Identity Theft: A Closer Look – Part 1

Identity Theft: A Closer Look - Part 1 - Quicken Loans Zing Blog Constantly raising our level of awareness is a core value at Quicken Loans, so we’d like to bring to your attention that it’s National Identity Theft Week. Experian, one of the largest credit reporting agencies in the United States, notes that nearly nine million Americans experience identity theft each year.

When we think of identity theft, we associate it generally with adults and their finances, like when someone hacks into their bank account or rips off their debit card information. However, identity theft can impact pretty much anyone at any stage of life – and sometimes the thief isn’t even interested in your money.

Medical Identity Theft 

Medical identity theft means that someone stole information, like your name, birthday, social security number, or parts of your insurance information to acquire medical treatment. With this data, they might acquire prescription drugs or medical treatment on your dime. Today, since we’re storing more medical files electronically, this type of theft continues to gain momentum.

InsuranceFraud.com notes that nearly two million Americans are victims of medical identity theft each year. They add that it takes a year or more to resolve most cases, costing them $20,000 on average.

Criminal Identity Theft 

Wonder why all of a sudden there’s a warrant out for your arrest when you haven’t committed any crime or even received a speeding ticket in your entire life? As silly as this this sounds, it’s a real possibility.

Much like financial identity theft, criminal identity theft occurs when a suspect steals your name, birthday, and social security number and then creates a fake ID. If the police catch the thief red handed, they can pass off the fake ID with your information. It then goes on the police record and on your criminal record. Next thing you know, the true criminal is in the wind and you’re stuck with a crime you never committed. Some people don’t even find out until they fail a background check for their employer years later.

Stealing a Deceased Person’s Identity 

In the past few years, I’ve heard a few news stories about people purchasing the names of deceased people to boost petition signature. People use this technique, called “ghosting,” to ruin someone’s financial reputation after they’ve died. Not only does it damage the deceased person’s status, it impacts the remaining family members – forcing them to clear their loved one’s name possibly years after they’ve perished.

Recently, CNN Money reported that for $10 you could buy a deceased person’s identity. Most thieves use this information to commit tax fraud; it’s estimated that over 90,000 tax returns filed last year were under deceased names totaling nearly $25 billion.

Thieves also use this information to open credit cards and loans – racking up thousands of dollars of debt. With the person clearly not able to check their credit report for errors, a thief can take advantage of a deceased person’s financial identity for years. A similar thing happens with children.

Stealing a Baby’s Identity 

Even your newborn baby, who can’t even apply for a credit card, can fall victim to identity theft. Stories pop up daily of children declaring bankruptcy during their toddler years, or they compile thousands of dollars in credit card debt before they can read.

You’re probably wondering, “How do thieves acquire a social security number before a child is even born?” A financial expert from the Today Show notes children are issued a social security number from a pre-generated list. It’s made up of two sets of numbers. The first three digits of the number represent the state where the number is issued – almost like how an area code narrows down locations of phone numbers. The last six digits represent a code for their birthday.

Knowing these few pieces of information, a thief can pretty much piece together a fake identity using a social security number not even issued yet.  Most financial institutions just check the credit score of the social security number and nothing else. Once the thief gets access to a credit card, they can start building a credit history and go on for years. At any time they can dump the debit ridden social security number. If that number gets issued to your child, then they, unfortunately, receive all the debt associated with it.

No matter what stage of life you’re at, thieves often look for times when we’re distracted or unable defend ourselves to steal from right under us. It’s a shame that there are people in this world who take advantage or damage the reputation of others for their own benefits. The good news, though, is you can catch these issues early with due diligence.

Stay tuned tomorrow for part two on how to protect and prevent these particular identity thefts! We’re going to give you some tips and tricks to raise your level of awareness and spot these types of identity theft early.

 

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