The consulting firm Javelin Strategy & Research conducted a 2015 study that showed identity thieves stole $15 billion from 13.1 million U.S. consumers last year. While financial identity theft is the most common type of identity fraud, scammers have become progressively more sophisticated in deceiving consumers.
Crooks also are finding more ways to perpetrate fraud using your identity data. There are committing four identity crimes that don’t rely on the direct theft of your banking or financial information, though they often start with that information.
The four—government, criminal, medical and child identity theft—are types of crime that thieves bet you won’t monitor for to prevent fraud against you and your children. Often, criminals are combining financial identity theft with these other four, making resolving identity fraud more complicated for both victims and law enforcement. Members of the military and the elderly can be particularly vulnerable to three of these four identity theft types.
As you’ll learn, the effects of these crimes can be far more than financial. They can be life-changing and take years to resolve.
Identifying and understanding these 4 types of identity fraud
Since their frequency is rising, it’s important to recognize these four types of identity theft and understand what you’ll experience when they occur. This is the first step to preventing them and knowing how to restore your identity if these crimes are committed against you. Here is a description of each and how they happen.
Government identity fraud
Formally referred to as “Government Documents and Benefits Fraud” and sometimes called “citizenship fraud,” it occurs when someone uses your primary government ID to obtain government benefits in your name. The thief uses your identity to get jobs, file tax returns, get public assistance or even obtain U.S. citizenship.
This criminal activity can compromise your ability to get government benefits, employment, government contracts or bungle up tax returns. It costs you income, time and energy as well as significant stress trying to regain control over your identity.
Criminal identity fraud
When someone gives your name or falsified identification documents in your name to law enforcement after committing a crime, you’ve experienced criminal identity theft. Sometimes they only use it once for this purpose. But, in other cases, they go through the entire criminal prosecution process using your identity.
Either way, you’ll have a criminal record in your name if they’re successful with their strategy. That can lead to fines and arrest warrants for you—or worse, if the criminal already has a heinous criminal history, it becomes associated with you.
That has repercussions if you need a background check for a job, apartment or some other activity. And, it can cost you your freedom.
Medical identity fraud
This fast-growing identity fraud crime happens when, after getting access to your personal data, medical identity thieves obtain medical goods and services. That includes doctor and dental visits, medical devices, prescriptions and even surgery.
You might see diagnoses that aren’t yours show up on your health record. This crime not only can impact your health and life insurance rates but it can hinder your ability to get needed medical care, including prescriptions. It also can ruin your credit if unpaid bills end up on your credit report.
Worst of all, insurers may not believe you got defrauded and may make it hard to rectify the situation for a year or more.
Child identity fraud
This fraud happens when thieves use the identity documents of a person under 18 to commit fraud. Child identity fraud causes identical damage to the child’s credit record as to an adult’s. Worse harm can occur if the thieves sell the child’s identity to the three other types of identity fraud named here.
Often, the child or parent doesn’t discover the identity fraud until they apply for student loans as a young adult, try to rent an apartment or to get a job. In other cases, the fraud gets revealed when parent apply for government benefits for their child.
The process for removing the fake identities is as laborious as it is for adults. If children are still minors, their parents must do the work.
Monitoring against all identity theft is critical
While not 100% effective, there are strategies you can use to protect yourself from these identity crimes. Here are five steps you should take to monitor against these four types of identity fraud and fix the damage if fraud happens:
- Get your credit reports annually. You can obtain them free on AnnualCreditReport.com. Review them for accounts and collection entries, especially medical ones that aren’t yours. Track new, inconsistent or inaccurate credit report entries throughout the year by getting one of these reports every four months.
- Request your driver’s record annually from your state Department of Motor Vehicles. Check for speeding tickets, accidents or other offenses that are not yours. Address unrecognized issues immediately with your state, especially before buying or switching auto insurance.
- Request your health insurance statements and medical records annually. If you’re undergoing treatment, you may receive health insurance statements more frequently. Either way, check them carefully for fraud and report it immediately to insurers and medical providers. Be persistent getting fraud removed, especially if the hospital or insurer doesn’t believe you’ve experienced a scam.
- Keep all other personal records updated. Taking this step provides another opportunity to detect fraud. Contact creditors, medical providers, schools, government agencies or any others with changes to your name, address, phone numbers or other identifying information. When you do, check for inconsistencies by confirming prior information.
Even though pharmacy and medical records are now linked, your primary care physician or insurer may miss discrepancies that indicate identity theft. Keep your pharmacy records updated, too, and request they contact you about anything suspicious. Be as vigilant with your minor children’s records.
- Consider getting free credit monitoring or identity monitoring services. Choose those that can detect any use of your identity, alert you and help you remediate fraud. Some will alert you when somebody has opened or attempted to open new accounts in your name. Others will notify you when someone uses your Social Security number for any purpose. However, research these providers carefully to make sure you don’t get scammed. The best option that shuts thieves down cold is a credit freeze. You can even freeze your child’s credit in many states now.
Fixing identity theft when it happens
In most cases, it’s minor and easily reparable. Other times it is far more severe and can take significant time and resources to restore your credit and perhaps, your life.
The first step is to report any fraud immediately to the appropriate authorities. Which those are will depend on the type of fraud. For law enforcement, many states have specific rules and regulations for reporting identity theft so check what they are in your state. For criminal identity theft, you many need to check with an attorney for assistance.
You also can not only report identity crimes to the FTC, but you can create a restoration plan. The Identity Theft Resource Center, a nonprofit group, also helps consumers restore their identity. The organization offers specific help by crime.
Don’t be somebody who wishes they had monitored against these types of identity theft. Employ these steps to keep you and your children safe from these life-altering forms of identity fraud.