Identity theft and fraud cost businesses and their customers billions each year between direct monetary losses and the costs of dealing with ensuing issues. While the terms Identity Theft and Identity Fraud are related, they are not the same, despite often being used interchangeably. There are important distinctions, including how they impact victims.
Identity theft refers to the actual acquisition of personal data – typically for use in additional criminal activity, including selling that data to other criminals. Data can include social security numbers, credit card or bank account details, driver’s license numbers, passwords, and other personal information and details that can be later used to perpetuate fraud.
Identity thieves can use any number of methods for stealing personal information, ranging from the use of advanced hacking techniques and intricate scams to more basic burglary and dumpster searches. There’s been a high incidence of corporate network hacking over the past few years that has resulted in millions of customers’ information being stolen. Due to the sheer size of customer databases, corporate networks are a high-value target for thieves. In addition, because most people have a large amount of personal information stored on their mobile devices, they also have become a target because they can provide information for many different criminal uses.
Identity Fraud is the use of stolen identity data for criminal purposes. Criminals use identity information to make fraudulent purchases, open fake bank or credit card accounts, take out loans – often by using the data to create false identities supported by real data.
The impact of identity fraud extends beyond identity theft victims to the organizations where the information is used, including merchants, financial institutions, credit card companies, and others. In fact, everyone is affected by identity fraud, because organizations build the costs of fraud into their pricing structure, meaning every customer bears part of the burden.
Recovering from identity fraud can be a difficult task, even after it’s been identified and accounts have been closed. Accounts created by thieves can appear on credit reports for a long time, negatively impacting victims’ ability to secure loans for home or vehicle purchases or open new credit accounts.
Protecting Your Information
Individuals should regularly check their credit reports to look for any fraudulent accounts. If anything appears that hasn’t been authorized, contact the company, credit bureau, and authorities immediately to let them know you’re identity may have been compromised. Make sure you don’t leave your mobile devices anywhere, and be cautious about connecting to wireless networks. Also be wary about sharing any details that put your identity and accounts at risk – legitimate organizations won’t typically ask for sensitive information without you having contacted them first. If someone does, don’t hesitate to hang up and contact the institution on your own to verify the activity.
Businesses should make security a top priority and ensure they always have the latest protective measures in place for securing customer information. The latest security techniques, including voice authentication, make it much more difficult for criminals to gain access to customer accounts, even if identity information has been compromised.