Identity Theft Protection: How It Works & Do You Need It?
Identity theft protection: how it works & do you need it?
There were 1.4 million reports to the FTC (Federal Trade Commission) of identity theft in 2020. This was double the number of reports from the year before.
Identity theft occurs when your personal information is stolen to commit fraud and used without your permission. Identity theft is often perpetuated for financial gain or to obtain services such as health care or tax benefits. In 2020, identity fraud losses involving identity fraud scams reached over $40 billion.
Identity theft can tank your credit score, block your access to government or important services, and cost you a lot of time and money.
To prevent identity theft, you should be aware of the potential scams that bad actors are using to steal personal information. Additionally, it is important to practice good cyber hygiene and keep an eye on your credit score.
An identity theft protection service can help to monitor your credit files, alert you of any suspicious activity, and help you to recover lost money and repair your credit score if you become a victim of identity theft.
What is identity theft?
When someone obtains your personal identity information, often through fraudulent means, this is identity theft. This information can then be used in an unauthorised manner to commit fraud. This is often done for financial gain.
Sensitive personal identity information can include the following:
- Your full name
- Social Security number
- Address
- Birthdate
- Driver’s license information
- Bank account and/or credit card numbers
Threat actors can gain access to this identity information through physical or digital means. This can involve digging through your trash or stealing your mail to obtain bank and credit card information as well as many other different forms of cybercrime. Identity theft is a serious crime that can damage your credit score, impact your finances, and take a lot of time and effort to recover from to take your identity back.
Types of identity theft
There are several different kinds of identity theft that often involve cybercriminals scamming people out of their credentials to access this sensitive data. This can include receiving an unsolicited email, phone call, or text message asking you to provide personal identity information or logging in to a seemingly legitimate website that is actually an attempt to gain your credentials through fraudulent means.
Threat actors can also obtain user credentials through data breaches or by hacking your username and password. Outdated, repeated, and weak passwords are particularly vulnerable.
Once a bad actor has access to your credentials, they can then use this to log in to your accounts, such as your mobile bank account, to find your identity (and often financial) information and use it for malicious purposes. These are common types of identity theft:
- Financial identity theft: One of the most common forms of identity theft, financial identity theft involves a fraudster using your personal information for direct financial gain. This can include stealing funds fr