Synthetic identity theft is the use of a false identity based on information from a real or made-up person. Identity thieves use this synthetic information to apply for credit cards, open bank accounts or request identity cards. Both individuals and companies need to identify the signs of theft and work toward protecting their assets.
Signs of Abuse
Preventing identity theft starts with identifying the warning signs when they appear. These signs include a credit card bill or monthly bank statement that seems bigger than usual. The first step is to review all monthly statements and look for unusual activities. If a problem is found, it must be reported to the bank immediately.
Most banks give options for their account holders to receive alerts whenever certain activities happen. So, every account holder should sign up for automatic email or text message alerts. Without alerts, any thief can pretend to be someone else, open up new credit cards and ruin the person’s credit in a short period of time.
A credit report shows a complete history of a person’s financial status. It starts when the person opens up a first bank account, and it continues through the borrowing of student loans, the long-term payments of mortgages, etc. Every major financial event shows up on this report, whether it’s a bankruptcy or a delinquent loan. The report can be mostly positive or negative, depending on his or her actions.
Some websites, such as online payday lenders, cannot be trusted with sensitive personal information. Even if the company is trustworthy, there could be a hacking incident that causes large amounts of important data to be stolen. It’s necessary to be cautious when working with any website that requests and stores personal information.
Hackers can steal identities online, but many thefts occur in person. People should not allow others to use their personal belongings. They should carry as few credit cards and identification numbers in their wallet as possible. To protect customers and employees, companies should shred discarded documents and require passwords on their accounts.
Synthetic identity theft is the use of real and fictional information to create a new, fraudulent identity. It’s a common crime, but many people are learning how to protect their assets. They are using strong passwords on their bank accounts or checking personal credit reports. Getting insurance for identity theft is one option, but the best option is to prevent it from happening.