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American adults lost a total of $43 billion to identity fraud in 2023, according to a new report cosponsored by AARP.
That includes $23 billion lost to traditional identity fraud, which affected about the same number of people—15 million—as in 2022 (when the number was 15.4 million). But total losses grew by 13 percent last year, according to the report, “Resolving the Shattered Identity Crisis,” produced by Javelin Strategy & Research.
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Scams orchestrated by criminals resulted in just over $20 billion in fraud losses to victims.
The increased per capita losses suggest that criminals are “aiming for larger payouts once unauthorized access to a consumer’s new or existing account has been achieved,” the report surmises. And those losses — determined through an online survey of 5,000 Americans 18 and older — are likely just a fraction of the true cost of identity fraud, because these crimes are notoriously underreported.
“We know that there is always going to be a certain number of victims who don’t report it, and it has a lot to do with the stigma against fraud and scams,” says Suzanne Sando, Javelin’s senior analyst in fraud and security and the author of the report. “We need to have better support from the right entities so victims feel comfortable and safe coming forward.... There should be no shame or embarrassment with this.”
Traditional identity fraud occurs when someone obtains someone else’s personal information, such as a Social Security number, home address, date of birth or bank account data, and uses it for fraud or other illicit purposes. A criminal may use your information to access your bank account, for instance, use your credit card for purchases or pretend to be you in order to open up a new credit card or bank account.
The problems of account takeovers and new-account fraud, where criminals use a victim’s personal information to open fraudulent new accounts, are growing, Javelin reports. Account takeover fraud resulted in nearly $13 billion in losses in 2023 (up from $11 billion in 2022). New-account fraud reached $5.3 billion (compared with $3.9 billion in 2022). The Javelin report notes that consumers’ online presence on social media and other platforms “is putting them at increased risk of having multiple accounts taken over by a criminal.”
How identity fraud occurs
There are different ways that criminals can access your personal information. They include identity fraud scams, where criminals influence a consumer to expose sensitive data, often by misrepresenting themselves. They may do so through phishing attempts, where scammers send emails “fishing” for personally identifying information and/or including links containing malware that can infect your device and steal data. These commonly are in the form of impersonation scams, where you’ll receive calls, emails or texts spoofing a government agency, law enforcement, a delivery service or your bank, for example; the impostor will attempt to elicit your Social Security number, account number or other sensitive information they can use to perpetrate fraud.
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