accounts. Identity theft can lead to other long term consequences, such as your ability to take out loans in the future.