Cybercriminals continue to target personal and financial information, making identity theft and fraud an ongoing concern for consumers. In 2024, the Federal Trade Commission received more than 1.1 million reports of identity theft. Consumers also reported losing more than $12.5 billion to fraud, a 25% increase from the previous year. By 2025, reported fraud losses climbed even higher to nearly $16 billion, highlighting just how quickly scams and identity-related threats continue to evolve.
What is Identity Theft?
Identity theft involves a thief acquiring another person’s personal information, such as their Social Security number, driver’s license, birth and death certificates, bank account PINs, and other items that could be used to commit a white-collar crime. The most common uses of identity information include writing bad checks, draining bank accounts, opening a line of credit, and making online purchases.
In 1998, Congress passed the Identity Theft and Assumption Deterrence Act, making identity theft a federal crime. Depending on what the personal information is used for, identity theft convictions carry a 15 to 30-year prison sentence. Despite the risk of significant jail time, identity theft criminals continue to threaten hard-working people daily.
6 Common Types of Identity Theft
1. Financial Identity Theft
Financial identity theft occurs when an unauthorized individual uses information such as a Social Security number, birth certificate, or driver’s license to create checking, savings, or credit card accounts. The fraudster typically opens these accounts in the victim’s name. The criminal then assumes your identity to complete a variety of transactions.
Initially, the scammer may deposit money into accounts and make on-time credit card payments. This allows them to increase their credit card bandwidth or apply to other lenders or retailers.
Once the accounts are sizable enough to make the federal crime worth risking a prison sentence, cards are maxed out, and bad checks are written. Because these debts are not under the user's real name, creditors initially target the victim with collection actions.
2. Medical Identity Theft
Medical identity theft involves much of the same personal information used in financial crimes. Fraudsters typically use your name and Social Security number, coupled with insurance data. Filing unauthorized claims using private health insurance policies has paled compared to Medicare and Medicaid fraud. A 2023 CNBC news report indicated taxpayers lost upwards of $100 million annually due to Medicare and Medicaid abuses.
Along with purchasing prescription drugs, identity theft operations are putting in claims for unnecessary medical equipment. These expensive products are typically resold below market value for cash on the black market. While the federal government is, again, trying to crack down on medical identity theft, criminals have gone on the record stating that Medicare fraud is easy and they only need documents such as health insurance cards to get started.
3. Online Identity Theft
A hacker sitting in a café halfway around the world may be trying to burglarize your cell phone or another device to steal your personal identity information right now. That statement would be less frightening if it weren’t true. We hear about hackers from other countries trying to bring down American infrastructure or spy on the government regularly. But what flies under the radar—to some degree—is the fact that digital identity theft is big business.
Not only will a cyber criminal in a foreign land go unpunished, but these digital thieves relentlessly dream up new ways to outflank anti-virus software and firewalls. The most common way digital thieves steal personal information involves “phishing.”
This phony email scam has proven to be an effective way to make hard-working people feel a sense of urgency. Then, they provide usernames, passwords, and other identity information to the wrong individual. Once inside your device and digital accounts, hackers sell credit cards, bank account information, and Social Security numbers on the Dark Web.
4. Criminal Identity Theft
It may seem impossible, but some criminals are so brazen that they will double down after being arrested. It's not uncommon for identity theft criminals to be involved in wide-reaching schemes. Some boldly present themselves as someone else when they get caught for something else.
Having a driver's license with a replaced picture or matching the description can sometimes fool law enforcement. If the felon also knows your Social Security number, getting processed and arraigned is merely a nuisance for them. The impostor quickly skips bail and town. The court will likely issue a warrant for failing to appear in the identity theft victim's name. Yes, having your information stolen can lead to your arrest!
5. Synthetic Identity Theft
Although this crime seems more challenging to commit than other types of identity theft, it occurs too often. Synthetic identity theft requires someone to gain access to multiple personal records. The goal is usually to create a new and elaborate identity that allows criminals to evade law enforcement or orchestrate misdeeds with impunity.
A false persona can be created by combining items such as a birth certificate, Social Security number, driver's license, etc. Criminals may go as far as to take out a mortgage, car loan, or credit card and live under your name indefinitely. When the jig is up, creditors and police could question you.
6. Child Identity Theft
It’s important to keep in mind that adults are not the only targets of identity theft. Minors — particularly those who are 16 years and older — have become a focus. Criminals understand that parents start to teach financial responsibility and may even make them authorized credit card users. Teens 16 and older often have driver’s licenses, a prime resource for fraudsters.
Scammers who latch on to the personal identity records of minors can go to work setting up a false persona, open a variety of accounts, make purchases, and apply for individual credit cards at the age of 18. The thieves are not concerned about interest rates or loan terms because the victim will have to unravel the debt once they have skipped out.
Ways to Protect Yourself from Identity Theft
Criminals have seemingly endless schemes to steal personal information from unsuspecting individuals. People must remain vigilant to prevent hackers from breaching electronic devices and carrying out physical thievery. These are ways you can better protect yourself from identity theft.
- Do not respond to electronic messages that ask for personal information, usernames, or passwords.
- Hang up the phone on callers who ask for bank accounts, credit cards, or debit card donations over the phone.
- Never share your full name, address, email, Social Security number, driver's license, or passport information with a caller claiming an emergency.
- Use unique passwords.
- Sign up for electronic statements.
- Shred papers statements before disposing of them.
- Avoid using public Wi-Fi with personal information.
- Consider adding a Virtual Private Network (VPN) to your phone plan.
- Protect your PIN from prying eyes when using ATMs, purchasing gas, and other payment stations.
- Avoid carrying multiple identity documents in your wallet or purse.
- Request the post office hold your mail while you are away or on vacation.
- Carefully assess all credit card and bank account statements and question suspicious or unauthorized charges.
- Store Social Security cards, birth certificates, marriage documents, banking records, and others in a secure place. A home safe or lock box makes it difficult for thieves to gain access.
- Monitor your credit to catch early signs of identity theft.
- Keep your software updated regularly.
CCCU Is Here to Provide Helpful Resources
It’s important to understand the mindset of hackers and fraudsters when considering protecting yourself and your loved ones from fraud. By hardening your defenses and remaining vigilant in the following ways, criminals are more likely to try elsewhere.
At Consolidated Community Credit Union, we take your security seriously. Providing you with information that can protect you from fraudulent activity and identity theft is important to us. Check out our Identity Theft and Fraud Prevention page; it's filled with helpful tips and information you can use now.
