In 2020, identity theft was up by 113% compared to 2019. The Federal Trade Commission (FTC) estimates roughly nine million Americans have their identities stolen each year. Are your employees a part of this number? If so, how are external digital threats to your employees impacting your organization?
Though it is easy to think of identity theft as a personal issue, its ramifications can create even bigger problems—problems that may seep into your business. Learn what identity theft is, and what consequences victims of identity theft can face.
What Is Identity Theft?
Identity theft is when someone steals your employee’s personal information (address, credit card/bank account numbers, SSN, passwords, etc.) to commit fraud.
Cybercriminals can gain access to personal information through a variety of methods including:
Stealing one’s mail or other documents that carry confidential information
- Skimming one’s debit or credit card
- Phishing to trick the individual into downloading spyware/malware or providing their financial information
- Purchasing information on the dark web
- Acquiring personal data via data breach or exfiltration
- Hacking into online accounts with the intent to steal login credentials
They then use this information to commit fraud, unbeknownst to the victim, such as:
- Making unauthorized transactions or purchases
- Applying for credit cards, loans, or medical benefits
- Avoiding arrests on outstanding warrants
5 Consequences Identity Theft Victims Face
The negative repercussions of identity theft can last anywhere from a few days to several years, depending on what the criminals do with the stolen information. Here are five main consequences identity theft victims can face:
1. Financial Loss
Perhaps the most palpable ramifications are the financial losses. These can manifest in ways including:
- Debt: Victims may face large amounts of debt due to identity theft. The identity thieves may drain bank accounts, leaving no way to pay bills or deal with expensive penalties and overdraft fees.
- Damaged credit: The information a cybercriminal steals (e.g. SSN, bank account number) can be used to hurt credit scores. This can cause meaningful roadblocks for people, such as the inability to obtain a loan or facing increased auto and home insurance premiums. Financial losses can also impact the work-life of employees of businesses, as they may be focusing on rectifying their personal situation rather than their professional obligations.
- Criminal record: If a criminal decides to use an employee’s identity to commit crimes, your employee’s identity may be permanently compromised by association as a result.
- Legal fees: Trying to undo all the damage from identity theft quickly becomes expensive, sometimes prohibitively so. Depending on the complexity of the identity theft, it may merit legal advice, which incurs further costs.
2. Family Safety
When a hacker exposes and uses an employee’s data, this not only puts your employee in danger, but also their family members. More than 1.25 million children were identity theft victims in 2020. This cost the average family over $1,100.
Children are easy identity theft targets. They use mobile apps and games, so their accounts offer many opportunities for identity theft. In addition, their social security numbers offer a blank slate—no credit history. Cybercriminals can create synthetic identities with the SSN to their advantage.
Business leaders must consistently be mindful of the big-picture impact identity theft can have on their employees. It doesn’t simply impact their professional reputation but their personal lives as well.
3. Emotional Stress
No one deserves to have their identity stolen. Identity theft can be a difficult and bitter pill to swallow.
Victims may undergo various emotions such as shock, anger, fear, shame, and anxiety. These emotions may harm a victim’s mental health and relationships with loved ones.
- 69% of victims felt fear
- 50% said they felt powerless
- 29% said they felt shame or embarrassment
4. Physical Stress
Emotional stress can also affect one’s physical health. According to the Identity Theft Resource Center:
- 41% of identity theft victims have trouble sleeping.
- 29% develop physical symptoms such as body aches, heart palpitation, sweating, and stomach issues.
5. Professional Safety
Cybercriminals may gain access to your employees’ professional information/credentials as well via identity theft. Thus, your organization can be put directly at risk.
Malicious attacks are often done on high-level/executive individuals, as they possess the most confidential information—92% of executives have had their credentials exposed. Cyberattacks made on executive leaders can lead to other ramifications, such as reputation damage.
Read how identity theft affects your business.
Rely on Digital Risk Protection Platform
As a business leader, it’s your responsibility to safeguard your employees’ identities. A robust digital risk protection platform can help you achieve this.
Software platforms such as Constella Dome provide full visibility of your entire workforce and external digital footprint. Continuously monitoring thousands of public and proprietary data sources for malicious activity, Constella Dome allows you to proactively defend your people with the help of identity threat intelligence, that alerts you when personal information has been stolen.
We also encourage you to regularly speak with your employees about cybersecurity, and encourage them to be vigilant about the ramifications of malicious attacks. Cybersecurity must be a company-wide initiative to establish an effective long-term resilience strategy.