Identity theft affects millions of people every year. Understanding the most common identity theft types can help you recognize risks and protect yourself. Let us explain each major type, their impact, and how to guard against them.
At Sherman & Ticchio PLLC, we assist clients facing problems caused by identity theft, especially when it leads to errors on credit reports or background checks. Our legal team works to correct these issues and help regain control.
What Is Identity Theft?
Identity theft occurs when someone takes your personal information without permission. They might use it to open accounts, make purchases, or commit fraud under your name, which can damage your credit, finances, and reputation.
Thieves often obtain this information through hacking, phishing, or stealing mail. Some even impersonate you using your data. Understanding the different types of identity theft can help you stay vigilant.
Signs and Early Warning of Identity Theft
Recognizing identity theft early is vital. Look for unusual bank or credit card activity. Unexpected bills or collection calls can signal fraud. Check your credit reports regularly for unknown accounts.
Receiving mail about loans or credit you did not apply for is suspicious. Delayed or missing mail can also warn you. Early detection helps you act before more damage occurs.
- Financial Identity Theft
Financial identity theft is the most common and damaging form of identity theft. Criminals steal your personal details and use them to open bank accounts, apply for credit cards, or take out loans in your name.
They may make unauthorized purchases, withdraw money, or rack up debts that you are unaware of. These fraudulent activities often show up on your credit reports as unfamiliar accounts or unpaid bills, which severely harm your credit score.
Victims can face serious financial consequences, including difficulty obtaining future credit, higher interest rates, or loan denials. Fixing financial identity theft usually involves disputing fraudulent charges and accounts with creditors and credit bureaus. Reporting suspicious activity as soon as possible helps limit further damage and can prevent more fraud.
- Medical Identity Theft
Medical identity theft occurs when someone steals your personal information to obtain medical treatment or prescription drugs in your name.
They may also use your identity to file false claims with insurance companies to receive payments illegally.
Victims may also receive bills for services they never received, which can be confusing and costly. Medical identity theft can affect your healthcare access and insurance coverage if untreated. Correcting this type of theft involves working closely with healthcare providers, insurance companies, and billing departments to correct inaccurate records and clear any fraudulent charges from your name.
- Tax Identity Theft
Tax identity theft happens when criminals use your Social Security number to file fraudulent tax returns. They do this to claim refunds or credits you never applied for. The IRS may delay processing legitimate tax returns when they detect suspicious filings under your Social Security number.
Many victims first discover this theft when their own tax return is rejected or they receive a notice from the IRS about multiple filings.. This can be time-consuming and stressful. It is important to act quickly to minimize delays and avoid penalties.
- Social Security Identity Theft
Social Security identity theft occurs when someone steals your Social Security number and uses it to work illegally or collect government benefits in your name. This misuse can lead to inaccurate earnings records and tax reports, which may affect your future Social Security benefits or tax obligations.
You may only find out about this type of theft when you apply for a job, Social Security benefits, or file taxes and discover discrepancies. Protecting your Social Security number by sharing it only when necessary and checking your Social Security earnings statement regularly can help you spot and report misuse early before it causes major complications.
- Child Identity Theft
Children are particularly vulnerable to identity theft because they usually have clean credit histories, making them attractive targets for criminals. Thieves use children’s personal information to open credit cards, and loans, or commit other types of financial fraud. This type of theft often goes unnoticed for many years until the child becomes an adult and applies for credit for the first time.
By then, the fraudulent activity may have caused significant damage that is difficult to repair. Parents and guardians should take steps to protect children’s personal information, such as securing birth certificates and Social Security cards. They should also monitor credit reports and financial records on behalf of their children to detect any unauthorized activity early.
- Synthetic Identity Theft
Synthetic identity theft happens when criminals create a fake identity using a mix of real and fabricated information. For example, they might combine a real Social Security number with a fake name and birthdate. These synthetic identities are then used to open credit cards, apply for loans, or commit other types of fraud.
Because these identities do not belong to actual people, they can be hard to spot. Victims usually do not realize synthetic identity theft has occurred until they face serious financial damage or get denied credit unexpectedly.
Synthetic identity theft continues to grow, which makes it one of the most challenging types to prevent and resolve.
- Criminal Identity Theft
Criminal identity theft occurs when someone uses your personal information during an arrest or police investigation. The thief offers your name or Social Security number instead of their own. As a result, false criminal records may be created under your identity. These records can severely impact your life by blocking job opportunities, housing applications, or professional licenses.
Removing false criminal records can be complex and often requires legal help to prove your innocence and clear your name. This type of theft can seriously damage your reputation, even though you had no involvement in the crimes.
- Account Takeover
Account takeover involves criminals gaining access to your existing bank accounts, credit cards, or online profiles. They might obtain your login information through phishing or hacking. Once inside, thieves can change passwords and contact details to lock you out. They then make unauthorized purchases or withdrawals.
Account takeovers often happen quickly and cause immediate financial losses before victims notice. Protecting your accounts with strong, unique passwords and using two-factor authentication helps prevent unauthorized access. Regularly reviewing your account statements can also help detect suspicious activity early.
- Employment Identity Theft
Employment identity theft occurs when someone uses your personal information to gain employment illegally. They might use your Social Security number and name to work without authorization or avoid taxes.
This type of theft can cause serious problems for you because the income earned under your identity will be reported to the IRS, potentially leading to tax liabilities or issues with your Social Security earnings record.
Victims may only discover this theft only when they receive unexpected tax notices or notice discrepancies in their employment records. Resolving employment identity theft may require legal assistance to correct tax and employment documentation.
- Identity Cloning
Identity cloning is when criminals impersonate you in everyday life. They might use your personal information to get driver’s licenses, rent apartments, or even commit crimes under your name. Victims of identity cloning can face serious legal and financial consequences. It often takes significant effort and time to prove that you are not responsible for the cloned actions.
Because cloning involves real-world impersonation, it is especially hard to detect and resolve without professional assistance. Victims may face difficulties with law enforcement, creditors, or landlords until their identity is cleared.
- Utility Identity Theft
Utility identity theft occurs when someone uses your personal information to open utility accounts, such as electricity, water, or phone service. They then rack up unpaid bills in your name. You may first notice this type of theft when your utility provider denies you service or asks for a large deposit due to unpaid balances.
Fixing utility identity theft often requires contacting the utility companies and credit bureaus to correct your records. It is important to act quickly to prevent damage to your credit score and avoid collection actions on debts you did not incur.
How Sherman & Ticchio PLLC Can Help
Identity theft often results in errors on credit reports and background checks. Sherman & Ticchio PLLC helps clients with credit report litigation and background check litigation. We guide clients through correcting these errors with clear advice and legal support. If identity theft affects your credit or background, seeking legal help can protect your rights.
Protecting Yourself from Identity Theft
Guard your personal information carefully. Use strong passwords, shred sensitive documents, and be cautious about sharing information. Regularly check your credit reports and background information. Early detection helps stop identity theft before it causes damage.
Understanding the most common identity theft types helps you spot fraud early. Taking quick action and seeking support keeps your identity and credit safe.
Contact us today.