Even though the masses of society have used the term identity theft for several decades, it is commonly a term that encompasses several abuses from its misinterpretation and constant usage without adhering to its original and precise definition. The exact definition of identity theft is the process in which an individual illegally obtains someone else’s identity, where he or she pretends to be another person in order to obtain any kind of benefit that is pertinent to the actual person. Identity thieves usually incorporate numerous malicious practices in order to obtain and assume a particular individual’s identity for monetary benefit or some other kind of benefit that is forgone from the victim.
Common Questions About Identity and Credit Theft
- What exactly is identity theft?
- Types of identity theft?
- How to reduce the risks of being a victim of identity theft?
- Effective identity theft protection aka ID theft protection companies
There are numerous extensions into the definition of what exactly identity theft is, some of these connotations involve the concept that identity theft is a massive invasion and even obstruction of personal information in order to acquire several key factors that can securely identify and be recognized as the actual individual in many circumstances in front of a particular entity. These entities can vary from being financial institutions, banks, lending agents, retailers and even family members in some cases.
Identity theft originated in the early 1960’s where there was a high increase in the number of people who faked personal identifiable information such as ID cards, driving licenses, passports and other means in order to obtain immigration to certain countries and cities across the world. This was actually an after-effect of World War II when millions of people in Europe saw themselves affected with devastated economies and the need to immigrate to other countries. Many historical records also cite identity theft in the late 18th and 19th century where certain men would take over the identity of the soon-to-be-wed boyfriends in order to obtain marriage with highly attractive women whom where usually from a wealthy family.
The concept of identity theft and its definition have changed dramatically over the past decades to the point where identity theft is no longer seen as a simple theft of personal information or faking the identity of a man in order to marry a particular woman. Identity theft is now seen as a pervasive crime which involves the theft of credit card numbers, public and private records, social security numbers and other types of personal identifiable information which adhere to certain economic theft in the long run.
Modern identity theft involves certain practices that affect not only the victims but also the whole society as a whole and several key industries within the economy, causing disruption in the progress of certain developmental areas, hardships for victims, felonies, imprisonment and other negative effects that procure many constant struggles for hundreds of indirect victims.
Types of Identity Theft Widely Practiced Today
In almost 90% of all cases, identity theft is committed in order to obtain some kind of monetary or material benefit that directly harms the victim in numerous ways and benefits the thief in numerous ways as well. Certain modern practices of identity theft have become so common that they are often easy to spot and control when done at an earlier stage. However, identity thieves have acquired a keen and profound ability to overpass these barriers with sophisticated and complex practices that are beyond the control of most law enforcement agencies.
Several of these theft practices are outlined below with the different methods that are used and how the entire process of identity theft is initiated from the start to the beginning:
Credit Card Fraud
One of the biggest identity theft practices today involves the theft of credit card numbers and its secure information. Thieves can obtain credit card information through various ways; the most common type of method is through phishing. Phishing is the practice of creating fraudulent and fake websites of bank or retail institutions that clearly look as if they were real and legitimate but they actually aren’t. Individuals may not notice the legitimacy of the website and may input credit card information, including the full number, their name, security access code and the CVS number which is usually the number located at the back of the card.
Once all this data is put in, the website accumulates all this sensitive credit card information and starts gathering it from multiple accesses from hundreds, thousands or even millions of users every single day. Thieves usually gather a secure database online or even a written word processed document where reflects the full complete name of the owner of the credit card, the full credit card number, billing address, security codes and the CVS code. If all this information is legitimate and correct as acquired, thieves can then take the identity of the owners of the credit cards and commit fraudulent purchases online or over the phone.
Another method of acquiring credit card information is with the usage of contactless chip technology and plastic cloning which captures the information integrated to the magnetic strip of the actual credit card. This method requires sophisticated gadgets and transmitters that capture the credit card information when it is swiped through a POS terminal or when it is inserted to an ATM. The transmitter can then transfer the information to a software and place it on another completely different credit card. Identity thieves use this method to avoid prosecution since it is a highly advanced method that requires expertise in the transmission of data through transmitters and computer software.
Database Administration Hacking
Thousands or even millions of companies, businesses and corporations have thousands or even millions of records securely stored on their databases, these records hold valuable information such as full complete names, home and work addresses, financial statements, bank account numbers, credit card numbers and other personal information that is of key interest to identity thieves for a variety of reasons.
