According to a report by the Identity Theft Resource Center (ITRC), 2021 will see a continued escalation of identity thefts at the same time that government support for victims is declining. The convergence of these two trends makes ID theft protection services even more important than ever.
Government Resources and Funds Disappearing
ITRC cited the significant reduction in government resources focused on ID theft victim services and funds from 2018 to 2020. During that period, Department of Justice funds allocated for identity crime victims dropped from $3.7 billion to $1.9 billion, with the majority of funds provided to law enforcement agencies to administer. Victim services organizations saw funds provided to them decrease from $311 million in 2019 to $144 million in 2020. Perhaps most telling is the fact that funds for victims of all financial crimes, including ID theft crimes, scams, fraud, etc., have been completely eliminated. What makes these findings particularly disturbing is the ongoing increase in ID theft and new ways in which unsuspecting victims are being targeted.
Losses Up
According to Comparitech, in 2019 alone, consumers sustained losses totaling $3.5 billion due to financial fraud/ID theft incidences. Account takeovers increased 72% that year and 2020 data is equally concerning. Javelin Research’s 2020 data found that 40% of account takeovers occur within 24 hours of a cyber criminal’s access to a victim’s account. While the introduction of EMV chip credit cards has had an impact on these crimes, fast moving criminals can do a lot of damage when they do access an individual’s credit card information. Within minutes, the data is sold on the dark web for as little as $.50 per card to as high as $20 per card – sometimes as high as $60 per card. Most Americans know at least one person who has been a victim of identity theft or they themselves have been.
New Crimes
Cyber criminals are using new ways to steal individuals’ identities. Many are targeting accounts that require logins and passwords for corporate network access using ransomware or sophisticated email scams. These are easy to implement, automated attacks with a lower risk of being caught and a higher reward over targeting single individual accounts. The ITRC estimates that average ransomware payouts for businesses have risen from less than $10,000 per attack in the third quarter of 2018 to over $178,000 per incident in the second quarter of 2020. The pandemic has only fueled these attacks with remote working making corporate networks more vulnerable than ever.
ID Theft Resources
Most Americans are aware of the various ID theft resources on the market today. Names like LifeLock, IdentityGuard, Norton Identity Protection are just some. Employers, however, are also looking at holistic solutions such as CyberScout (www.cyberscout.com, Scottsdale, AZ), which includes LifeStages® and FraudScout® products and is provided to both single- and multi-employer groups nationwide. LifeStages is a robust identity management service that includes providing customers with personalized attention from a fraud specialist on a 24/7 basis. FraudScout gives individuals the option of additional credit monitoring and risk minimization services to complement LifeStages.
CyberScout is a leader in identity and data defense services. The company has a proven track record working with Amalgamated Life Insurance Company and 16 of the top insurance companies in the nation. For employers and plan sponsors, when selecting an ID theft solution to offer employees/plan members, it is important to make sure that the solution is comprehensive with all of the most important features and is competitively priced. Given how widespread identify theft has become, ID theft solutions are fast becoming a staple in many business’ employee voluntary benefit programs.