What is identity theft and how does it happen?

05/26/2021
What is identity theft and how does it happen?

Share


Identity theft is a criminal offense that damages victims’ finances and reputation

There are multiple types of identity theft and ways criminals can steal your personal information.

Identity theft is a criminal offense that damages victims’ finances and reputation

Identity theft is the crime of obtaining another person’s financial or personal information in order to use their identity to commit fraud.

Identity theft occurs when someone steals your personal information, such as your Social Security number, credit card details, or bank account number. The identity thief then uses your personal information to commit a fraudulent act, such as making an unauthorized purchase or transaction.

Identity thieves typically make outrageous purchases using your identity, racking up debt and damaging victims’ credit rating, reputation, and finances.

Identity theft is worsened by the fact that victims are unaware their identity has been stolen. Only when they are denied credit products for bad credit scores and creditors start calling out of the blue, do they realize their identity was stolen.

Types of identity theft

Identity theft takes different forms. However, they all involve using another person’s personal details to commit fraud. Let’s take a look at the different types.

1. Social Security Identity Theft

A Social Security number (SSN) is the foremost identifier of individuals in the United States. With your SSN, perpetrators can apply for new credit cards and loans. Then they incur astronomical expenses without paying the outstanding balances.

With your SSN, identity thieves can even obtain multiple kinds of benefits. 

2. Criminal Identity Theft

With this type, the thief claims to be someone else during an arrest by providing the victim’s personal details as theirs. This is typically done to avoid a summons, avoid an arrest on conviction records, or prevent a warrant issued in their real name. 

3. Financial Identity Theft

This involves using a victim’s identity or personal information to fraudulently gain credit, goods, services, and other forms of financial benefits. It is the most common form of identity theft. 

4. Tax Identity Theft

An identity thief uses a victim’s personal details and SSN to file a fake tax return. This is done in the victim’s name, but the perpetrator actually collects the tax refund.  

5. Child Identity Theft

This type of identity theft uses a child’s personal details such as their name or SSN to obtain benefits, including everything from obtaining a residence and loans to gaining employment and avoiding arrest on outstanding warrants.

6. Synthetic Identity Theft

A criminal creates a new bogus identity by combining real, stolen, and fake details. The bogus identity can then be used to create multiple fraudulent accounts, make various fraudulent purchases, and steal funds from credit card companies or other creditors who make funds available to the fake person.

How does identity theft happen?

Identity theft includes two elements: the acquisition of personal data and the use of the stolen identity for dishonest purposes. Here are some ways perpetrators acquire victims’ personal data:

  1. Dumpster diving, which involves identity thieves digging through trash to find bank details, tax information, credit card statements, and other personal details.
  2. “Phishing” for electronic information using text messages, websites, and emails programmed to steal delicate information.
  3. Stealing electronic records through data breaches. Admittedly, identity theft has become more sophisticated and computerized in recent times. Data breaches in companies and government institutions expose countless people’s confidential details.
  4. Stealing of wallets or purses to obtain bank cards, credit cards, and other forms of identification.
  5. Fetching details from an ATM by attaching an electronic device to the ATM. The device proceeds to steal the details in the credit or debit cards.
  6. Stealing victims’ personal details on insecure websites or local networks.
  7. Sourcing personal details from an insider who has access to confidential information in an organization. 

With this identity theft information, consumers can have a better idea of what it is and watch out for irregular activities on their credit report. If you have an identity theft issue, don’t hesitate to contact us. We’ll help you sort it out in accordance with the Federal Trade Commission’s guide.       


Contact Us

+1 877-615-1725

info@consumerattorneys.com

Blog

Related Articles

08/07/2021


What are credit reporting errors?

Your credit report can contain some mistakes

06/19/2021


What is a mixed file?

A mixed file can cause your credit score to plummet

06/10/2021


What’s the difference between a FICO score and a credit score?

A FICO score can actually impact your credit score.

06/08/2021


What are considered good credit scores?

Credit scores have different rankings and meanings

05/28/2021


Real Stories About Credit Reporting Errors

Consumer Attorneys help clients sort out credit reporting issues

05/24/2021


How has COVID-19 impacted credit reporting errors?

Amongst the many issues created by the pandemic, credit reporting mistakes are multiplying in the wake of new legislation and policy.

05/19/2021


How Long Credit Reporting Disputes Take

It may be quicker than you think with the right partner

05/17/2021


What’s the difference between a credit score and a credit report?

You may use the terms "credit report" and "credit score" interchangeably, but they're very different.

02/01/2021


What Does “Mixed” Mean on a Credit Report?

Sometimes a consumer’s credit report can get dragged down by dead weight ... literally.

08/31/2021


How does medical identity theft occur?

What to look out for to make sure it doesn’t happen to you

08/10/2021


Distinguishing credit card fraud from identity theft

The two are not the same thing

06/18/2021


The top 10 states with the most identity theft

Some states have more cases of identity theft than others

05/28/2021


What is at risk when someone steals your identity?

The dangers of identity theft

View all articles