Every day, you use your information to do many things, like log in to your bank and credit card accounts, email, social media sites, and other password-protected accounts.
Even though this information is often encrypted, that doesn’t mean it’s always safe. Criminals can steal your personal information and, by extension, your identity and use it to make money.
In 2020, 1.4 million reports of identity theft were sent to the Consumer Sentinel Network by the Federal Trade Commission.
This network keeps track of consumer fraud and identity theft complaints. In that year, government document or benefits fraud, credit card fraud, and loan or lease fraud were the most common types of identity theft.
“Our information is pretty much all over the place,” says Henry Bagdasarian, founder and executive director of the Identity Management Institute. “This information is being used to commit crimes and fraud.”
The good news is that you can help stop identity theft by doing some simple research and using free tools to keep an eye on your credit score and get alerts about your credit cards and bank accounts.
Experts also recommend signing up for a service that protects against identity theft. This is an extra layer of protection.
The U.S. Department of Justice says that identity theft, which is also called “identity fraud,” is when someone uses someone else’s personally identifiable information (PII) in a way that is dishonest or deceptive, usually to get money.
Identity theft can be done in many ways, such as through credit card fraud, account takeovers, hacking, phishing, social media fraud, impersonation, tech support fraud, and ransomware attacks.
PII is anything that can be used to find out who you are, like your Social Security number, date of birth, credit and bank account numbers, passwords, passport numbers, birth and death certificates, telephone numbers, medical ID numbers, and biometric data like fingerprints and scans.
Criminals can steal your PII and use it to use your credit cards, open new accounts in your name, take money out of your bank accounts, or use your health insurance to pay for medical care.
The Federal Trade Commission tells people to pay close attention to things like unexplained withdrawals from their bank accounts, calls from debt collectors about debts that aren’t theirs, and notices that their account information was stolen in a data breach.
Someone else can file a tax return in your name and get a refund. Your health insurance company might tell you that a claim was made for treatment you never got. These are signs that your PII might have been stolen.
Our information is all over the place, and many of us use passwords and account numbers every day to log in to our online accounts.
When we give out our PII, we run the risk of a criminal stealing it and using it against us. But there are ways to make identity theft less likely, and many of them are easy and free.
Signing up for an identity theft protection service is the best way to help stop identity theft. Even though an identity theft protection service can’t stop identity theft from happening, it can let you know right away if it does, which can help you limit the damage and get back on your feet.
For a monthly or annual fee, identity theft protection can help keep your personal information safe from being stolen. A subscription can include the monitoring of credit reports, financial accounts, medical information, social media activity, the dark web, and more. Identity theft protection companies also help you get your information back if it gets stolen.
Some give you up to $1 million in coverage for identity theft and give you access to lawyers or private investigators who can help you fix your credit and reputation. Most also give you a dashboard where you can see alerts and get in touch with customer service if fraud happens.
Besides signing up for a service to protect against identity theft, there are other things you can do to help stop identity theft. These things are:
1. Freeze your credit.
When your credit file is frozen, no one can look at it or ask for it. While your credit is frozen, no one, including you, can open a new account, apply for a loan, or get a new credit card. To put a freeze on your credit, you must contact each of the three credit reporting agencies: Experian, Equifax, and TransUnion.
You can freeze your account with the credit bureaus online, over the phone, or by mail. After you do this, they will give you a PIN or passcode that you can use if you want to temporarily stop the freeze or lift it. Freezing your credit doesn’t cost anything and won’t hurt your credit score.
Parents should think about putting a freeze on their kids’ credit files. Javelin Strategy & Research did a study in 2021 that found that child identity fraud costs U.S. families nearly $1 billion each year.
About 1 in 50 U.S. children have had their personal information stolen, and 1 in 45 have had their information leaked in a data breach. This can cost a family of four over $1,000.
Robert Douglas, an information and security consultant, and certified identity theft risk management specialist says that it’s a good idea to put a freeze on your child’s credit file and keep an eye on it as they get closer to their teenage years. “There are a lot of horror stories about parents who find out that their child’s credit has been hurt at a time when they need a good record, like when they want to get a student loan.”
2. Collect mail daily.
Some of the ways that thieves can use to steal your identity are very simple. For example, they can just take out of your mailbox your bank or credit card statements, utility bills, health care or tax forms, or pre-approved credit card offers. Thieves can also send change-of-address requests in your name to reroute your mail, so keep track of expected mail that doesn’t come. Also, put a hold on your mail while you’re gone.
