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With all the data breaches that took place last year, it would be logical to expect cases of identity theft to skyrocket. But that didn’t happen, according to the 2015 Identity Fraud Study by Javelin Strategy & Research released on Tuesday.
The number of identity fraud cases reported and the amount of money stolen in 2014 were both down from the year before, but not enough to declare any sort of real victory against this crime spree.
“The occurrence of identity fraud hasn’t changed much over the past year, and it is still a significant problem,” said Al Pascual, director of fraud and security at Javelin.
An estimated 12.7 million Americans experienced some sort of financial identity theft in 2014, down three percent from 2013. This fraud ranges from a stolen credit card to a thief accessing an existing bank account. Put another way, there’s a new victim in this country every two seconds.
“It’s like we’re spinning our wheels,” Pascual told NBC News. “We did all this work to reduce the fraud risk and all we got was a three percent decline in victims. That is not acceptable.”
There was a significant drop in the amount of money ID thieves were able to steal, down 11 percent from $18 billion in 2013 to $16 billion last year. The report credits “the combined efforts of industry, consumers, and monitoring and protection systems” that are catching fraud more quickly.
“We did all this work to reduce the fraud risk and all we got was a three percent decline in victims. That is not acceptable.”
Another bit of good news: The most damaging type of identity theft, new account fraud, continued its three-year decline and hit a record low in 2014.
New account fraud is when an ID thief opens an account in another person’s name, often using a stolen Social Security number. This type of fraud is hard to detect, so it can result in serious financial losses and damaged credit histories. On average, the misuse of these new accounts lasted for 130 days.
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“When someone takes over an existing account, it’s easy to correct that, you just close the account,” said Stephen Coggeshall, chief analytics and science officer at LifeLock, which sponsored this study. “If someone has your Social Security number and date of birth, they can open up new accounts from here to eternity in your name and it’s very hard to stop.”
The reports noted that new account fraud may be on the decline because so many credit and debit card numbers have now been breached. Criminals find it easier to use these stolen account numbers rather than trying to open new accounts.
“Despite the positive news this year, we expect new account fraud to trend upwards this year and next,” Pascual said. “You don’t steal 80 million Social Security numbers from Anthem to just sit on them.”
Other significant findings:
- Most of the students surveyed (64 percent) said they had very little concern about this sort of fraud. And yet, they are the most likely to be severely impacted if their personal information is stolen.
- Many fraud victims (28 percent) avoided certain merchants as a result of their experience and 22 percent of these victims avoided large retailers.
- Those who had their credit or debit card number breached last year were nearly three times more likely to be an identity theft victim.
“This highlights the need for increased security, vigilance and quick response by retailers,” the report concluded.