How Does Identity Theft Happen?

The news of increasing hacking attacks on merchants, health insurance sites and other businesses has most of us worried more than ever about having our identity and financial information stolen. Online identity theft is an overwhelming problem, for sure. But it’s important to remember there are many ways thieves steal your identity, and the more you know, the better you can protect yourself. Identity theft can drastically rock your world, and it can take months or even years to reverse the damage done to your good name. Here, we’ll explore the most common ways identity theft happens and give you recommendations on how to protect yourself.

How Can your Identity be Stolen with Low Tech Methods?

These days, we worry so much about cyber crime, it’s easy to forget about old-school methods of identity theft. And yes, thieves still target people in the following ways, especially senior citizens.

Wallet Theft
If your wallet goes missing, there’s a ton of personal information ripe for thieves to steal your identity: your driver’s license, social security card, credit cards, health insurance cards and more. Try to carry only what you absolutely need in your wallet when you go out. Social security cards are best left at home, ideally in a locked safe.

You may have also heard of RFID theft which is when someone steals your info digitally from your credit cards without even touching your wallet. We suggest you consider an RFID blocker to avoid this possibility.

Mail Theft
Identity thieves can intercept your incoming mail to steal your personal identification information, pre-approved credit card offers and checks made out to you. An important tip? Don’t ever leave your sensitive outgoing mail in your home mailbox. Make sure you place it in a mailbox where no one can access it.

Dumpster Diving
When throwing out old bills, bank statements and other documents that contain personal information, be extremely mindful. Thieves still dig through your outdoor trash bins to find what they need to steal any information they can from you. Your best protection? Purchase a paper shredder or burn sensitive documents.

Phone Scams
Yes, you’ve heard about phone scams for years now, but they’re still prevalent, and clever thieves continually change their game plan with the latest scam. Don’t ever disclose your personal information to anyone who calls you asking for it, whether the caller is posing as a charity, government agency, bank, insurance company or other business.

Personal Theft
Although you want to trust your relatives, friends, co-workers, housekeepers and other people who you let into your personal life, there’s always a risk that your personal information could be stolen from those closest to you. To best protect your personal documents in your own home, lock them in a home safe (or better yet, a bank safe deposit box).

Tip: Experts say the worst place you can leave personal documents is the top right drawer of your home desk.

What Are Common High-Tech Methods of Identity Theft?

We often think of cyber crime as more of a threat now than old-school identity theft, and there are good reasons for that perception. It’s often harder to target the source of online identity theft because there are so many hidden back avenues where thieves can creep in online without you knowing. The following are some of the more common Internet-related methods of identity theft.

If you receive an email from a financial institution or another business that gives you a link asking for your username and password — major red flag! Whether the email is from a known institution or one you’ve never done business with, that email is more than likely from an identity thief wanting to gain access to your online accounts.

Spoofing is another method hackers use to gain unauthorized access into your computer. These hackers will disguise themselves and their IP address as a trusted and reliable source, typically in the form of an email. So, you’ll click on a link you believe to be trustworthy, which then drives you instead to the hacker’s site or to unknowingly download a virus.

Spyware & Malware
One common way cyber thieves use spyware and malware, types of software that can infect your computer without your knowledge, is to steal your personal information through your keystrokes. This keylogger software records every key you type and sends the records back to the hacker. Social security numbers, credit card numbers, bank account logins and more are now in the hands of an identity theft.

How to Protect Yourself from Identity Thieves

In our day and age, there are so many ways thieves can steal your identity online or otherwise without you even knowing until it’s too late. There are steps you should take to protect yourself, but these days it’s nearly impossible to stay on top of it all yourself. Fortunately, there are a number of identity theft protection services and credit monitoring services that you can subscribe to for a relatively nominal monthly fee to keep your identity and financial integrity safe. See our article, Best Identity Theft Protection, for our reviews and top choices for online identity theft protection services.

One Identity Thief’s Story

The headlines don’t tell the full stories behind cyber crime and identity theft, but the following video, produced by the Smithsonian Channel, highlights how dangerous one lone hacker was just a few years back. It makes you wonder how many more like him are out there hiding behind their computer screens.

Why Not Secure Your Entire Family’s Future?

Identity theft affects someone in the U.S. every two seconds — and there’s no age that’s off-limits. In a 2011 report on child identity theft by Carnegie Mellon CyLab, more than 10% of children had someone else using their social security number. Whether it’s stealing your child’s identity or your own, identity thieves don’t discriminate. And it’s overwhelming to realize all the ways one hacker or thief can damage you or a family member. But armed with the information in this article, you can start to make changes in how you handle your personal information more securely.


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