3. Review credit card and bank statements regularly.
Reviewing your credit card and bank statements regularly is important because if someone has your credit card number or bank account information, they could make small changes to see if they can get away with it. These kinds of transactions can easily go unnoticed by you or your financial institution.
Find out when your statements are due and contact your credit card companies and banks if you don’t get them on time. Statistics from the FTC’s Consumer Sentinel Network show that credit card fraud is the most common type of identity theft.
4. Shred documents containing personal information before disposing of them.
Given the rise of phishing scams and online data breaches, dumpster diving might seem like an old way to steal personal information, but criminals still do it. Some people might be looking for valuables or furniture, but others might be after your information.
Keep your credit card and bank statements, utility bills, IRS letters, and other documents with PII in a safe place like a safe for a few months. Get rid of the rest. Bagdasarian says that he keeps his last three bank statements in a safe place and replaces them every month with new ones.
5. Create different passwords for your accounts
The FTC says that a safe password is long, hard to guess, and unique. Use different passwords for each account you have. Avoid using personal information like the last four digits of your Social Security number, your birthday, your initials, or parts of your name.
The FBI and the National Institute of Standards and Technology recommend using passwords with at least 15 characters because these are harder for a computer program or hacker to figure out. The FTC recommends that you choose security questions that only you can answer and not ones that could be found online, such as your ZIP code, birthplace, or mother’s maiden name. Also, don’t just say “chocolate” when they ask what your favorite dessert is. Check out How to Make Strong Passwords for more information.
6. Review credit reports annually
You can get free copies of your credit report from Equifax, TransUnion, and Experian once a year. Your credit score won’t go down if you look at your credit report, and it’s easy to do online. Also, the bureaus give you tools to help you keep an eye on your credit, like alerts that let you know when important changes happen. You should try to get your report from the bureaus at different times of the year so you can keep track of activity. At AnnualCreditReport.com, you can also get a free credit report once a year.
7. Install antivirus software
Hackers can’t get to the information on your computer or mobile devices if you have antivirus software. The FTC says you may have malware on your computer, which includes viruses, spyware, and other unwanted software, if:
slows down, stops working, or shows an error message.
- Slows down, crashes, or displays error messages
- Fails to shut down or restart
- Delivers pop-ups or other unwanted ads
- Sends you to web pages you didn’t search for
- Shows new, unexpected toolbars
- Changes your default web browser
- Drains its battery quickly
Criminals can hack into old software more easily, so keep your antivirus software up to date or set it to update itself automatically. How Does Antivirus Software Work? I will tell you more.
8. Enable two-factor authentication on devices and accounts
Verizon’s 2017 Data Breach Investigations Report says that 81 percent of hacking-related breaches are caused by passwords that have been stolen or made weak. Two-factor authentication (2FA) adds an extra layer of security to passwords. It can be turned on for email, social media, bank, and credit card accounts. To unlock an account, you need more than one way to identify yourself, such as a combination of:
- A PIN code or password
- A possession, like a smartphone or other device
- A biometric characteristic, like a fingerprint or voice print.
Even if someone steals your password, they can’t get into your account without your phone, voiceprint, or fingerprint. Signing into an account with a password and then getting a text message with a code you have to enter to get into the account is an example of 2FA.
9. Wipe electronics before donating
When you delete files from computers and other electronic devices like tablets, those files aren’t gone. Pieces of them still exist, and a data recovery program can put them back together until they’re overwritten by new data. This can be done with software that overwrites hardware or moves data from an old computer to a new one.
10. Opt out of prescreened credit card offers
Credit card companies often send pre-screened offers to open new accounts. If thieves can steal these offers and open accounts in your name if they get them by mail or email, Instead of putting these offers in the trash, shred them. Since your credit report doesn’t show the pre-screening that companies do to give you these offers, you might not know that an offer from your mail or email has been stolen.
How to Report Identity Theft to the Police
You can tell the FTC about identity theft, which will help businesses see that your identity was stolen. You also have the right to put a fraud alert on your credit report for one to seven years, ask that false information be taken off your report, and stop debt collectors from calling you.
If you know who did it or if the thief used your name or information during a police interaction, such as pretending to be you when they arrested you, you should file a police report for identity theft. Credit card companies or banks might ask you to file a police report if you say your identity was stolen and want them to look into it, stop the theft on your account, or pay for the money that was stolen.