What Is Identity Theft? Definition & Examples
Identity theft is when someone steals personal or financial information about someone else and uses it to commit fraud.
Identity theft is one of the top concerns for consumers. In 2020, the Federal Trade Commission (FTC) received more reports of identity theft than any other form of complaint, with these reports making up nearly a third of all complaints with close to 1.5 million reports about identity theft.
Identity theft can occur when criminals steal your personal information, including your name, birthday, address, phone number, social security number, and/or financial information. This can be done in either the physical or digital world — wherever personal data is stored.
Identity theft is used to commit fraud. A bad actor takes this information and poses as you to steal data or money, or to gain access to privileged information or services.
To protect against identity theft, you will need to guard your personal data and practice good cyber hygiene to keep online information secure and out of the hands of fraudsters.
Identity theft definition
Identity theft is a crime where someone steals the personal data of another person and then uses it to commit fraud, typically for financial gain. The following information can be stolen during identity theft:
- Name
- Address
- Phone number
- Social security number
- Login information (username/password)
- Bank statements and/or account numbers and information
- Credit card numbers
- Biometric data
Identity theft can involve a thief literally sifting through discarded documents or trash to obtain personal identity information or stealing off a person directly. It can also involve cybercrime where bad actors steal information or data through scams, malware, hacks, or security breaches.
Identity theft is usually performed in order to commit identity fraud, which is the use of another individual’s personal information without permission. Identity fraud is when one person claims to be someone else.
Identity fraud is committed to steal information, get access to restricted resources, or for financial gain.
Financial losses from identity theft continue to rise. In 2021, they were projected to be close to $725 billion in the United States alone.
Types of identity theft & identity fraud
There are a number of ways that identity theft can occur. Different forms of identity fraud, which can include the following:
- Financial identity theft and fraud: This type of identity theft involves stealing bank account information, credit card numbers, or personal information to use in financial fraud to obtain goods, services, benefits, credit, or money directly. Financial identity theft is the use of stolen identity for the purpose of financial gain, and it is the most common form of identity theft.
- Child identity theft: Children are increasingly becoming the victims of identity theft. This occurs when a child’s personal information, such as name, date of birth, and/or social security number, is stolen and used for fraud. Fraudsters may open accounts with this information or apply for services, loans, or government benefits.
Child identity theft is often not discovered until years later when the child attempts to use their own information for credit applications or services.
- Tax identity theft and fraud: This type of identity theft involves stealing personal information like a social security number and using it to then file a federal or state tax return for the purpose of obtaining a bogus tax refund.
- Social security identity theft and fraud: When someone steals a social security number, it can be used to commit fraud by applying for loans, credit cards, medical benefits, disability, and government benefits. This type of identity theft and fraud can dramatically impact the legitimate person’s credit score and make it more difficult for them to obtain necessary benefits they are entitled to.
- Medical identity theft and fraud: