Identity theft can occur both on and offline. It is a universal problem, one that leads to stress and inconvenience. Understanding what it is will go a long way to minimize the risk of falling prey. Unscrupulous identity thieves are using sophisticated methods more now than ever.
In this modern reality, you need to know how to minimize the risk of fraudulent activity. This will prevent you from falling prey and becoming an unsuspecting target. You don’t want debt collectors contacting you over transactions you know nothing about.
How Do Thieves Use Your Identity?
Financial identity thieves work to compromise your existing financial accounts. Unknown third parties create an account in your name and virtually tunnel their way into your personal data and finances. In this way, they compromise your financial identity.
Fraudulent activity could include debit cards and credit card fraud, as well as the compromising of loans, medical accounts, and insurance policies. Unfortunately, there is a multitude of ways thieves commit financial fraud.
How can Identity Theft Impact Your Life?
We define identity theft as the occurrence of someone stealing your identity to commit fraud. By stealing your personal data, they can use this information without your knowledge for either personal gain or do damage to others in your name. Committing a crime under someone else’s name is still a crime, and being a victim of identity theft is at best a stressful experience.
Criminals use various kinds of sensitive information to perform financial identity theft, from your personal address, your date of birth, and sometimes your maiden name. Fraudsters can also use your mother’s maiden name, social security number, and driver’s license number to embed themselves into your online accounts. They may also phish for your bank card number and your online passwords.
How Criminals Use Stolen Information
Once they have your personal information, identity thieves have the freedom to wreak havoc across both the internet and your life.
After they have access, these hackers have the power to do things such as rent an apartment or other residence in your name. Fraudsters can also open false bank and credit accounts using your identity.
It is important for you to review your credit report and credit card statements regularly. These reports and accounts alert you to any unusual activity, from charges you have not made to accounts you did not open.
How Can Criminals Get Hold of Your Sensitive Information?
Crooks use various methods to get their hands on your personal, sensitive information, such as
- Theft of your debit or credit cards, using sophisticated methods to get hold of your pin numbers
- Hacking into your online accounts
- Clever phishing to swindle you out of information via phone, email, or online
- “Skimming” your credit or debit card with a card reader or at an ATM
Furthermore, someone close to you could also use your sensitive information. Never disclose your PIN number or other personal information to anyone.
It’s also important to ensure you dispose of confidential documentation and information correctly. Throwing away paperwork for someone to retrieve is not smart.
As we’ve said before, identity theft is a criminal act. No matter how big or small, you need to report all incidents to your nearest police department. You will need to get a police report, especially for the purposes of insurance claims. Law enforcement agencies are aware identity theft is on the rise and their toolkit for handling such situations is ever-growing.
The Consequences of Financial Identity Theft
The extent of your financial losses when you fall prey to identity theft depends on the type of identity theft that was committed against you. An identity theft issue is not only unpleasant, but it is also extremely worrying.
Typical Ways Victims Feel the Effects of Identity Theft
1. Bank accounts or credit cards are emptied
What type of losses from identity theft have you experienced? Notify your credit reporting agency, and put a stop to all your cards immediately. If you have no funds left, this could negatively affect your day-to-day living expenses, so try and stop thieves before it gets to that point.
2. Credit scores are compromised
Theft could adversely affect your credit score. This can cause problems in the present and future when taking out credit or applying for a loan. If you don’t regularly manage your accounts, you may not be aware your credit has been damaged and be in for a nasty surprise.
3. Financial loss
Recouping hard-earned money in many financial identity theft cases has a positive outcome. This, however, is not always the case. If identity theft prevention isn’t possible, the sooner you know you’ve been compromised, the better off you are to regain control of the situation.
4. Identity theft resolutions take time to resolve
Resolving financial identity theft can take a toll on its victims. The process is usually long and drawn out. Resolving identity theft is often inconvenient and can cause unnecessary stress. It’s an unfortunate reality to be prepared for.
8 Smart Ways to Keep Your Personal Information Safe
Prevention is always better than a cure, and your financial security is of utmost importance. It is important to know how identity thieves operate. Now is the time to take a stand against criminal activity.
Protect your sensitive information from identity fraud with these helpful tips:
- Store your personal information and documents safely away from prying eyes.
- Don’t give out your PIN numbers. Avoid giving confidential financial information to others, and avoid disclosing sensitive information online.
- Dispose of your financial documents responsibly. Shred, tear, or burn all confidential documents before throwing them in the trash.
- Ensure your internet connection is secure before performing online banking transactions.
- Your credit score is free. Get yours today from the many reputable credit bureaus, and be sure to check your credit score and banking statements regularly. This will alert you to any unlawful activity.
- Ensure all your passwords are secure.
- Delete emails or SMS messages from unknown senders to avoid phishing scams.
- Be mindful of the information you share on your social media accounts.
By following these practices, you’ll be well on your way to avoiding financial identity theft.
Saddock Is Here To Help You Through
Saddock Advisory is here to help in all matters regarding your credit health. Whether it’s before or after identity theft, we’re here to support you on your financial journey.
Schedule a meeting today to find out more.