What is Identity (ID) Theft and How to Avoid it?

What is Identity (ID) Theft and How to Avoid it?

8 mins read1.1K Views Comment
Anshuman Singh
Senior Executive - Content
Updated on Aug 31, 2023 09:26 IST

Identity theft can happen in various ways, leaving victims with damage to their credit, finances, and reputation. So, precisely what is identity theft?


What is identity theft?

Identity theft occurs when someone impersonates you and uses your personal information to commit fraud or gain other financial benefits. Your name, home address, email address, passwords, social security number, driver’s license number, passport number, aadhaar number, or bank number are examples of personal identifying information. Thieves who gain access to this information could use it to steal identities or advertise it on the black market.

In this article, we will cover identity theft in depth. But, before proceeding, let’s go through the topics that we will be covering:

Financial identity: This type of theft occurs when one person uses another’s personal information for financial gain. The most common type of ID theft are:

Medical identity: This type of theft occurs when a criminal poses as another person in order to obtain health care services. Fraudsters may obtain drug prescriptions, medical services, and medical devices such as hearing aids using your name and insurance information.

Synthetic identity: This type of theft involves the creation of false identities using real people’s information. Fraudsters may use real people’s birthdates, addresses, and Social Security numbers to create a bogus profile.

Child identity: This type of theft is using a minor’s information to commit financial fraud, such as opening a new account or line of credit in the child’s name.

Criminal identity: This type of theft occurs when a person arrested by law enforcement uses another person’s name instead of their own. They might get away with it if they create a fake ID or use a stolen ID, such as your driver’s license.


Real-life examples of identity theft 

In 2018, a private employee, Naveen Jyothi, filed a police complaint alleging that fraudsters used his personal information to obtain a credit card from the State Bank of India in his name. Fraudsters used the credit card to spend Rs 88,654. Police conducted the investigation, and the fraudsters involved were apprehended.

Kim Kardashian was also a victim of ID theft in 2014. Luis Flores, Jr., 19, called American Express to be Kim Kardashian and modified her social security number and address to his own so he could receive new cards.

How can identity theft happen?

Identity thieves methods have become more complex. Identity theft can occur in a number of ways, such as:

  • Using a data breach to steal electronic records
  • Utilizing online methods, such as adware, malware, spam, etc.
  • Acquiring personnel records from a victim’s workplace
  • Taking wallets or purses to obtain identification, credit, and bank cards
  • Swiping personal information shared on unsecured websites or public Wi-Fi networks
  • Using offline methods, such as dumpster diving, shoulder surfing, bogus phone calls, skimming, etc.
  • Filling out change-of-address forms in order to forward mail containing personal and financial information
  • Posing as a home buyer at open houses to gain access to sensitive information stored casually in unlocked drawers
  • Purchasing personal details from an inside, third-party source, such as a company employee with access to credit applications
  • Digging through mail and trash for bank and credit card statements, as well as other documents containing personal information
  • Phishing for electronic information with bogus emails, text messages, and websites designed solely to steal sensitive information
    You can also explore- What is a Phishing attack?

Signs that demonstrate you are a victim of identity theft 

There are various warning signs of identity theft, and some of those are:

Unusual charges on your bank statement: If you notice any unusual purchases, contact your bank immediately. You may be required to open a new bank account to protect your financial assets.

Unfamiliar credit card charges: Getting caught up in the big picture is easy. However, scammers frequently begin with a small “test” purchase to confirm that your credit card account is active. Detecting these small payments can warn you before they make a massive purchase. If you notice any fraudulent activity, contact your credit card company right away. Reject the transactions and get a new credit card.

Credit cards or loans issued in your name: Most of us recall applying for a new credit card or loan. If you discover that a new line of credit has been opened in your name that you never signed up for, this immediately indicates that you are a victim of identity theft.

Calls to confirm unfamiliar purchases: A call, email, or text message attempting to verify an unknown purchase is a classic indicator of identity theft. Take any of these messages from your credit card company or bank seriously.

You can also explore- What is Email Spoofing & how to prevent it?

