6 types of identity theft impacting the digital market
Cyber attacks that lead to identity theft increased by 45% in 2020, amid the COVID-19 pandemic. According to the Federal Trade Commission (FTC), US citizens reported 4.8 million cases of identity theft and credit card fraud last year, but the actual number is higher because not all cases are not reported.
Overall, the FTC considers identity theft alone to cost the US government and US citizens a total loss of $ 4.5 billion.
Why are identity theft cases on the increase and how can you protect yourself in a world where everything is online?
The pandemic has created a perfect environment for crooks and fraudsters. People forced to practice social distancing have had to adapt to remote working and online shopping, which has exposed a wide range of vulnerabilities.
In addition, the world always runs on negative emotions (anxiety, anger, fear of the unknown) which can be easily exploited.
Today, the best method of prevention and protection is knowledge. When you know the modus operandi of someone trying to steal your confidential information, it is easier to stay away from risks and practice safe online browsing.
With that in mind, check out some best examples of identity theft that are successful in today’s market.
We’ll also talk in more detail about the six main types of identity theft schemes to be aware of:
# 1: Account takeover
It is one of the most common types of identity theft and occurs when a criminal takes control of your existing account (email, social media, online banking, etc.). They do this by breaking your password and will use the account in the most malicious way possible:
Harass your contacts with messages
Steal any sensitive information they can find
Empty your bank accounts
Make purchases on your behalf
File claims against your insurance policies
The list is much longer than that, but you get the idea. Fortunately, you can easily protect your accounts using a strong password and two-factor authentication. It is also recommended that you regularly check your accounts for any unusual activity.
# 2: New accounts
Cybercriminals today are smart enough to know how to extract personal information using data leaks (from companies you have entrusted your data to), social media accounts, and other clever methods. .
Once they have enough information, a common identity theft tactic is to open new accounts in your name. These can range from credit card applications to leases and even loans.
The bad news is that you won’t know about these accounts until there is enough debt accumulated to involve the authorities. However, by then it is already too late and you will have to unravel the mess.
This scenario is frightening because it puts all the blame and responsibility on the victim. Nonetheless, you can keep track of your situation by performing regular checks on your credit report with the three major credit bureaus in the United States (Experian, Equifax, and TransUnion).
# 3: online shopping fraud
Since the vast majority of people switched to online shopping early in the pandemic, e-commerce is a gold mine for cybercriminals. Basically, malicious actors hack into user accounts, change the delivery address, and make purchases using the stored credit card information.
They do this either by hacking into websites that do not have a strong cybersecurity system in place, or by targeting customers who shop online using unsecured Wi-Fi networks (like those in coffee shops, airports or during commuting).
To secure your online shopping, avoid saving your credit card information on e-commerce sites (although it is more convenient) and always use secure WiFi networks or a VPN solution with good encryption.
# 4: medical identification fraud
In this scenario, someone will use your ID to receive medical services using your health insurance. It’s bad for you for several reasons, but here’s the rundown:
Your credit will be damaged if medical bills are not paid (because you did not know them)
You will be struggling with medical bills that were not to your advantage
Your medical records will be updated with inaccurate medical information (since two or more people are using it), which means doctors will get the wrong medical history whenever you need treatment. It can be life threatening.
You may not be eligible for life insurance.
# 5: job identity theft
Another extremely lucrative method for cybercriminals is to sell your social security number and data to people who cannot find a job due to a criminal record or bad credit.
The fraudster will use your data to find a job and earn income, which will be reported under your name.
As a result, the IRS will want to collect taxes for the extra income and may even fine you for not reporting the income you didn’t know you were earning. Plus, increased income may put you out of reach of benefits.
Again, it is important to check your credit report. Study the inquiries section and check the data you don’t recognize.
# 6: biometric identity theft
Devices and accounts that use fingerprints, voice, and facial recognition as a method of authentication can help reduce the risk of identity theft. After all, this kind of data shouldn’t be so easy to replicate or steal.
However, cybercriminals proved the security specialists wrong when they started targeting companies that store biometric data. In addition, some of this data can be replicated using modern AI-based technologies (voice and face, for example).
As the world is heading into a future where biometrics will be the new username and password, these forms of attack are quite alarming. Plus, someone who can spoof your voice can easily impersonate you in a phone conversation or voice chat. Biometric identity theft is a whole new level of fraud and the consequences can be even more serious than we can imagine.
Right now, cybersecurity is already considered a national threat. Therefore, we begin to see involvement of governments and tech giants, but they are still at an early stage (talks and negotiations).
Unfortunately, this means that individuals and businesses need to focus more on cybersecurity and always be on their toes.
This article does not necessarily reflect the views of the editors or management of EconoTimes.