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ID Theft: How Does It Happen?

| May 18, 2018
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In today’s technologically advanced society, identity theft is a common and serious offense. The Identity Theft and Assumption Deterrence Act of 1998 defines identity theft as the following: when someone “knowingly transfers or uses, without lawful authority, a means of identification of another person with the intent to commit, or to aid or abet, any unlawful activity that constitutes a violation of Federal law, or that constitutes a felony under any applicable State or local law.”  

The Internet and automated teller machines (ATMs), now widely used for a variety of financial transactions, such as shopping online and making cash withdrawals, are often cited as two contributing factors to identity theft.  

If you’re concerned about your personal information getting into the wrong hands, familiarize yourself with the following ways a thief might obtain information with the intent to steal money or commit other crimes: 

Old-Fashioned Stealing. Years ago, if your handbag was stolen or if your wallet was pickpocketed, you probably only worried about the loss of cash. Today, these losses could result in thousands of dollars in fraudulent purchases with credit cards. Thieves also steal personnel files and customer data from companies for Social Security numbers and other information. 

“Dumpster Diving.” If you dispose of trash in a dumpster, others may have access to it. Thieves might “dive in” and easily find the information they need, via old bank statements, credit card receipts and bills, which can wreak financial havoc in your name.

Intercepting Mail. Thieves regularly watch mailboxes, waiting for the arrival of the next credit card pre-approval letter. They can then call the credit card company posing as the intended recipient in order to open an account. While you cannot stop all solicitations, you can choose to “opt out” of receiving some of these letters. Call 1-888-5-OPTOUT to minimize unsolicited mail and phone calls.

“Shoulder Surfing.” Shoulder surfing occurs when a thief lurks nearby while you provide personal information to another person or enter it into a machine. Typically, the thief peers over your shoulder and procures your information while you continue with your transaction.  

Hacking. Many people rely on the Internet to manage their personal finances. While it can be a useful tool for banking or paying bills, the Internet can also be a haven for prospective identity thieves. Entering your personal information into an unsecured website may allow an experienced hacker to obtain that information.  

Phishing: Some thieves also try to obtain personal information via email. They pretend to be financial institutions or companies and send spam or pop-up messages that ask you to reveal personal information. 

Pretexting: In a similar way, thieves use false pretenses to trick you into revealing your personal information over the phone. They may pose as a representative from your bank, insurance company, or other service provider. 

Skimming: After placing a special device on card processors and ATMs, thieves may be able to steal credit or debit card numbers when you process your card to make a purchase. 

Protecting Yourself 

If you become a victim of identity theft, it can be financially, as well as emotionally, devastating. With your personal information, a criminal might be able to open a credit card account and make fraudulent charges, or in more extreme cases, he or she may even assume your identity to get a job, file a tax return, and commit more serious crimes—all under your name. These are just some of the ways criminals may commit identity theft. Take steps now to protect yourself and your loved ones. For more details on avoiding identity theft, visit the Federal Trade Commission (FTC) online at www.ftc.gov.

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