Identity theft is a serious crime. Unfortunately, it’s a crime fuelled by modern technology and it has become increasingly common in recent years.
How do you protect yourself and your loved ones from identity theft? What do identity theft protection services actually do? Keep reading to answer all your frequently asked questions about identity theft.
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LifeLock is a identity theft protection service that offers a 30 day free trial and they protect your identity up to $1,000,000.
What is identity theft?
This may seem like a silly question, but it’s not: identity theft is one of those terms that a lot of people throw around without knowing exactly what it means. Specifically, identity theft is the act of using someone’s personal information (like a name, address, bank account number, credit card, driver’s license, Social Security number, health insurance card, etc.), without that person’s knowledge and using the assumed identity to commit fraud, theft, or other malicious activities.
How many Americans experience identity theft every year?
Most studies and reports suggest that between 8 million and 12 million cases of identity theft occur each year in the United States. However, ‘only’ two million victims of identity theft reported their complaints to the Federal Trade Commission’s Consumer Sentinel Network (CSN) in 2013 (Source).
Is identity theft actually rising every year?
This question is difficult to answer due to the general definition of identity theft. Another problem is the lack of reporting: not everybody calls the police when they realize they are notice identity theft. Here’s what we do know: in 2009, approximately 11.5 million Americans were victims of identity theft. In 2010, approximately 8.5 million Americans (3.5% of the population at the time) were victims of identity theft. That’s a drop of 3 million from year to year. In more recent years, most reports cite approximately 8 million to 12 million cases of identity theft each year in the United States, which means that the crime rate isn’t really growing – but it doesn’t appear to be shrinking either.
What is the most common form of identity theft?
The most common form of identity theft is government documents and government benefits fraud, which accounts for 34% of identity fraud cases as a single category. The second most popular identity theft crime is credit card fraud (17%) followed by phone or utilities fraud (14%) and bank fraud (8%). Employment-related fraud (6%) and loan fraud (4%) were also particularly common (Source).
How long does it take to solve identity theft-related problems?
Solving identity theft is rarely easy. It can be a very stressful process filled with setbacks and long-term implications. Fortunately, you’re not the first person to solve identity theft-related issues and you certainly won’t be the last. It is possible to totally clean identity theft from your record in under a day. If someone stole your credit card information, for example, then you may only need to contact your bank or credit card company and sign a mountain of paperwork. However, in more serious cases of identity theft, you may need to hire a lawyer to prove your innocence. Approximately 29% of identity theft victims spent more than a month solving their identity theft-related problems (Source).
How can children be victims of identity theft?
Unfortunately, children are popular identity theft targets. Until recently, identity thieves could predict upcoming Social Security Numbers prior to a baby’s birth. When a baby was born in a certain state, identity thieves would begin abusing that identity right away. Banks cannot view the age attached to a Social Security Number until that SSN is actually used (like when opening a bank account). As a result, children would grow up assuming their identity was clean, only to apply for a job at 16 and get turned down due to a mysterious criminal record, or get turned down for a loan due to mysteriously low credit. Since the predictive SSN system was only changed in 2009, children born before that date may have had their identities stolen.
What do identity theft protection services actually do?
Identity theft protection services protect misuse of your identity by notifying you as soon as any changes are made involving your identity. To do that, protection services:
- Sign you up for annual credit report statements from Equifax, TransUnion, and Experian
- Monitor public records for any suspicious changes involving your name
- Offer disaster recovery programs if your identity is stolen
- Insure you against identity theft while protected on the plan
- Issue credit freeze notifications to credit bureaus
- Monitor public databases like the Sex Offender’s Registry for any changes made involving your information
Essentially, identity theft protection services do three important things: they monitor public databases for fraudulent use of your information, they monitor your credit report for fraud, and they insure you against losses that occur as a result of identity theft.
Do the CEOs of identity theft protection companies really broadcast their SSNs to the world?
The CEO of LifeLock is named Todd Davis and is Social Security Number is 457-55-5462. I didn’t steal Todd’s identity: he broadcast that information to the world. LifeLock’s flashy advertising campaign posted Todd’s name on buses and billboards across America. It drew a lot of positive attention to LifeLock. Unfortunately, Davis has had his identity stolen at least a dozen times since Lifelock’s advertising campaign was launched and was often left with thousands of dollars in unpaid charges in his name that weren’t realized until months after his identity was actually stolen. To make matters worse, the Federal Trade Commission fined LifeLock for deceptive advertising practices to the tune of $12 million.
Yes, identity theft protection company CEOs sometimes broadcast their personal details to the world, but unfortunately, it doesn’t always work out.
What are the best ways to prevent identity theft?
You can prevent identity theft in a number of easy ways. Those easy ways include:
- Don’t give out your Social Security Number unless you absolutely have to. This tip becomes even more important online.
- Destroy all unwanted credit card offers that come in the mail. These are a major target for identity thieves. Even if it looks like a spammy marketing letter, it’s a good idea to destroy it.
- Destroy, shred, or burn all sensitive personal documents. Don’t just throw your personal stuff in the trash. You never know where that trash will end up. Maybe someone will be walking past a landfill and will see your latest credit card offer in a puddle by the side of the road.
- Don’t carry your passport, birth certificate, or Social Security card on your person unless you absolutely have to (like when traveling).
- Review your credit report every year to identity theft and credit abuse as soon as possible.
- Never give out personal information over the phone. Identity theft over the phone is particularly common these days – especially among the elderly.
- When denied a loan or credit card, find out why you were denied. An identity thief may have racked up tens of thousands of dollars in unpaid loans on your account.
Why should I sign up for identity theft protection?
Identity theft protection is a valuable service. Most protection services charge between $5 and $20 per month to monitor your identity and protect your credit. But is that price a good deal? Or should you spend your money somewhere else?
People sign up for ID theft protection to avoid losing a lot of money. If you could spend $10 every month to protect yourself from potentially losing thousands of dollars, would you spend that money? Possibly.
Identity theft protection services give people peace of mind. Instead of constantly worrying about your identity and shredding every single piece of mail you receive, identity theft protection helps you relax.
What is a credit freeze?
One of the most valuable services offered by identity theft protection companies is the ‘credit freeze’, which tells consumer credit bureaus to lock your credit account for a 90 day period. You can still access your credit using a PIN, but potential identity thieves will effectively be ‘frozen out’. Some protection services activate this freeze every 90 days to ensure complete protection, while others only activate it when fraudulent activity has been detected.
Why is credit monitoring a poor form of identity theft protection?
Credit monitoring is something anyone can do for free. Every American citizen is entitled to one annual credit report from each of the three major credit reporting bureaus. It’s recommended that you apply for your credit report every 4 months to ‘space out’ your monitoring and avoid any surprises.
However, credit monitoring has one obvious flaw: you only see identity theft after it happens. Once somebody has accessed your credit and applied for a loan (successfully or unsuccessfully) or opened a line of credit, that incident will appear on your credit report. At that point, damage has already been done and you now need to reverse it. This is why credit monitoring isn’t a totally effective form of identity theft protection. It’s a reactive defense, not a proactive defense.
How does identity theft occur?
Identity thieves can be anyone in your life. Sometimes, people know their identity thieves. In other cases, the victim and thief have never met. Identity theft can occur when a hacker bypasses website security to view customer information, or it can occur when unscrupulous relatives need money fast. From cleaning staff at work to trusted employees in positions of authority, identity thieves come from all walks of life and can commit the crime in many different ways.