What Are The Different Types Of Identity Theft?

Florence Desiata

Updated: May 6, 2023

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Identity theft is a growing concern in the digital age. Sharing personal information online can make accessing it easier for identity thieve. Federal Trade Commission gathered about 1.4 million reports of identity theft in 2021 alone. This data is double the number of reports from 2019. 

Identity thieves use another person’s personal information for fraudulent actions. These actions can range from opening fraudulent credit card accounts to filing tax returns in someone else’s name. 

In this article, you will dive into the different types of identity theft and how they can affect individuals and businesses.

Types of ID Theft

Identity theft is a potential risk for anyone at any stage of life. Young individuals are particularly vulnerable to becoming victims of identity theft. 

Identity theft statistics show that the cost of identity theft around the world reached $25.6 billion in 2020.

The following are the most common types of identity theft:

Financial Identity Theft

Financial identity theft is the most prevalent form of identity theft. It occurs when someone uses your personal information for financial gain. 

Consider placing a security freeze or initial fraud alert on your credit reports and reviewing them regularly if you suspect someone has compromised your information.

One real-life example of financial identity theft is the case of David Matthew Read. He pretended to be Demi Moore’s assistant to request a new credit card. He then went on a shopping spree and spent over $169,000

Tax Identity Theft

Tax identity theft occurs when thieves file a tax return using your information. The thief will typically use stolen personal information to file a forged tax return at the beginning of the filing season before you can do so. 

This time frame allows the thief to receive the refund before the IRS processes the legitimate filing. 

An example of this type of theft is the case of Wilmer Alexander Garcia Meza from Waukegan, Illinois. Garcia Meza obtained ITINs from the IRS fraudulently using other people’s personal information.  

Garcia then used those ITINs to file tax returns under the stolen identities, receiving thousands of refunds.

The court sentenced him to 29 months in prison for filing false tax returns using stolen identities. They ordered Garcia Meza to pay restitution to the United States and serve three years of supervised release.

Medical Identity Theft

Medical identity theft involves using your information to receive medical care in your name.

An example of this type of theft is when someone uses your name or health insurance details to perform any of the following actions:

• Visit a physician
• Receive medical treatment or medication
• Submit claims to your health insurance company
• Acquire other products or services.

Medical identity theft damages include a decrease in credit scores, refusal of medical services, higher fees for coverage, and rejection of coverage altogether.

Employment Identity Theft 

Employment identity theft is a type of identity theft in which a fraudster steals another person’s personal information and uses it to gain employment or pass a background check in the victim’s name. 

This type of ID theft can lead to severe consequences for the victim, including damage to their credit and criminal record. It can also take significant time and effort to resolve the issues created by this type of identity theft.

Child Identity Theft

Due to their absence of credit histories, identity thieves often single out children under 16. Criminals may use a child’s personal information to open fraudulent credit accounts or to obtain loans and credit cards in the child’s name. 

Estate Identity Theft

Estate identity theft happens when ID thieves obtain personal identification information (PII) from individuals who have recently passed away and use it to collect tax returns, Social Security checks, and other benefits.

Data from ID Analytics shows that approximately 2.5 million deceased Americans have their identities fraudulently used each year. People use stolen identities to open credit cards, apply for loans, or obtain cellphone services.

Criminal Identity Theft

Authorities consider all types of identity theft crimes, including criminal identity theft, which occurs when someone arrested uses your personal information. Criminals can often get away with this by using a fake or stolen ID. 

Once the consequences demonstrate themselves, detecting this identity theft can become easier.

These consequences include: 

• Receiving court summons
• Being issued a bench warrant
• False criminal records showing up during background check

You can’t prevent Criminal identity theft. Although there is no fail-proof way to do it, safeguarding your ID and quickly reporting stolen cards can be a big help. 

Synthetic Identity Theft

Synthetic identity theft involves creating fake identities using real people’s information such as birthdates, addresses, and Social Security numbers. 

Fraudsters use this fake identity to commit financial crimes such as applying for loans or credit cards. Children and older adults are particularly vulnerable to this type of identity theft due to their infrequent use of their SSNs.

By merging genuine and counterfeit personal consumer data, synthetic identity fraudsters fabricate a new identity to exploit to engage in financial fraud.

Bottom Line

In conclusion, the growing amount of personal information shared and stored online has made identity theft a growing concern in the digital age.

The different types of identity theft can have severe consequences for individuals and businesses, from financial losses to damage to credit and criminal records. Everyone needs to take steps to protect their personal information and be vigilant when conducting transactions that require providing personal data.