What is identity fraud?
So what is Identity Fraud?
There are TV dramas dedicated to it, reports written about it and insurance protection from it but what is identity fraud?
I think by now we’re all familiar with the idea of identity fraud thanks to the daily news coverage dedicated to the latest unsuspecting celebrity victim. Oprah Winfrey, Paris Hilton, Lily Allen, Ricky Gervais, Tiger Woods, and Jeremy Clarkson are just a few of the high-profile celebs how have fallen pray to the fraudsters in a variety of imaginative ways and had their lives turned upside down in the process.
In this blog I hope to give you a better understanding about identity fraud and identity theft.
Formal definition of Identity Theft and Identity Fraud
First, I think it’s worth making an important distinction between identity fraud and theft.
- ID theft relates to the action of obtaining someone’s identity unlawfully
- ID fraud on the other hand is the act of using that identity for deceptive purposes which is likely to lead to financial or personal loss to the individual
Whilst Identity Protection products will generally cover you for fraud and theft it’s worthwhile understanding the difference as you could be a victim of theft without fraud occurring and this might affect your particular case. On top of this fraud and theft can be detected in different ways.
Types of identity theft and fraud
Today there’s a pretty extensive list of the ways innocent people can be under threat from theft and fraud with more methods for stealing personal info being dreamt up daily. I’ve named a few of the common types below in two sections but you can find more by visiting the CPP fraud glossary.
Identity theft threat from Phishing, pharming and more...
Most of us receive a lot of emails everyday. Some from people and companies we know and some from those we don’t. Emails from companies or people we don’t recognise often make us wary and are generally picked up by a spam filter automatically. However, just because you recognise a company’s name doesn’t mean you should trust an email that appears to be from them.
Bogus emails sent by ID fraudsters trying to trick you out of your personal information can often look like the real McCoy but don’t be fooled. It might look like it’s from your bank or credit card company but organisations of this kind will never ask you for personal details such as your PIN, account or login details. If you’re suspicious, contact the company the email appears to be from and ask if this is a legitimate communication.
This type of theft also occurs online and refers to attempts by a hacker to divert traffic from a legitimate website to a bogus version of the site. The site may well look exactly the same as the one you were expecting to visit and is therefore very difficult to detect as being a fake. Unfortunately anti-virus software often isn’t enough to combat Pharming and more complex anti-pharming tools are required.
A new ID theft term has appeared on the block thanks to the growth of wireless internet connections. The term ‘Wi-jacking’ doesn’t just refer to someone using an unprotected Wi-Fi connection to access the internet. It also describes criminals using the connection to hack into personal information and documents held on your computer. If not secured properly, Wi-Fi connections can act as a gateway into your identity if you hold sensitive information on your laptop or PC. Worryingly, all the hacker needs is a laptop and the knowhow to get hold of your usernames, passwords and other highly sensitive information.
In the next week or so we’ll be posting more about Wi-jacking. The risk from this type of fraud is extremely high so come back again soon or sign-up to our RSS Feed so you can access this new information as soon as it’s published online.
Although less prevalent than the various types of online identity theft, most of us are still under threat from bin-raiding. This is the act of someone rummaging through bins or rubbish to find snippets of personal information that can help pull-together a picture of your identity. With this information criminals could go ahead and commit fraud using the information they’ve found about you. Shredding remains the best way to ensure all of the mail and other documents that you want to dispose of is destroyed before it goes in the bin so your details aren’t identifiable.
Similar to Phishing or Pharming mentioned above, some criminals will attempt to pose as a legitimate company over the phone. If you receive a call from a company asking you to provide personal details such as your PIN number or account details you may be experiencing an attack from and ID thief. Again, don’t be tricked, instead, contact the company directly if you’re suspicious.
When we move house it’s quite typical for most of us to set up mail-redirection via Royal Mail whilst we work through transferring all of our mail to the new address. However, it’s possible for other people to set up redirection for your address just with a few of your details. This could mean that someone else begins receiving your mail and could be accessing personal documents. You should always be vigilant and make sure that you know when to expect important mail.
Fraudulent use of your personal data
The specific ways in which a thief might use your personal information are too many to mention. In Ricky Gervais’s case the thieves were caught trying to change Ricky’s money into gold bullion! Instead I’ve tried to categorise the main threats below.
Loans and other financial services
Using your personal details fraudsters could take out loans, set-up accounts and in some instances actually take over your bank accounts. Taking a look at your credit report [link to credit report info] is a great way of checking the loan agreements and credit you have set-up. You should also keep an eye on your bank account to make sure there are no suspicious transactions.
Products and other goods
Just having a few of your personal details such as a username and password an ID thief may be able to carry out online purchases. At the other end of the scale with the right information they would be able to carry out far larger purchases. Either way, it’s still you footing the bill.
If your information falls into the wrong hands the tangible assets you own could potentially be at risk. In some extreme cases home owners have had their houses or flats sold from beneath them due to a loophole in the law. If a fraudster manages to use your information to claim ownership of your home it’s possible for them sell your home without your knowledge. The buyer will legally have ownership of your house despite you being unaware of the purchase due to them having bought the property in good faith.
Detecting identity fraud and theft
The good news is there’s a lot you can do to stay vigilant and avoid being a victim of identity theft and fraud. We’ll shortly be publishing a follow-up blog that will cover the steps you can take to combat this type of crime.
Don’t forget that as well as taking care of things yourself there are also products out there that provides protection against identity fraud and will help you get back on track as soon as possible.
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