Identity Theft Predictions for the Coming Year
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Part of the job of the Identity Theft Resource Center is to analyze the criminal trends and victim calls to uncover where identity theft and its related crimes will lead in the days ahead. As we finish out 2015 and move into a new year, these predictions—while we hope they don’t come true—are at the top of our list:
1. Child Identity Theft Will Increase – One of the fastest growing forms of identity theft is child identity theft, affecting as many as ten percent of children and young people, according to one study. Unfortunately, this crime used to be relegated to those in your family’s inner circle who “borrowed” your child’s identity for financial purposes, but now we’re seeing an increase in hacking and data breaches that specifically target children.
Fortunately, headway is being made in halting the advance. Kentucky became the most recent state to propose legislation that would allow parents to place freezes on their children’s credit reports if fraud has been suspected; this would bring the total number of states with this kind of law to 23 if it passes.
2. Tax Refund Fraud Will Shift – The IRS met with key lawmakers, tax experts, and tax preparation software publishers this year to try to curb the nearly $6 billion in fraudulent refunds that get paid out every year. With stricter controls like stronger user passwords, alerts for information changes, alerts for multiple returns filed from the same computer, and two-step authentication, the goal is to make federal tax refund fraud not worth it for criminals, and much more difficult to commit.
Unfortunately, that means our prediction is that state tax refund fraud will increase as federal fraud decreases. Thieves currently file state returns on the same Social Security number in several different states, and with the cash cow of federal refund fraud stripped away, they’ll have even more incentive to attack the state departments of revenue. Until states have some form of unified structure for red flagging the multiple filings, this trend may continue to grow.
3. Tighter Controls on the Internet of Things – There’s little doubt that IoT innovation is very exciting. With everything from devices that are merely more convenient to devices that are truly life changing, so-called “smart” devices will continue to shape the future.
However, in 2016 we predict that consumers will start to ask a lot more questions about what personal data is gathered from these devices, how that data is stored, and what the companies can do with it legally. The bright, shiny honeymoon period might be coming to and end, the time when consumers were simply amazed by the possibilities. Now, IoT users are more savvy and more cautious, and in the coming year there will be a lot more emphasis on protecting our privacy from 24/7 internet connectivity.
Whatever the coming year brings for identity theft prevention, we’re certain that consumers will play a bigger role in their own protection than ever before. The volume of calls to the ITRC’s 24-hour toll-free call center has yet to slow down, but there’s a broader understanding of how to protect ourselves and our data.