Is Someone Using Your Identity? An Expert Guide to Detecting and Preventing Identity Theft

Identity theft has become a disturbingly common crime in our digital age. According to the latest figures from the Federal Trade Commission, identity theft reports skyrocketed to 4.8 million in 2020, up 45% from 3.3 million in 2019. That equates to about 1 in 15 Americans having their identities stolen each year. As a cybersecurity professional focused on safeguarding sensitive data, I‘ve seen the devastating impacts first-hand. Thankfully, you can take proactive measures to detect identity theft early and minimize the damage.

Understanding the Different Types of Identity Theft

Identity theft occurs when a criminal obtains your personal information and uses it for their financial gain. It can take many forms:

• Financial identity theft – A thief uses your credit card number, bank account details, or other financial information to make unauthorized transactions or open new accounts in your name.
• Medical identity theft – Someone uses your health insurance information to fraudulently receive medical services, prescription drugs, or medical equipment.
• Criminal identity theft – A criminal gives your personal information to law enforcement during an investigation or arrest, leaving you with a false criminal record.
• Child identity theft – A scammer steals the Social Security number of a minor child, often to open credit accounts or apply for government benefits. This type of fraud can go undetected for years.
• Synthetic identity theft – This emerging threat involves combining real and fake information to create a new identity, which is then used to defraud creditors and government agencies.

How Do Identity Thieves Get Your Information?

Skilled identity thieves have many tricks up their sleeves for obtaining your sensitive personal data:

• Data breaches – Hackers infiltrate a company‘s network and steal customer databases containing personal information like Social Security numbers, account numbers, and login credentials.
• Phishing scams – You receive a legitimate-looking email that tricks you into entering your personal information or downloading malware onto your device.
• Malware – Cybercriminals plant malicious software on your computer or phone to steal your data. Malware often hides in email attachments, pop-up ads, and illegitimate mobile apps.
• Physical theft – Thieves dig through your trash for unshredded documents, steal your wallet, or intercept your mail to collect your personal information.
• Insider threats – Rogue employees may misuse the access they have to your data at work, doctor‘s offices, schools, or other institutions.

Warning Signs Your Identity Has Been Stolen

Red flags that indicate a criminal may be using your identity include:

1. Accounts you didn‘t open and purchases you didn‘t make appearing on your credit reports or statements
2. Unexplained withdrawals from your bank account
3. Merchants refusing your checks or credit cards
4. Missing bills or statements in the mail
5. Collection agency calls about debts you don‘t owe
6. Unfamiliar accounts or inquiries on your credit reports
7. The IRS notifying you that more than one tax return was filed in your name or that you have income from an employer you don‘t work for
8. Getting medical bills for services you didn‘t receive
9. Having your legitimate account login credentials rejected
10. Receiving notice that your information was compromised by a data breach

10 Steps to Check for Signs of Identity Theft

With so much of our sensitive information available online today, we all need to be proactive in monitoring for signs of identity theft. Here are the top 10 ways to detect identity theft early:

1. Check your credit reports – You‘re entitled to a free credit report from each of the three major credit bureaus (Equifax, Experian, and TransUnion) every 12 months at AnnualCreditReport.com. Scrutinize your reports for unauthorized accounts or errors. Consider spacing out your requests to get a free report once every four months.

2. Review your credit card and bank statements – Carefully review your statements each month for unauthorized charges or withdrawals. Don‘t forget smaller accounts like PayPal, Venmo, or CashApp. Notify your financial institution right away if you spot fraud.

3. Sign up for identity theft monitoring – Consider enrolling in an identity theft protection service that monitors your credit 24/7, alerts you to suspicious activity, and provides insurance and recovery assistance. Our top picks include:

4. Be alert for missing mail – If expected bills or statements don‘t arrive, follow up with the sender. An identity thief may have filed a change of address to intercept your mail.

5. Check your Social Security earnings statement – Create an account at ssa.gov/myaccount to review your Social Security earnings record. If you spot income from an employer you never worked for, someone may be using your Social Security number for employment.

6. Review your medical bills and insurance statements – Examine your medical bills and insurance explanation of benefits for any services or prescriptions you didn‘t receive. Notify your insurance provider if you suspect medical identity theft.

7. Watch for strange notices from the IRS – The IRS will notify you by mail if it receives a suspicious tax return in your name or if you‘ve been paid by an employer you don‘t know. Respond promptly to resolve the fraud.

8. Keep tabs on your utility and phone accounts – Thieves may try to open utility accounts or get new mobile phones in your name. Monitor your legitimate accounts and follow up on any unrecognized charges or activity.

9. Be wary of debt collectors – If you get collection agency calls about accounts you never opened, ask the collector for written verification of the debt. Dispute the fraudulent account with the original creditor and credit bureaus.

