Identity theft happens when someone steals your personal information to commit fraud. An identity thief may use your information to apply for credit, file taxes, or even get medical services. These acts can damage your credit status while costing you valuable time and money to restore your good name. Below are some of the most prevalent identity theft scams and how each works.
The gift card scam
Since 2018, consumers have lost nearly $245 million to gift card scams, with a median loss per person of $840, according to the Federal Trade Commission. One common trick identity thieves use is the fake giveaway. A person may receive a text or email from a well-known store or organization saying that they’ve won a gift card. To collect the gift card, they must provide more contact information, click on a website (which could add malware to their device) or take a short survey that asks questions about your finances or other personally sensitive details.
Medicare card ‘verification’
Data compromises in the health care industry affected over 50 million people in 2021, according to the Identity Theft Resource Center (ITRC). Older Americans are being called, emailed, or even visited in person by scammers claiming to be from Medicare. They offer health services and/or new Medicare cards with microchips if seniors will verify their Medicare identification number. Seniors who fall for this ploy are likely to discover that their Medicare information is being used by an imposter to get healthcare services or to bill Medicare and collect money.
Child identity fraud
Children are at risk of identity theft because their Social Security numbers are not associated with a credit history, which makes it easier to create fraudulent IDs using their information. Also, the theft might not be discovered until the child is old enough to apply for a job, a student loan, or an apartment. Alarm bells should go off if you get debt collection letters or phone calls, preapproved credit offers, traffic tickets, overdue tax notices or IRS letters saying you can’t claim your child as a dependent because their Social Security number is on someone else’s return.
Fake online shopping sites
Shoppers may see an ad for something they like on social media or while surfing the web. If they click on the ad, they are then redirected to an online store that looks legitimate, proceed to checkout using a credit card, money order, a preloaded card or wire transfer. The merchandise never arrives, or the shopper doesn’t receive what they believed they purchased. While attempting to reach the store, the site is now gone from the internet and the identity thieves have credit card numbers and other personal information. Beware of social media-based stores that are very new with prices that are too good to be true. Be suspicious if a site asks for payment by wire transfer or other immediate means. It is also a big red flag if terms and conditions, dispute resolution and contact information are scarce or nonexistent.
If you think you have been a victim of such a crime, please report it to the Federal Trade Commission (FTC) online at IdentityTheft.gov or by phone at 1-877-438-4338.
*Signal Financial Federal Credit Union is not affiliated with any of the companies mentioned or sites that are linked in this article.