8 ID Theft Terms You Need to Know Now
18 January 2016
When it comes to protecting your identity, don’t let confusing terminology keep you from holding the upper hand over fraudsters. As you make plans to bolster your ID protection this year, use this helpful guide to inform your decision-making so you can stay one step ahead of identity thieves:
- Credit fraud: Credit fraud occurs when a person uses a credit card, bank account, loan or other type of credit account to buy goods or services with the intention of avoiding payment. One of the most common ways in which this takes place is when fraudsters use stolen credit account information to make purchases in a name other than their own.
- Credit freeze: A credit freeze, or security freeze, prevents the credit bureaus from releasing consumers’ credit reports without their consent, which they can only give after proving their identity. This free proactive step protects consumers from fraudsters trying to take advantage of their clean credit history by opening new lines of credit in their name.
- Data breach: When a data breach takes place, supposedly private personal information is released, either intentionally or unintentionally, and shared with un-trusted sources. The most high-profile breaches occur when large corporations are targeted by hackers, who steal consumer data including personally identifying information and financial data.
- Dumpster diving: Another place identity thieves look for consumer data is in the garbage. Sorting through residential trash bags, dumpster diving ID thieves search for scraps of paper containing lines of personal information, such as bank account numbers or Social Insurance Numbers. To thwart dumpster divers, always shred sensitive documents with a cross-shredder before disposing of them.
- Fraud alert: Consumers can have a fraud alert placed on their accounts to alert potential creditors that they may have become a victim of fraud. If someone tries to open an account in the consumer’s name, the creditor will call him or her on an agreed-upon contact number. The consumer then has the option to deny the request if it was in fact unauthorized.
- Identity theft: While credit fraud is committed in the name of making an unauthorized purchase, identity theft refers to a far broader range of activity. When identity theft occurs, thieves steal personal information so that they can apply for loans, jobs, health insurance plans, etc. behind the veil of a false identity.
- Malware: Malware, short for “malicious software,” includes a variety of programs designed to remotely and covertly compromise the data stored on a person’s computer system. Bots, viruses, spyware and keystroke loggers are all types of malware that cyber criminals can use to steal everything from login credentials to credit card and account numbers without victims realizing.
- Phishing: One of the most commonly attempted forms of identity theft, phishing occurs when ID thieves send fraudulent emails under the guise of trustworthy entities in an effort to gain access to sensitive information. In some cases, phishing emails ask targets to click a link that can initiate a malware download. Other times, they direct consumers to a fraudulent website made to look legitimate, asking them to enter their personal or financial information. To avoid becoming a victim of phishing, never click on links inside unexpected emails. Instead, try navigating to the page from the company’s homepage. Consumers can also call businesses to confirm whether or not the email is legitimate.
To best protect yourself from the above threats, consider signing up for a credit monitoring service. It can notify you if it detects certain activity on your credit accounts that could indicate fraud, giving you the information you need to act and protect yourself.