10. Trust your instincts – If something just doesn‘t feel right, like your bank declining your credit card or getting calls about an overdue balance you don‘t recognize, don‘t ignore it. Small discrepancies can be early indicators of identity theft.

Know Your Rights Under Federal Law

Several federal laws provide important protections for identity theft victims:

• The Fair Credit Reporting Act (FCRA) gives you the right to dispute fraudulent information on your credit reports and requires creditors to provide a copy of application and transaction records related to identity theft accounts.
• The Fair Credit Billing Act (FCBA) limits your liability for unauthorized credit card charges to $50 if you report the loss or theft within 60 days of receiving your statement.
• The Electronic Funds Transfer Act (EFTA) limits your liability for unauthorized debit card or electronic account withdrawals to $50 if you report it within two business days, and up to $500 afterwards.
• State laws – Many states have their own identity theft laws that provide additional protections. Check with your state Attorney General‘s office or consumer protection bureau.

What to Do If Your Identity Has Been Stolen

If you‘ve spotted signs of identity theft, take immediate action with these six steps:

1. Place a fraud alert on your credit reports. Contact any one of the three credit bureaus to request a free, one-year fraud alert, which requires creditors to verify your identity before opening new accounts. You can renew the fraud alert after one year.

2. Consider a credit freeze. For even stronger protection, place a credit freeze on your reports with each bureau. A freeze blocks access to your credit unless you unfreeze it using a PIN. Thanks to federal law, freezes are now free.

3. Close fraudulent accounts. Contact the fraud department of each business where an account was opened in your name. Explain you‘re an identity theft victim, close the account, and ask them to send you a letter confirming your lack of responsibility for the account.

4. File an identity theft report with the Federal Trade Commission at IdentityTheft.gov. Based on the details you provide, the FTC will create an Identity Theft Report, which helps prove to businesses that someone stole your identity and guarantees certain rights.

5. File a police report. Bring your FTC Identity Theft Report to your local police department and file an official report. The police report, combined with your FTC report, forms an Identity Theft Report, which entitles you to additional legal rights.

6. Dispute fraudulent charges and information. Write to creditors and debt collectors to dispute any fraudulent accounts, charges, or collection notices tied to your identity theft. The Consumer Financial Protection Bureau has excellent sample letters.

How to Protect Yourself from Identity Theft

While you can‘t completely prevent a determined criminal from stealing your identity, you can safeguard your personal information and make it much harder for them to succeed:

• Shred it – Cross-cut shred sensitive documents before disposing of them, including bank statements, credit card offers, paid bills, and prescription labels.

• Shield it – Don‘t carry your Social Security card or more credit/debit cards than you need. Never share sensitive data like account numbers or passwords over unsecured channels like email or text.

• Freeze it – Consider placing a preemptive credit freeze on your credit reports so thieves can‘t open new credit in your name (just remember to unfreeze before you need to apply for credit).

• Secure it – Use strong, unique passwords on all your accounts and enable two-factor authentication wherever available. Avoid using unsecured WiFi networks.

• Update it – Keep your computer, phone, and tablet operating systems and anti-malware software updated to patch the latest security vulnerabilities.

• Monitor it – Regularly check your credit reports, financial statements, and insurance explanations of benefits for any signs of suspicious activity.

• Inspect it – Be alert for phishing emails and texts trying to trick you into revealing sensitive info. Hover over links to preview the true URL before clicking. When in doubt, go directly to the alleged sender‘s official website.

• Insure it – Consider identity theft insurance, which reimburses certain out-of-pocket expenses related to resolving identity theft, like legal fees, lost wages, and notary fees. Some employers and insurance companies offer this coverage.

Real-World Identity Theft Nightmares

To underscore the devastating impact identity theft can have, here are some real (albeit extreme) identity theft victim stories:

• Axton Betz-Hamilton discovered her identity had been stolen at age 19 when she applied for college and found $500,000 in fraudulent debt in her name. It took 16 years of battling creditors and struggling with her credit before she discovered the perpetrator was her own mother.
• John Harrison was wrongfully arrested for crimes ranging from robbery to murder committed by an identity thief. Harrison spent two years in jail before he was able to clear his name.
• Jessamyn Lovell was shocked to discover a woman had been impersonating her for years, even getting into car accidents and qualifying for welfare benefits in her name. Lovell spent years untangling the damage to her credit and reputation.

The Bottom Line

In our digital world, identity theft is an unfortunate reality we all must face. As these stories and statistics show, the road to recovery can be long, stressful, and costly. That‘s why detecting identity theft early is so critical. By following the proactive monitoring steps outlined here and knowing your rights and resolution options, you‘ll be better equipped to defend against this growing threat. Remember, when it comes to protecting your identity, an ounce of prevention is worth a pound of cure.