4 Things to Know About Identity Fraud in 2022
Modern technology has created a near free-for-all playground available to fraudsters who aim to prey on vulnerable people and smuggle their data. With identity fraud being such a lucrative scam, the need for more sophisticated ways to protect sensitive information is essential to safeguard our identity from fraud. In 2020, cases requiring individuals to report identity fraud resulted in nearly $24 billion stolen, according to a Javelin Strategy and Research study. (1) The same study showed that in 2021, the number of people affected by identity fraud increased by 5 million, leaving 15 million people affected. (1) With these statistics consistently on the rise, it has become imperative that we take the time to understand the threat identity fraud imposes upon us and its impact on our financial health. Here are the top 4 things you need to know about identity fraud in 2022.
Identity Theft Risk is Growing Exponentially
With no signs or chance of slowing down, identity fraud in 2022 will most likely increase in both cases and financial loss. Experts in the field believe that there is a new case of identity fraud every 22 seconds, with 33% of Americans experiencing some form of identity theft. (2) The number of Americans who experience and report identity fraud will probably double or triple in 2022 from the original 33%. (3) Other numbers related to identity fraud include time spent reporting fraud and disputing charges, which may increase in line with other statistics.
Age Plays a Role in Those Who Report Identity Fraud
42.6% of all identity fraud falls within the "baby boomer" generation. (3) These numbers decrease with age and are believed to play a role in the ease with which fraudsters can obtain a person's identity. With ever-changing systems, Identity theft protection evolves faster than many an average user can keep up with. There is a growing need for multi-layered protection like double authorization apps that older generations may find confusing or time-consuming, leaving them open and susceptible to fraud. Social media also plays a large part in identity theft, often utilizing seemingly harmless image posts to gather information. Fraudsters will create images asking users to recall their childhood street name, old phone numbers, and make and model of their first car, all in an attempt to obtain security question information. As the post is shared around, the phishing scheme grows, and more and more information is shared, typically seeing older generations fall prey as they may have trouble understanding identity theft tactics.
Identity Fraud is Expanding
Gone are the days when fraudsters relied only on personal information to steal information and money. However, with ever-expanding technology comes more sophisticated ways to commit fraudulent activities. As stated by the McKinsey Institute, synthetic identity fraud is a type of financial crime growing at alarming speeds within the United States and worldwide. (4) By utilizing only a few small bits of legitimate data, fraudsters can create fictitious identities that don't exist, use them to take out loans, and then disappear. In a report conducted by Experian, fraudsters were utilizing AI to create fake faces to bypass biometric verification systems. (5) With this in mind, around 70% of people trust fingerprint scanning and facial recognition to fight fraud. (1) With the technology existing to recreate faces and other biometric scanning imagery, identity theft prevention becomes even more complicated to navigate. Types of identity theft are also expanding thanks to more of our lives becoming available online. Medical identity theft, social media account takeovers, government benefits, and tax fraud, to name a few.
Identity Theft Day-to-Day Practices for 2022
It is essential to stay up to date with the latest technologies and best practices that help keep information safe. A layered approach is best when considering what tools to use, as single-factor authentication methods often result in fraudulent access to accounts. (6) Using passwords that don't contain personal information like pet names, birthdays or streets is also essential. Solid passwords are suggested to consist of at least 16 characters and include letters, numbers, and symbols with no legible patterns. Passwords, pins, and other account information should never be n paper, left out in the open, or within non-protected documents on a computer. Password lockers encrypted with multiple-step verification processes work best for securing personal account information. Besides these simple steps, education is vital. Keep ahead of the trends being created and utilized by fraudsters by reading up-to-date news articles and reports from reputable sources.
Whether you're a company protecting an entire organization's information or an individual safeguarding your banking account, the threat of identity fraud is the same. Identity theft and fraud are growing crimes that will not slow down soon. Fraud risk can come down to many factors, but age can play a significant role, especially when it comes to older generations understanding new technologies. Fraudsters can attempt theft through the latest AI technology or a simple phishing scam via social media, and there is only safety in prevention. It is also important to note that identity theft and fraud can happen anywhere to anyone. Scams as minor as stealing store reward points and social media accounts are two tiny outcomes that can come from identity theft. Knowledge is the real power that can help prevent fraud. Assuring personal literacy of current protection options, trends, and individual safety measures is essential in today's ever-evolving digital world. Though statistics will probably rise in 2022, you can take steps today to secure your information, mitigate risk, and ensure that there will never come a time when you will have to report identity fraud.