All over the world, identity theft is a critical detrimental issue plaguing cyberspace. 1 in 3 Americans have experienced identity theft, and 33% of citizens of the United States have been victims of identity theft at a moment in their lives. In 2021, there were 4.7 million victims of identity theft, and in 2022, there was an increase to 5.7 million in 2022, which is a 1.1 million increase.
Identity theft operations can occur in various ways; one popular medium is data breaches. Persons with evil or illicit intentions target companies with large databases in order to use such data to pose as another person. Such as email address, age, birthday date and the like. Many big companies have suffered from data breaches in the past. In fact, Tesla had a massive data breach in May of 2023.
Since identity theft is such a worrisome trend, it is important that all concerned stakeholders contribute or implement their quota to combat the dangerous crime. This article will deftly explore strategies and technologies that can be employed to combat identity theft.
What Is Identity Theft?
Simply put, Identity Theft, as the term implies, involves stealing a whole or a part element of one’s identity for malicious use or personal gain.
Identity theft is a type of fraud in which a person’s personal information is taken and used without their permission by someone else, generally for financial gain or to commit other illicit crimes. Personal details such as a person’s name, Social Security number, credit card numbers, bank account information, and other sensitive data are commonly stolen.
Identity theft can be perpetrated through the following mediums:
1. Data breaches
Cybercriminals can steal massive volumes of data at once when they hack into databases or systems that store personal information. Many high-profile data breaches have exposed millions of people’s personal information.
Thieves may employ deceptive emails, phone calls, or messages to fool people into disclosing personal information like login passwords or financial information.
3. Social engineering
Using human contact to manipulate or deceive others into disclosing personal information. This could be done in person, via phone, or even over social media.
4. Dumpster diving
Some identity thieves go through a person’s garbage in search of documents or statements providing personal information.
When identity thieves obtain discrete information about a person, they can engage in various illegal activities; an example could be posing as another person, opening credit accounts with stolen information, making unauthorised purchases, applying for loans, dating scams, phishing, etc.
Implications Of Identity Theft
This section discusses some of the consequences of identity theft, which illustrate the reasons why identity theft needs to be combatted.
Identity Theft Is Costly
Recovery from Identity theft frequently involves legal fees, notary fees, and payments for getting credit reports and monitoring services. These expenses add to the victim’s financial burden. It also leads to financial losses, which are significant; identity thieves may make unauthorised transactions and fraudulent charges on credit cards or bank accounts. Victims may then be held responsible for the unauthorised expenses. It can also lead to the loss of savings as a result, especially when an identity theft leads to a fraud scam. It can also lead to the loss of employment, which puts a stall on a person’s income. Victims may lose trust in financial institutions and online services, affecting their willingness to engage in online activities or use certain financial products, which can disrupt their daily lives.
It Causes Legal Troubles
In some instances, identity thieves may engage in criminal activities using the victim’s identity, leading to potential legal issues for the victim. Clearing one’s name and criminal record can be a complex, time-consuming, and costly process.
Identity theft is a serious invasion of personal privacy. Thieves gain access to a victim’s most sensitive information, potentially leading to further breaches of confidentiality, and the victim may feel violated.
A victim’s reputation can suffer if identity thieves use their personal information to engage in unethical or criminal behaviour. This damage to one’s reputation can have a lasting impact on personal and professional relationships. It also has long-term consequences, and the effects of identity theft can linger for years. Victims must continue working to clear their records, rebuild their credit, and reestablish their financial stability. The long-term consequences can impact financial planning and retirement goals.
Difficulty Obtaining Jobs, Housing or Education
With a tarnished credit history or a criminal record resulting from identity theft, victims may find it hard to secure employment or housing, further hindering their ability to move forward. Identity theft can hinder educational pursuits and career opportunities, especially if it results in legal troubles, poor credit, or damaged personal and professional relationships.
Identity Theft May Cause An Organisation’s Reputational Damage
For some commercial entities, organisational damage can lead to the loss of trust in them on the part of consumers. It damages public PR and has a damaging effect on profit and patronage metrics.
