Types of Identity Theft

Reading time: 5 minutes

Highlights:

• Fraudsters can use a variety of tactics to swipe your personal information
• Be wary of unsolicited emails, text messages, telephone calls or mail asking for personal information
• It's a good idea to regularly check your bank and credit card statements as well as credit reports

Whether it’s the use of a stolen credit card or a hijacked Social Insurance number, odds are you or someone you know has been affected by fraud or identity theft. 

Simply put, fraud is the unauthorized access of your personal information, which may be used for the fraudster’s financial benefit. Identity theft is a type of fraud involving the theft of your information, which is then used to open accounts in your name or file a tax return (and collect your refund).

So what are the most common types of identity theft or fraud? How can you better protect yourself against being a victim? And what are some ways you can detect the fraud? Here are some common types of fraud and identity theft defined, and some actions you might consider to combat them:

Financial fraud and financial identity theft

Financial fraud occurs when someone uses another person's information for financial gain. For instance, a fraudster may use your bank account or credit card numbers to steal money or make purchases. In financial identity theft, your information is used to open a new financial account or receive government benefits in your name. 

Your personal information can be stolen in a variety of ways, including phishing, in which scammers send you messages appearing to be from your financial institution, credit card company or other company you do business with. These messages may tell you there’s a problem with your account or payment information, or that some suspicious activity has taken place, such as login attempts. The goal of phishing is to get you to take the bait, whether that’s logging into your account directly from the message (giving hackers access to your password), clicking on a link, or opening an attachment.

These links or attachments may also contain malware, or malicious software. Those may include computer viruses, which can infect your files, or spyware, which can collect information and data without your knowledge. That information can then be used by fraudsters.

Synthetic identity theft

In synthetic identity theft, fraudsters create fake identities using fake or real information, or a combination of the two. For instance, an identity thief might use a real SIN along with a name that’s not associated with that number. Personal information of children or deceased people may often be used for synthetic identity theft, since that information is not monitored as often.

Tax identity theft

This type of identity theft involves fraudsters getting access to your personal information, which is then used to file a tax return and get a refund – your refund – or GST/HST rebates or refunds.

Keep any access codes, user IDs, passwords and personal identification numbers (PINs) secret. The CRA also recommends choosing your tax preparer carefully. 

Child identity theft

Most children under 18 don’t have credit reports, so it’s possible for a fraudster to open credit accounts in their name undetected. Some child identity theft victims may not discover the fraud until they get older and apply for credit, and find out their credit reports show accounts have been opened in their name (and not paid). 

You can send Equifax Canada a letter asking us to confirm whether your child has a credit report. Please include a photocopy of the child's birth certificate and photocopies of two pieces of your identification (driver's license, passport or other government-issued ID).

If your child has a credit report with fraudulent accounts open, here are some steps you can take:

• Contact your local law enforcement and get a police report.
• Report the fraud to the Canadian Anti-Fraud Centre.
• Contact the fraud departments of companies where accounts were opened in your child's name. Ask them to close the account and send you a letter of confirmation. You may need to provide documents verifying your identity along with your child's.
• Contact both nationwide credit bureaus to alert them to the fraudulent activity.

Senior identity theft

Senior citizens may be particularly vulnerable to identity theft and other types of fraud because they may be more trusting and less able to recognize a scam. The types of fraud they may face are the same as anyone else: financial fraud and tax identity theft, for instance. 

Estate identity theft 

This occurs when a fraudster uses the personal information of a deceased person to steal money or open accounts. 

Criminal identity theft

All identity theft and fraud is criminal, but this particular type means someone who is arrested provides your information to law enforcement -- pretending to be you. You wouldn’t be able to detect this until consequences arise – a speeding ticket goes unpaid, for instance, and a judge issues a bench warrant for your arrest.

What you can do

With any type of fraud or identity theft, a key to minimizing damage is early detection. Here are some steps you can take that may minimize the risk of identity theft:

• Check your bills, accounts and statements regularly. Some criminals may start by making small debit or credit card charges in hopes you won't notice. If you see a charge you don't recognize, contact your bank or financial institution. 
• Check your credit reports from both nationwide credit bureaus regularly. See how to get a free copy of your Equifax credit report. 
• Consider limiting the amount of personal information you share on social media (such as your birthdate).
• Be wary of any unsolicited emails, text messages, telephone calls or mail asking for personal information. Be cautious if you are asked to provide personal information such as your SIN or date of birth over the phone, and don't provide personal information over email or on the Internet.
• Educate the senior citizens you know on how to recognize and respond to potentially fraudulent emails, text messages, telephone calls or mail asking for payment or personal information.
• After a relative's death, make sure the nationwide credit bureaus place a "death notice" on his or her credit reports. See this article on other credit steps to consider after a relative’s death.  

In addition, you could consider placing an Identity Alert or Fraud Warning on your Equifax credit report (and encourage the senior citizens you know to do so as well). These tools can make it harder for someone to open an account in your name. With an Identity Alert, you can add a personal statement and phone number. If you live in Manitoba or Ontario and are applying for credit, this alert requires lenders and creditors to call you and verify your identity before extending credit. If you live elsewhere in Canada and are applying for credit, lenders and creditors are encouraged (but not legally required) to call you before extending credit. 

A Fraud Warning is only available to confirmed victims of fraud, including identity theft. This special statement added to your credit reports will also include a phone number to encourage (but not legally require) lenders to call you before extending credit.