Recently, Javelin Strategy & Research, the industry standard-bearer on identity trends, issued its annual identity theft report, which found that identity theft cases jumped 16 percent over the past year, very notably the highest since the firm began tracking identity fraud in 2004. In fact, 2016 was the biggest identity theft year—ever.
The report also found that some of the more complicated-to-resolve types of fraud are occurring more frequently. For example, account takeover fraud. This happens when someone takes control over your existing checking, savings or credit account, typically by stealing and changing your online password or otherwise altering your information. The report found that these fraud victims pay an average of $263 out of pocket and collectively spent 20.7 million hours in 2016 to resolve fraudulent activity, In addition to a financial toll, there’s an emotional component of resolving identity theft that comes from dealing with seemingly endless paperwork and long hold times on the phone.
Another kind of fraud, where someone opens a new financial account in your name, for example a credit card or payday loan, is also on the rise. Unfortunately, if you’re a victim of this crime, you are likely to be alerted to the problem when you read your credit reports or are contacted by debt collectors, which means that a significant amount of time may have passed between the fraud and your discovery of the fraud.
What you can do about identity fraud
Fixing identity theft is difficult, and it’s mentally exhausting to prove the activity is not authorized by you to each and every creditor and loan agency. The good news is that there are companies that provide services that can help, including companies like LifeLock, where I work. At LifeLock, we’re committed to helping give our more than 4.5 million members the peace of mind that comes with knowing we’re there to help protect against identity fraud.
A big part of protecting your personal information is proactivity. Being aware of your digital habits and frequently reviewing account security settings will help boost your privacy across your social, financial, and retail accounts. In addition, using multi-factor authentication, using strong passwords and, when shopping online, always making purchases from secure, verified websites will lower the risk of someone compromising your identity.
If you suspect fraudulent activity, contact the credit bureaus, set up fraud alerts, and consider placing a temporary freeze on your credit. These steps won’t stop all potential fraud, but they can help. If you, like many people, feel overwhelmed by all of these steps, you can also look into using an identity theft protection service that takes care of it for you. Finally, immediately reporting suspicious activity to your financial institution or law enforcement not only empowers you to take matters into your own hands, but it also helps creditors do their part in helping stop pending activity and, possibly, help catch the criminal. This happened to a LifeLock member who literally took matters into her own hands to catch her thief and brought them to justice.
Mary’s Story—Identity Fraud In Real Life
Mary’s story begins before she became a LifeLock member when she was called by her credit card company to verify a new account that had been opened in her name. After a few weeks of ongoing calls from creditors, Mary checked her credit report and was shocked to find that new, fraudulent credit card accounts had been opened in her name. In addition, her credit score had plummeted.
It’s important to thoroughly look through everything in a credit report when fraudulent activity has occurred. Discovering inaccurate contact or mailing information can tip you off to identity theft and help you prove your case to creditors.
In Mary’s case, the phone number and address on the credit report did not match her actual information. It was then that Mary knew she was a victim of identity theft. She put a freeze on her credit and corrected her contact information. But the fraudulent activity didn’t stop there.
That’s when a friend told Mary about LifeLock, and Mary decided to become a member. As part of the LifeLock membership, we offer US-based Identity Restoration Specialists who work with members one-on-one to help restore credit and identity while sending alerts of potentially suspicious activity to members who then approve or deny authorization.
One day, LifeLock sent Mary an alert that someone was attempting to take out a car loan in her name.
Mary immediately reached out to the car dealership to let them know what was happening. It turned out the identity thief was still there, trying to close the deal. The dealership called the police, and officers were able to make an arrest on site, after the thief fraudulently signed the papers. What’s more, police found loads of documents in thief’s car with other victims’ personal information, as well as credit card skimming devices and stolen credit cards.
Mary’s story has a happy ending, but for many who are victims of fraud, identity theft is an ongoing nightmare. The fight against identity fraud is ongoing, and making progress includes educating creditors, retailers, financial institutions, law enforcement, and even policymakers on what criminals use to access individual’s personal information and how each can help protect consumers.
In order to successfully combat criminals, we must come together to close security gaps and be more cautious of our daily digital habits.
Posted by Neil Daswani, chief information security officer, LifeLock.