Strategies And Technologies For Combatting Identity Theft
There are several strategies or methods that have been proposed, as well as technology that has been developed to combat and prevent identity theft; they range from basic to complex means or mediums, which all have great mitigating and preventive effects on identity theft. It is crucial to discuss these means as identity theft has already been identified as a crucial threat to the cyber world. Identity theft is also an aiding vice to several crimes, including money laundering and territory financing, which means that identity theft also poses a threat to the financial industry; it is important that deft methods and technology are employed to tackle identity theft on a daily basis.
Identity theft is a pervasive and evolving threat that poses serious risks to individuals, businesses, and financial systems. It is crucial to employ a comprehensive array of strategies and technologies to combat and prevent identity theft, as it not only affects personal and financial well-being but also facilitates various other crimes, including money laundering and terrorism financing. Identity theft stands as a significant menace in the digital age, with dire consequences for victims and broader implications for society. By adopting effective strategies and utilising advanced technologies, we can bolster defences against this pervasive threat.
Technology such as Liveness detection offered by Reg Tech companies such as Youverify can be utilised, especially in onboarding processes, in other to prevent identity theft, which can aid further crimes. Liveness detection software by Youverify is able to spot deepfakes in a second and has a 99% completion rate. Youverify offers other products and solutions that aid the verification of identity, such as customer verification.
Strong Passwords and Authentication
While this may seem basic, using strong, unique passwords for online accounts and implementing two-factor authentication (2FA) adds an extra layer of protection. Password managers can assist in generating and securely storing complex passwords.
Users should practice caution when sharing personal information online, especially on social media, and be vigilant about clicking on suspicious links or downloading attachments from unknown sources are fundamental steps.
The frequent monitoring of financial statements, credit reports, and online accounts can help identify unauthorised or suspicious activity early, and this reduces potential damage.
Utilising secure, encrypted connections when transmitting sensitive data over the internet, such as for online purchases or accessing financial accounts, is crucial for safeguarding personal information.
Antivirus and Anti-Malware Software
Installation of reputable antivirus and anti-malware software, along with regular updates, is vital to protect devices against malicious software designed to steal personal data.
Employing firewalls on devices and networks provides an additional layer of security against unauthorised access and intrusion.
Documents should be securely disposed of. Shredding documents containing sensitive information before disposal helps thwart identity theft through methods such as “dumpster diving.”
Educating oneself and one’s family about phishing scams and how to recognise and avoid them is essential. Suspicion of unsolicited emails and messages is a key component of prevention.
Identity Theft Protection Services
Enrolling in identity theft protection services that actively monitor personal information and alert users to any suspicious activity can be a valuable addition to one’s defence strategy.
Credit Freezes and Monitoring
Freezing credit with major credit bureaus prevents the opening of new accounts without consent. Regular monitoring of credit reports can identify irregularities promptly.
Education and Advocacy
Participation in identity theft awareness and prevention programs, as well as advocacy for robust data protection laws and regulations, can contribute to a safer digital environment.
Digital Wallets and Contactless Payments
The adoption of digital wallets and contactless payment methods provides an extra layer of security when making transactions. These technologies often incorporate tokenisation and biometric authentication for added protection.
Credit Card Alerts
Individuals should set up alerts with credit card companies to receive notifications of unusual or large transactions to assist in the early detection of fraudulent activity.
Secure Mobile Devices
This involves using PINs, passwords, or biometric authentication on mobile devices and installing security apps to locate and remotely lock devices in case of loss or theft are key measures.
It is important that employers provide avenues for employees to be trained in order to be efficient in handling sensitive data. Businesses and organisations should provide comprehensive cybersecurity training for employees and establish robust policies to protect customer and employee data. This way, incidents such as identity fraud, as well as other related occurrences, will be prevented.
Identity theft is a serious menace to the digital age and space, and it is important that preventive and combative methods are employed against illicit activity. Advanced methods and strategies need to be adopted in order to combat the menace. Identity theft is a view that can aid other illicit crimes, such as human trafficking, money laundering and the like. It is important for organisations and individuals to practice basic precautionary practices such as using strong passwords, disposing of documents adequately etc., as well as using two-factor authentication and employing Regtech solutions to combat identity theft. Youverify offers a wide range of solutions that help combat the menace of identity theft.