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Cybercrime is on the rise, with scammers and hackers getting ever more creative at setting online traps to steal your money and identity. Some 42 million Americans were victims of identity fraud in 2021 alone, according to Javelin Strategy & Research. Criminals who engaged in identity fraud schemes stole a total of about $52 billion. Many of those losses stemmed from stolen personal information through data breaches, but the bulk of it stemmed from identity loss scams that targeted consumers directly, such as phishing emails and robocalling.1
Armed with personally identifiable information, criminals can withdraw funds from your financial accounts, file a tax return to collect your refund, open a credit card in your name and rack up charges, and ding your credit by opening a new checking account and writing bad checks.
Staying offline doesn’t help. Consumer Reports notes that criminals can purchase basic information about consumers on the dark web, including their name, address, phone number, birthdate, and even Social Security number. It’s often enough to initiate online access to an existing banking or investment account.2
But there are steps that consumers can take to help keep their digital data secure. Here’s how:
- Register for free online banking and mobile apps to monitor your checking and credit accounts daily. And use two-factor authentication (such as facial recognition to access an online app or a one-time code texted to your phone) to add an extra layer of protection.
- Log in regularly to your online accounts It’s not enough to ditch paper documents and “go green.” You must also secure your account with a unique password and select “challenge” clues, where possible, to recover forgotten usernames and passwords. Consumer advocates recommend against using automatic login features.
- Request a free credit report each year from the three major credit reporting bureaus—Experian, TransUnion, and Equifax.
- Protect your online transactions using encryption software that scrambles information you send over the internet. Not sure if your browser is secure? The Federal Trade Commission urges consumers to look for the “lock” icon on the status bar of their browser, which indicates the personal and financial information they send is secure.3
- Never share your passwords or Social Security number with anyone who does not need to know it. If someone asks you to share your Social Security number, the FTC suggests you ask why they need it, how it will be used, how they will protect it, and what happens if you don’t share the number.
- Avoid phishing emails by not opening files, clicking links, or downloading programs sent by strangers, the FTC urges. It could expose your system to a computer virus or spyware that can capture your passwords.
- Safely dispose of digitized personal information before you trash your computer or give it away, by deleting all personal information stored on the hard drive.
- Rein in your social networking posts the FTC suggests, which can give cybercriminals details they can use to answer “challenge” questions on your accounts and gain access to your money and personal information. Consider limiting access to your networking page to a small group of people.
For consumers who seek to thwart cybercriminals, the best defense is a good offense. Secure your accounts with adequate passwords, keep your personal information private, and monitor your online accounts regularly to keep your assets and identity safe.
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This article was originally published in September 2020. It has been updated.
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1 Javelin Strategy & Research, “2022 Identity Fraud Study: The Virtual Battleground,” March. 29, 2022.
2 Consumer Reports, ”Why a Credit Freeze Alone Won’t Stop Identity Theft,” Sept. 16. 2019.
3 Federal Trade Commission, “Protect Your Personal Information and Data,” May 2021.