Contributing Writer at Tally
June 8, 2021
The 2021 Identity Fraud Study by Javelin Strategy and Research found that 39 million Americans were victims of identity theft last year, with total losses soaring close to $56 billion. This monetary figure does not account for the hours one must spend fighting to recoup lost funds and expunging their credit report.
After reading these statistics, you are probably wondering, "How can I protect myself from identity theft?"
When it comes to identity theft protection, diligence and proactiveness are two of the greatest tools at your disposal. There are a few things that you can do to protect yourself from identity fraud, which can save you significant time and money in the long run.
This article serves as a guide to identity theft protection. We’ll explore the latest ways hackers try to steal your information and some methods to reduce the likelihood of falling victim to theft.
Identity theft "is when someone steals your personal information and uses it without your permission," according to the credit bureau Experian. The type of information commonly stolen includes both personal data and financial information, such as your:
Driver's license number
Social Security number (SSN)
Bank account number
Credit card information
Once a hacker has this information, they can open new accounts under your credit file. This includes new credit card accounts, bank accounts, and cellphone accounts. Failing to protect your financial information can impact your credit history.
Hackers can also take out an auto loan or rent an apartment in your name. In addition, hackers could file your tax return with the IRS and take your refund or receive medical care under your health insurance plan.
If someone steals your information, you'll need to flush out an identity recovery plan to try to recoup money lost and have fraudulent accounts removed from your credit file. Even if you take steps to recover your identity, there's a strong chance you’ll never receive full reimbursement.
With more and more of our day-to-day activity taking place online, cybersecurity remains a big concern when it comes to identity theft. Below are five common ways hackers try to steal your information.
A data breach occurs when cybercriminals hack into secure storage databases to access sensitive information. In 2010, there were a mere 662 data breaches in the United States. By 2020, that number was over a thousand.
Oftentimes, a data breach is out of your control. You can monitor what information you give to companies and take steps to protect your personal credit file (more on that below). But, there will still be companies that host your information, such as your name, email address, and date of birth.
Perhaps one of the worst data breaches of late occurred in 2017 when identity thieves hacked the credit bureau Experian, exposing the personal information and credit scores of 147 million people. This breach led to a settlement with the Federal Trade Commission (FTC).
Malware is a type of software that hackers use to access personal information on your computer, tablet, or mobile device. It allows hackers to steal your data or monitor your computer activity.
For instance, a hacker could track your keystrokes, allowing them to figure out your email address and password. From there, they can log in to your financial accounts.
The most common way cyber attackers install malware on your device is through false links. For instance, you receive an email that includes a web link. The link is not legitimate; it instead secretly installs malware software on your device without you knowing. Good antivirus software could help scan and identify malware on your devices.
Phishing attacks are similar to malware in that hackers use an email or text message that appears legitimate, looking as though it came from a reputable source.
The email will then prompt you to enter your sensitive information. However, the information is not for something legitimate. Instead, it's a scam, and you end up giving your information to a hacker.
If something seems suspicious, it's better to call the company or the person requesting the information directly. They can then advise whether the request was authentic. Also, remember that many financial institutions, like banks and credit card companies, will not request your personal information over email.
Public Wi-Fi networks are available at places like airports and cafes. It's easy to jump onto the network, and many people choose to do so because of the convenience. However, using a public Wi-Fi network could put your information at risk.
Hackers can tap into the network, allowing them to enter your computer and track your activity. If you log in to email, enter passwords, or type in a credit card or bank account number, the hacker can intercept it and steal your information.
If you use debit or credit cards, you should be mindful of card skimming. Card skimming occurs when hackers put a device over a card reader, such as at an ATM or gas station. The device is very inconspicuous, and you likely wouldn't notice it unless you knew what you were looking for.
When you swipe your card, the transaction still occurs as normal. However, the skimming device also reads the information from the card's magnetic stripe, immediately making you the victim of identity theft. It will store or transmit your credit card information. The fraudsters can then use your card information to make online purchases.
Checking your credit card statement is an excellent way to monitor for identity theft and skimming tactics. While you won't know for sure whether a hacker used a skimming device, you can catch if they've made unauthorized purchases on your account.
Now that you understand some of the common ways hackers try to steal your information let's learn more about identity theft protection. Though it may not be possible to prevent identity theft completely, there are some things that you can do to help protect your personal information.
If you do not review your financial information regularly, it could be months before you notice ID theft. You should routinely check your bank statements and credit card statements to ensure there are no fraudulent transactions. You should still do this even if you are using a credit card payoff app like Tally.
Additionally, you should also review your credit reports. You can receive a free credit report from AnnualCreditReport.com. You're entitled to one copy of your credit report per year from each of the three credit reporting agencies (Equifax, Experian, and TransUnion).
With routine credit monitoring, you can identify suspicious activity and catch if anyone has used your credit file.
If you don't plan on opening new accounts any time soon, you can put a freeze on your credit file, which a lender typically checks before opening an account. This prevents anyone from opening an account in your name, including yourself.
If your file is frozen, you’ll need to lift the security freeze before opening any new accounts in your name. Freezing your file can give you peace of mind knowing that even if someone did steal your information, they can't do as much with it since they can't access your credit. You'll need to file a freeze with all three bureaus individually.
There are identity theft protection services like LifeLock that will help protect your information. These services are designed to make identity theft monitoring very easy. You can easily lock your credit file without having to go through all three bureaus individually.
You also receive dark web monitoring services, which will scan the internet and let you know if your sensitive information is found online. These services will also protect your mobile devices.
If your identity is, in fact, stolen, your protection service will work with you to help remedy the situation. The company also acts as an identity theft insurance policy in that it will reimburse you up to the limit of your plan.
Below are a few other tips and tricks that can help protect your identity:
Shredding any documents that contain sensitive information .
Holding your mail with the post office when you go out of town.
Using a virtual private network (VPN) and avoiding public Wi-Fi.
No posting of sensitive information on your social media accounts.
Using different passwords for your accounts and considering a password manager to help you remember them all.
Never giving out your Social Security number to someone you don't trust.
With a bit of proactiveness and good practices, you can help protect yourself from becoming a victim of identity theft.
Cybersecurity has become a tremendous issue over the past few years and will continue to grow as fraudulent activity increases. Being proactive and diligent about protecting your information can save you time and money in the long run. If you are vigilant and put measures in place beforehand, you may reduce the likelihood that your information is stolen.
If you have credit cards, consider using a service like Tally to help streamline payments, allowing you to use your time doing things like monitor your credit reports and prevent fraudulent activity.