How to prevent identity theft and safeguard your personal information
November 27, 2023
Imagine receiving banking statements for accounts you never opened or unfamiliar transaction notifications. The stomach-sinking feeling that follows is something we wouldn’t wish on anyone. These scenarios aren’t just hypothetical — they're common signs of identity theft, a serious issue that can disrupt your personal life and financial stability. And with online transactions constantly increasing, your sensitive information is more available than ever to thieves.
Luckily, identity theft prevention strategies exist. Better equip yourself for this potential reality by learning how to prevent identity theft to maintain the integrity of your personal data.
What’s identity theft?
Identity theft involves someone illicitly acquiring and using another's private information, usually for financial gain.
This invasive crime can fracture your financial stability, tarnish your credit, and even tangle you in legal issues — all without your immediate knowledge. And thieves can steal details as simple as your name and address or as sensitive as your social security number (SIN) to impersonate or defraud you.
How do criminals steal someone’s identity?
The strategies identity thieves employ are as diverse as they are deceptive, and understanding these tactics is your first line of defense. Here are a few of the most common ones:
Data breaches: Hackers steal sensitive data from businesses.
Phishing attacks: Thieves send emails mimicking reputable sources to trick you into revealing personal information.
Malware intrusions: Malicious software is secretly installed on your device to steal data or monitor keystrokes.
Dumpster diving: Criminals search trash for bills, statements, or other papers containing personal details.
Wi-Fi eavesdropping: Unsecured public Wi-Fi networks are perfect grounds for intercepting digital communications.
Skimming devices: Thieves install small devices on ATMs and card readers to capture card information during transactions.
Social engineering: This covers manipulative interactions designed to coerce you into sharing confidential information, often by someone posing as a trusted individual or authority figure.
The most common types of identity theft
Identity theft takes various forms, each carrying unique indicators that signal a potential compromise of personal information. Understanding these variants and their signs equips you with the knowledge to identify breaches swiftly:
Financial identity theft is where unauthorized individuals command your financial information to make purchases or withdraw funds. Watch for unexplained transactions or alterations in your credit report, which are early warnings.
Medical identity theft occurs when someone uses your identity to procure medical services. An anomaly in your medical records or unexpected bills for services you didn't receive are telltale signs.
Tax identity theft involves perpetrators using your SIN to file fraudulent tax returns in your name. Receiving a notice from the tax authority about a duplicate filing is often the first clue.
Criminal identity theft is a particularly troublesome type involving criminals impersonating you during legal altercations, leaving you with a criminal record. Unwarranted legal documents or court summons are the harbingers of this type.
Synthetic identity theft involves combining real and fabricated information to create a new identity. Discrepancies in personal details across various documents could be an indicator.
How to protect yourself from identity theft: 11 methods
Securing your identity requires proactive and robust measures. Here are 11 essential tips to prevent identity theft you can implement immediately:
Secure your SIN: Avoid carrying the physical card with you, and be wary if individuals ask for this information when it seems unnecessary, like on a job or apartment application.
Fortify online passwords: Use complex passwords for online accounts and change them periodically. You could also use IronVest’s password protection service.
Use personal data masking services: IronVest offers masking services such as masked email addresses, phone numbers, and credit card details.
Stay alert to phishing attempts: Reject unsolicited requests for personal information, whether via email, phone, or text, and verify the legitimacy of such inquiries by contacting the institutions and individuals directly.
Monitor your financial statements: Scanning your financial statements for irregularities can catch identity theft early. And set up alerts for unusual activity on your accounts.
Shred sensitive documents: Destroy physical items containing personal information before discarding them, and store digital sensitive information on an encrypted and hidden hard drive.
Be wary of public Wi-Fi: Avoid conducting financial business or sharing sensitive information over unsecured public networks. And when possible, use a virtual private network (VPN) for added security.
Update your devices: Keep all digital devices updated with the latest security patches and anti-virus software to prevent malicious attacks.
Regularly check credit reports: Check your Equifax, TransUnion, and Experian credit reports regularly — like once a month — and report suspicious entries immediately to the credit bureau for investigation.
Use multi-factor authentication (MFA): Set up MFA on every platform and device possible, making it harder for thieves to access your accounts.
Consider identity theft protection services: Evaluate the benefits of subscribing to an identity theft protection service like IronVest. Our services include monitoring personal information, alerting you to potential threats, and assisting in recovery if your identity is stolen.
Cybersecurity is a community goal — share these steps with friends, family, and coworkers so everyone knows how to stop identity theft.
Navigating the aftermath: How to report identity theft
When identity theft comes to light, time is of the essence. Report the fraud to your bank and credit card issuers to block further transactions.
Then, contact the relevant credit bureaus to flag your credit reports with a fraud alert, and consider a credit freeze, which restricts access to your credit report and makes it more difficult for identity thieves to open new accounts in your name.
Finally, file a report with the Federal Trade Commission (FTC) and your local police department to officially record the incident, which can aid in the recovery process and protect your rights.
Reporting the incident to the FTC through their website IdentityTheft.gov creates an official identity theft report and recovery plan. And a police report documents the crime and is often necessary when dealing with creditors. Provide detailed information and any evidence you have of the theft to law enforcement. Remember: A paper trail is your ally in rectifying the situation and reclaiming your identity.
For some identity theft types like tax or medical services fraud, you may need to contact the IRS or your health insurance provider.
Secure your digital footprint with IronVest
Guarding against identity theft is complex and ever-evolving work — let IronVest help. We offer biometric password protection, masked emails, masked phone numbers, and virtual cards. When you team up with us, you gain the best solution to identity theft in the business. Get IronVest today, and enjoy a team that takes a several-steps-ahead approach to data theft.