Many people think that identity theft is something that will never happen to them. Unfortunately, however, identity theft is becoming increasingly common in the United States. Approximately one in 20 Americans are affected by identity theft each year. In fact, the Federal Trade Commission received more than two million fraud reports from consumers in 2020. In addition, total reported losses from identity theft were approximately $3.3 billion in 2020, up from around $1.8 billion in 2019. Of these reported losses, nearly $1.2 billion were due to imposter scams, while online shopping accounted for approximately $246 million in reported losses from consumers.
What Are the Most Common Types of Identity Theft
There are several common types of identity theft, including:
- Unauthorized debit and credit card use: Identity thieves often use consumers’ debit and credit card credentials to make unauthorized purchases.
- Account use: Criminals also access consumers’ accounts to make purchases and withdraw funds. Common targets include checking and savings accounts.
- Opening credit accounts or taking out loans: When identity thieves get ahold of consumers’ personal identifying information, they can use it to open credit accounts and take out loans.
Causes of Identity Theft
In order to commit identity theft, thieves must first get ahold of consumers’ personal identifying information. Thieves often obtain such information from the following sources:
- Wi-Fi networks
- Stolen or discarded documents
- Data breaches affecting government agencies, merchants, health care companies, and other major organizations
- Stolen or lost debit or credit cards
- Social engineering scams
The Effects of Identity Theft
Despite the fact that much of the financial damage caused by identity theft can be alleviated by reporting the fraud and filing claims with affected financial institutions, identity theft costs consumers roughly $3.5 billion every year in out-of-pocket costs.
Preventing Identity Theft
Although it’s difficult to avoid the risk of identity theft completely, there are several steps you can take to reduce your odds of becoming an identity theft victim. Proactive steps you can take to avoid becoming a victim of identity theft include:
- Regularly monitor your credit reports and accounts
- Use an encrypted internet connection
- Don’t use public Wi-Fi
- Be mindful of your online activity
- Use unique, complex passwords
- Shred all confidential documents before discarding them
Contact a Consumer Class Action Attorney
If you are a victim of identity theft, you must take immediate steps to begin repairing your finances—the most important of which is contacting an experienced consumer class action attorney. Identity theft often happens because businesses fail to protect your personal information. When a business provides a third party with access to your personal information without your permission, our experienced consumer class action attorney will work to ensure that those responsible are held accountable for their actions and that you are compensated for your losses. Please contact us today to begin your journey to financial recovery.