First of all, these information can be utilized to do several things that a legal U.S. citizen can do, such as apply for a driver’s license, open bank accounts, work for an employer, etc. A large number of people present in a country may or not hold valuable and verifiable information that may permit to do these actions and subsequently incorporate the ability to steal this information in order to do these actions in the stolen identity of their victims.
The methods used for database administration hacking are quite complex, but they generally entail the manipulation of servers, database controls, programming languages and certain security administrative features. Hackers can manipulate and create programs which can infiltrate to these databases and mimic certain commands within the respective algorithms. Weak systems can be manipulated very easily and they are often attacked in order to obtain this verifiable information. Identity thieves can often resell this information, use it for fraudulent purposes or use it to blackmail the victim on behalf of someone else within black market activities.
Social Security Fraud
One of the biggest identity theft methods and the one that is most disruptive is to steal someone else’s social security number through various methods. The first method involves the appropriation of sensitive personal documents such as tax returns, bank account information, payroll slips and other types of documents where the social security number is shown. Identity thieves spy on these documents in order to verify that the social security number is valid and has a worthy value of usage.
The identity theft through the social security acquisition by thieves usually occurs whenever the thief has access to these types of documents. Worthy usage refers to the amount of capital in terms of economic well-being and credit history that the individual victim can have, thieves usually target wealthy individuals with good credit history and scores so that they can use that social security number to request lines of credit in retailers, purchase cars, facilitate lending activities from financial institutions and even purchase a property at any given time.
If the social security is stolen and the information is legitimate, thieves can assume the identity of the victim and they can literally take everything out of the victim in terms of money and assets, usually leaving the victim with massive amounts of debt and at the brink of bankruptcy due to the incredible amounts of assets that were acquired under their name and the failure of payments toward eliminating those debts from the respective acquisition.
Social security fraud is a type of identity theft that has the most detrimental effect within society as a whole due to the inability to secure financial goals and obtain lines of credit to achieve certain economic goals throughout each person’s lifetime. Apart from these effects, the identity theft of social security numbers is a growing concern toward the national security and integration of legitimate and democratic government systems within a nation.
Medical Identity Theft
A lesser known form of identity theft involves the malpractice to undergo certain manipulations of medical records in order to obtain a desired medical procedure meant for another person, or to pay less in medical fees in the long run due to the control of these records. Even though medical identity theft is not that prevalent due to law restrictions into the access of these records, there have been certain cases where people have died when they have been mistakenly confused with other patients and received therapy, treatment, surgery or any other type of medical service that was not right for them.
Other cases have been noted where patients themselves can steal these records, manipulate them and change several clauses in which the doctor or hospital is required to charge less in terms of fees for the medical services already provided.
Insurance Identity Theft
Who wouldn’t like to receive a compensatory sum of insurance funds for a claim that never happened or that actually happened but you were not supposed to be the beneficiary? This is the precise nature of insurance identity theft. Thieves often take access and control toward certain insurance records in order to establish a claim and assume that they are the beneficiaries when they actually aren’t. The claims get processed based on almost any type of insurance and the funds and benefits are received by the thief and not by the beneficiary.
While this form of identity theft is also less known and practiced, there have been several cases around the world where it has disbursed thousands of insurance companies from auto insurance to life insurance; making multi-million dollar claims that were not directed toward the actual beneficiaries due to the control and manipulation of these records.
Several other cases within this category of identity theft include the false claims of thieves which are processed as legitimate and truthful; they receive the compensation when no type of claim ever happened whatsoever.
How to Reduce the Risk of Being an Identity Theft Victim
While taking several precautionary means to avoid identity theft may be helpful in the long run, there are several key tips that can be followed in order to avoid completely with a 90% accuracy in the majority of scenarios:
- Never store your personal information, credit card account numbers, bank account information or any information thereof in online profiles such as the profiles of your favorite retail stores, eBay, PayPal or any kind of website regardless of its popularity, brand, recognition or placement within the market.
- Never show your credit card, copies of your credit card or information about your credit in general to anyone regardless of who it is.
- Set up alerts and notifications with your bank so that you can know when you have used your credit card and where you have used it.
- Never use ATMs of POS terminals that are defective, sketchy or shady in any sense.
- Always destroy all documents that show your social security number as soon as you do not longer need them.
- Never give out your social security to anyone unless it is required for a credit check verification or other trustable agency that needs it for verified and legitimate reasons.
- Stay alert to phishing sites that want to capture your personal data and information.
- Always keep copies of your medical records and verify each clause as stated, do the same with insurance records, claims, bills and payments.