Internet fraud: Identity thieves today are experts at launching various cyber-attacks based on your online footprint. Recognizing the warning signs while carrying out your regular online activities is critical to protecting your identity.

Drop-in credit score: Someone impersonating you may use your name to open new credit cards and loans they do not intend to repay. The result? Your credit score will suffer as a result. If you notice a drop in your credit score, look into it immediately.

Unfamiliar medical bills: A scammer can obtain medical treatment using your identity, leaving you with medical bills for services you did not receive. Contact your insurance company if you receive strange or unfamiliar medical bills.

Some of the other signs are:

  • Debt collector calls
  • Checks that bounce
  • Credit score decline
  • Credit reports with hard inquiries
  • Your ID has been misplaced or stolen
  • You are unable to access your account
  • Income that was not reported as yours
  • Using up all of your health insurance benefits
  • When you log in, your account looks different
  • Login attempts to your social media accounts that are suspicious
  • Debt collector calls

How to recover from identity theft? 

Identity theft can take, on average, over six months. The recovery process may include several steps, such as:

Contact the following accounts’ fraud departments: You must report fraud once it has been discovered and it is clear that your identity has been stolen. Speak with the fraud departments of the affected banks and credit card companies. You should also report the theft to your local police department. All of this should be completed within one day of discovering the fraud.

Examine your statements and records: You must be aware of your financial transactions for the duration of the fraud. This entails thoroughly reviewing your financial statements and records.

Detail your movements during the fraud period: Once it is evident when the fraud occurred, you should take measures to document your activities in order to demonstrate that you did not spend the money.

Seek legal counsel from an identity theft specialist: It is prudent to contact a lawyer with as much supporting documentation as possible. Legal counsel is essential at this point because your bank will be looking into you as part of its fraud investigation.

Get in touch with the ITRC: The ITRC (Identity Theft Resource Center) provides free assistance and, therefore, can inform you nearly all you need to learn about identity theft. They provide assistance and detailed instructions on what to do in the incident of ID fraud.

How to protect yourself from identity theft? 

Some of the ways to protect yourself from ID theft are:

Destroy private records and statements: Tear up credit card declarations as well as other papers that consist of private financial information.

Safeguard your mail: Empty your mailbox quickly so that criminals don’t have a chance to steal credit card pitches.

Protect your Aadhaar/Social Security number: It’s the prime target for fraudsters since it delivers them access to financial reports and bank accounts.

Examine your credit report: Examine your credit report thoroughly at least once a year for any suspicious activity. If you find anything, notify your credit card company.

Please don’t leave a written record: Don’t ever end up leaving ATM or credit card receipts behind because they contain personal information that attackers might use.

You can also explore- What is safe browsing & how to turn it on?

Laws in India regarding identity theft

Anyone who uses another person’s electronic signature, password, or other unique identification feature fraudulently or dishonestly will be punished. While no statute defines identity theft, section 66C of the IT Act 2000 provides for up to three years in prison, a fine of up to one lakh rupees, or both.


According to a survey, identity theft is one of the most common consumer complaints. In recent years, data breaches have jeopardized the personal information of millions of people. Following the steps outlined above is best to protect yourself from identity theft.

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What can someone do with your identification number?

An attacker can use your ID number to perform a variety of tasks, such as: Selling your ID on the dark web for quick cash. Committing driver's license theft. Making fake IDs with your ID number, and so on.

What is the most common way an identity thief obtains information?

The most common method for an identity thief to obtain information is to steal your purse or wallet.

How common is identity theft?

According to a 2021 online survey, nearly 90 million people have been affected by identity theft. So, yes, identity theft is a relatively common crime.

Who is most vulnerable to identity theft?

Identity theft is being reported at a higher rate among consumers aged 40 to 69 due to theu00a0lack of awareness of the crime.

What three steps should you take if you've been a victim of identity theft?

File a claim with your identity theft insurance company, notify companies that your identity has been stolen, and contact your local police department.

About the Author
Anshuman Singh
Senior Executive - Content

Anshuman Singh is an accomplished content writer with over three years of experience specializing in cybersecurity, cloud computing, networking, and software testing. Known for his clear, concise, and informative wr... Read Full Bio