How to prevent identity theft in 7 Steps

Common methods used by identity thieves

Before implementing procedures to protect your accounts payable team or personal information, it’s important to understand how identity thieves operate. Here are the most common tactics:

• Phishing: Phishing is a widely used method by cybercriminals to deceive you into providing them with personal information, credit card details, bank account numbers, or routing numbers. For the first time in 2023, email became the most commonly reported contact method for fraud, surpassing text messages and phone calls.
• Business Email Compromise (BEC): Think of this as phishing, but with a corporate spin. Cybercriminals impersonate executives, partners, or suppliers to redirect legitimate fund transfers into fraudulent accounts. In the US, BEC scams are among the costliest types of fraud, often targeting companies with large financial transactions.
• Hacking: An organised cybercrime group, or individual, may target you to break into your organisation’s network or personal device to defraud, steal, or breach your security systems. Hackers may use spyware, trojans, or malicious software (malware) to gain entry.
• Remote Access Scams: This scam became more prevalent in the workplace after the COVID-19 outbreak. Scammers impersonate employees, suppliers, organisations, or government entities and contact targets via mobile devices or email to gain access to sensitive systems.
• Ransomware: Ransomware is a form of malware used to encrypt sensitive files. Once files or networks are under the scammer’s control, victims are left with a ransom demand to recover their data.
• Document Theft: External perpetrators may work with malicious insiders to steal exposed workplace documents, which can then be used to commit fraud.
• Social Engineering: This manipulation technique is often used before a data breach or theft. Scammers gather background information on targets using social media platforms like Facebook, Instagram, or LinkedIn.

7 steps to prevent identity theft

1. Use strong passwords: Ensure your passwords are complex, using a combination of letters, numbers, and special characters. Avoid using easily guessable information, such as birthdates or common words, and regularly update them.
2. Enable multi-factor authentication (MFA): Implement MFA on all accounts where possible to add an extra layer of security. This simple step can drastically reduce the risk of unauthorized access to sensitive accounts.
3. Monitor financial accounts regularly: Regularly review your bank and credit card statements for any unauthorized transactions. Consumers worldwide are losing billions to fraud, with 59% of identity theft victims reporting losses totaling $16.4 billion in 2021. Staying vigilant can help detect suspicious activity early.
4. Secure personal information: Shred documents containing personal information before disposal, and be cautious about sharing personal details over the phone or online. Criminals often rely on simple oversights to steal your data.
5. Stay vigilant against phishing attempts: Be wary of unsolicited emails or messages requesting personal information. For businesses, this means training employees to spot red flags like suspicious email domains or requests for urgent financial transactions.
6. Keep software and systems updated: Regularly update your operating systems, antivirus software, and applications to protect against vulnerabilities. Cybercriminals often exploit outdated systems to gain entry.
7. Consider credit monitoring services: Credit monitoring services are a valuable tool for detecting suspicious activity early. Many countries offer free or affordable options—in the US, consumers can request a free credit report annually from each of the three major credit bureaus: Experian, Equifax, and TransUnion.