- Remove personal identifiable information about you on the internet, including but not limited to social networking sites, blogs, websites and even video sharing websites.
- Never give out your personal information or credit card number over the phone.
- Sign up for identity theft protection services available for certain fees.
The Most Effective Identity Theft Protection Methods
Today, due to the technological development affecting almost all fields of activity, a great deal of personal information is used by public or private institutions not only in the public services registers, but also in statistic reports and various financial transactions. Everything is done with the help of the computer, all the necessary data being transmitted over the Internet.
Since this is a public domain, and there are quite a few surfers out there capable of overriding security systems and breaking passwords, anyone’s information, like social security number or bank account numbers, can land in the wrong hands and be used for the wrong purposes, with devastating consequences for the person whose identity is stolen.
First of all, that person’s financial stability is at stake, if the thieves access the bank accounts and transfer the money. If that person’s information is used to obtain loans or credit cards, the theft may be followed by the accumulation of heavy debts and by negative effects on one’s credit score. Putting all these considerations aside, sometimes, things get out of control, and an innocent person is wrongfully accused of serious crimes that somebody else committed using a stolen identity.
In the light of all these, identity theft protection measures are absolutely necessary. There are still enough people who hope that, if they keep all their important documents safe, somewhere out of sight and reach, nothing bad will happen. Unfortunately, the data in question can be accessed online, in public files, and thieves have some quite ingenious methods to get what they need.
One example are the junk mails, fake crediting offers or so called confirmation messages sent on the behalf of certain banks, lenders or brokers, that request the receiver to submit or confirm personal information. Some have already gotten familiar with these fraud attempts and ignore them, but there are quite a few naives out there who still fall in the traps.
That is where using an identity theft protection service can make the difference.
Benefits of the Identity Theft Protection Services
- Efficient data protection – All services have special features that ensure the safekeeping of any personal information. For instance, they can protect not only basic identification data, such as social security numbers, but also other documents regarding medical or life insurance policies that can also be used by identity thieves in their criminal activities.
- Security around the clock – The installation of services in this category involves placing fraud alerts, considered basic elements in the identity theft prevention process, due to the fact that they help detecting and blocking any suspect transactions or loan applications made on the name of the service’s user, or on that of the people he chooses to protect.
- Assistance in stolen data recovery – Not all of the companies offer this kind of support, but it is good to know that, should anything happen, someone will take care of formalities like replacing one’s documents and making sure one’s credit score is not affected.
- Excellent customer service – Obviously, there are some exceptions to the rule, but, generally, these services are backed by 247 support, so someone is always at the other end of the line to assist users with any information or advice they may need, either regarding the functioning of the ID theft protection they chose, or regarding the procedure to be followed in case the fraud alert is triggered or some suspicious transaction is initiated on their behalf.
- Various useful additional features – Each of these identity theft protection programs has its particularities, extremely helpful in fighting this type of crimes. These features are usually the choice criterion for most users, but also the ones that influence the price of the systems, so they should be reviewed carefully.
Identity Theft Prevention Services – Costs and Subscriptions
Most of the companies that provide the identity theft protection services have both monthly and yearly subscriptions. Depending on their financial possibilities and on the security level they desire for their personal documents and information, users may have to pay a monthly fee between 9 and 12 dollars for one person, but no more than 120 dollars for a year’s subscription.
Is it affordable? Is it too much? Every person has his or her own standards of evaluation. The truth is that part of us wants to believe nothing bad will ever happen, and would rather avoid paying the fee. However, there is the other side of the story, making us wonder “what if it does happen to us?”, “What if the thieves don’t get caught?”, “What if the money they steal cannot be recovered?”, “What if the identity theft cannot be proved and we have to pay the consequences?”.
From insecurity to losing a lifetime’s savings, getting in huge debts, ending up with poor credit score and even criminal charges, these are all reasons why the usage of an identity theft protection company should be considered and accomplished as soon as possible, especially with so many offers available on the market.
There are video games and clothes that cost more than the monthly subscription. You may leave this money as a tip to the guy washing your car or to the waitress serving your coffee. Is your safety and that of your family worth less than that? Isn’t your good name worth protecting? And what’s the worst that can happen if you use the ID theft protection company? You decide you don’t need it or you cannot afford to pay for it and you cancel the subscription? No headaches, no additional expenses involved, so basically no reasons not to have an identity theft prevention service installed as soon as possible, if not for the protection it offers, at least for your peace of mind.