Identity Theft - MyLife Financial Guides

As one of the fastest growing crimes in America, identity theft can cause a great deal of financial hardship and emotional devastation.

What is identity theft?

Identity theft is a crime in which someone steals and uses another person’s personal data, such as full name or Social Security Number, to commit fraud or deception, typically as a method of economic gain. The identity thief can use your information to obtain false lines of credit, file taxes or get medical services. They could even hide behind your name in a legal matter, leaving their victim with a false criminal record. These acts can be damaging both financially and emotionally. Getting to know the common types of theft and strategic privacy practices, however, can help protect you from falling victim to the crime.

Financial identity theft

There is a wide range of identity thefts that can affect you. The most common and well-known form is financial identity theft. This occurs when thieves use stolen credit cards and bank information to make fraudulent purchases. Oftentimes the thief will withdraw cash or max out accounts. They can also use the victim’s identity to take on loans and apply for new credit cards.

Tax-related identity theft

Identity theft can also affect your taxes. Tax-related identity theft occurs when your name and Social Security Number are falsely used to file tax returns with the IRS claiming a fraudulent refund.

Medical identity theft

A criminal could also steal your medical information, such as insurance member numbers, to receive fraudulent healthcare services. By using the victim’s medical coverage, thieves can introduce false information onto their medical records and leave them with erroneous medical bills or incorrect treatments.

Child identity theft

The most vulnerable identity theft victims are those most likely to be unaware of their credit reports. For this reason, thieves will prey on children and young adults’ identities. Criminals can steal a child’s Social Security Number to apply for government benefits, such as welfare payments, or apply for credit cards and loans in their name.

Synthetic identity theft

Lastly, the most sophisticated type of fraud is synthetic identity theft. In these cases, thieves steal pieces of information from several different people to create a new identity to commit accounts of fraud. This type of fraud is difficult to detect, and since it isn’t directly tied to one person, many victims suffer from the deception.

Consequences

Identity theft victims can suffer from significant financial consequences, including serious debt, low credit scores and high interest rates. These losses can negatively affect your retirement, legitimate access to tax refunds as well as job prospects. The frustration and emotional turmoil are additional costs of being a victim to theft. Unfortunately, these forms of theft take a while to recognize. Victims dedicate a great deal of time and money recovering their financial reputation and restoring their good name.

Prevention

Although some cases of identity theft are unavoidable, there are ways to take preventative measures to make yourself less likely a victim. Remember to handle your financial files with care and to always shred documents with sensitive information. Get in the habit of changing your passwords regularly and to keep your computer’s security software up-to-date.

In addition, apply the same precautions to protect your child’s information. Teach them to be cautious when revealing personal information to get them in the habit of protecting themselves from future accounts of fraud.

If you have become a victim of identity theft, please contact your local police department and report it immediately to the Federal Trade Commission.

Want to learn more about how Travis Credit Union protects your personal and financial information? Visit our website page about fraud protection and resolution.


Federal Trade Commission Fraud Protection