Someone might be using your identity right now. It can be easy to miss it — but there are things you can watch out for to protect yourself.
Identity fraud is sadly all too common, and technological innovation can make it even worse. More than 2 in 3 Americans (68%) have at some point experienced a financial scam or fraud, according to Bankrate’s Financial Fraud Survey. And the red flags aren’t always as obvious as an email with spelling errors and dubious links, or a text message demanding you pay tolls when you don’t even own a car. Often, the telltales are much sneakier. And tools such as generative artificial intelligence, commonly abused by scammers, make fraud detection all the harder.
I recently spoke with Michael Bruemmer, vice president of data breach resolution and consumer protection at Experian, about why it’s becoming more difficult to trace identity theft. Here’s how you can still recognize its subtle signs — and steps you can take if you do.
Why identity theft can be harder to notice
As fraud detection technology becomes more sophisticated, so do the methods of fraud.
There’s a ‘tried and true’ way a criminal can use your data: they assume your identity and use your information to gain access to credit or other benefits.
But now, fraudsters have come up with something new.
“The number one overarching thing to worry about now is synthetic identity theft,” Bruemmer says.
Synthetic identity theft allows criminals to create a kind of Frankenstein monster of identity. They either combine real information from multiple people or mix in some fake personal identity information, too. In the age of generative artificial intelligence, the latter is all too easy. With the right AI tools, criminals can produce highly realistic fake documents and images. The goal of all this is to evade fraud detection.
Fraudsters can use this type of identity theft to cultivate a fake credit profile — and many do. Synthetic identity fraud could account for up to 20 percent of loan and credit card charge-offs, according to Experian. Additionally, the Federal Trade Commission calls synthetic identity theft one of the fastest-growing types of fraud.
Synthetic identity fraud is notoriously harder for businesses to identify. “It’s also harder to find out that you may be impacted,” Bruemmer says. “But some of the things apply whether it’s a real identity or a synthetic identity.”
5 subtle signs of identity theft
With such subtle identity theft techniques on the rise, it’s a good idea to remain extra vigilant. While some signs of identity theft can be rather in your face — like the IRS telling you it received more than one tax return from you — others can be easy to miss unless you make a point to look.
Here are a few things to watch out for:
1. Small transactions you don’t remember making
It’s all too easy to miss small transactions on your debit and credit card accounts. They can fall through the cracks if you don’t look at your charges regularly enough to notice. But by making minor charges (or even small deposits), a fraudster might be testing their access to your account. And eventually they might charge something much bigger.
If you notice this happening, reach out to your financial institution to remove any unauthorized charges and replace the compromised card.
2. Strange things on your credit report
Another thing to keep an eye on is your credit report. Watch out for any accounts and hard inquiries (credit or loan applications) that you don’t recognize. They might be a sign fraudsters have tried to access credit using your data.
Check the personal information on your credit file too, including addresses and your Social Security number.
“At one point, I had six different Social Security numbers pinned to my credit file,” Bruemmer says. Fortunately, he successfully cleaned up his credit report. It was only a mix-up where information from other Michael Bruemmers ended up in his file. In other instances, such mistakes happen because the financial institution makes errors in their input when reporting to credit bureaus.
Or “it may be someone trying to attempt identity theft,” Bruemmer says.
Keep the information on your credit report accurate and dispute anything that’s not. If you suspect fraud, you might also want to consider freezing your credit.
3. Missing or unexpected mail
If you receive your bank or credit card statements in the mail, and they suddenly stop coming, be suspicious. Someone might be trying to take over your account. If they succeed, they can wreak all sorts of financial havoc, from redeeming your hard-earned credit card rewards to gaining access to your other accounts or opening new ones.
Similarly, if you receive bills for things you’ve never purchased or card statements from accounts you’ve never opened, take it as a red flag. A criminal might be spending money under your name.
In either situation, contact the financial institution in question to address potential fraud and map out any next steps.
4. Your credit card application is denied
It happens. We don’t always get the credit cards we want. However, it can be worth some extra scrutiny before moving on. There are various reasons for card application denials — and fraud may be one of them.
When a lender rejects your application, it’s legally required to send you a letter explaining why. Make sure to read it and pay attention to anything that doesn’t make sense. For example, if your credit score looks suspiciously low, fraudsters might be at fault. Or if the letter says you’ve opened too many credit cards recently when you know you haven’t, it might be because a criminal has opened them in your name.
Checking your credit report after credit card rejection is always a wise step. This way, you can promptly notice any unauthorized accounts or inquiries. Currently, you can request your reports weekly for free.
5. You receive password reminders you haven’t requested
Your financial institution emails you saying you asked for a password reminder or reset. Only you haven’t.
This might be a phishing scam that prompts you to click on a link and input your login information. Once the fraudster has it, they can use it to access your online account and do with it what they will.
But even if the email is indeed from your bank or lender, it’s never a good sign. It might indicate someone is already actively trying to get into your account. It might indeed be a good time to change your passwords. Just make sure you do so directly from the website rather than from any links. Additionally, look into two-factor authentication to protect your accounts further.
The bottom line
Identity thieves are very creative and resourceful when it comes to tricking you out of your financial information. So creative, in fact, that you might not realize it’s happening. And with synthetic identity theft on the rise, the task of detecting fraud is all the more challenging.
Stay suspicious and look out for subtle signs. Monitor your credit report regularly and keep an eye on your bank and credit card transactions. It might not be a fun routine, but neither is cleaning up the consequences of identity theft. It’s easier to prevent fraud than to deal with its consequences.
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