Persuasive Trigger ~ Blockchain Technology to Control Identity Theft

Technology has certainly made our lives more comfortable, but it has also introduced new dangers such as identity theft. Identity theft is increasing at a terrifyingly rapid pace to the extent that it is the top complaint from most consumers. Also, it is estimated that a case of identity theft takes place every two seconds. Moreover, only 9% of identity theft victims have reported this issue to the police.

In the United States alone, about 60 million individuals were the victims of identity theft in the year 2017. Even with these alarming statistics, many people might not know the meaning of identity theft. Most might not even realize that they were a victim of it until it was too late.

What is Identity Theft?

While we do need to take urgent steps for protecting our identities and data, a higher priority is to understand this concept. The definition of identity theft is stealing and using one's data (without their consent or knowledge) and then using it to get confidential information. Once this is done, the perpetrator can go ahead with their criminal intentions, such as cleaning out bank accounts or other types of fraud.

This is why we need to protect our data from potentially malicious users. While this is a challenging task, it is possible to take some steps in the right direction. We need to educate ourselves by looking at the kinds of identity theft out there but let us first look at how serious the issue is today.

Identity Theft Has Become a Common Curse

There are several strains of identity theft in the world, with some being more common than others are. Data breaches are a significant chunk of these crimes. These occur when a person with malicious intent accesses an organization's records of its customers. This action, if successful, ends up giving the criminal the full names of real people, along with very personal information such as home addresses and Social Security numbers.

The Identity Theft Resource Center has published information on data breaches in the United States. With about 1,579 breaches in 2017 alone, about 178 million records were exposed in that year. One of the biggest and most shocking ones was Equifax, which is among the top three credit reporting agencies.

Around 147.9 million people were put at risk due to this exposure. The leaked information was extremely sensitive and could easily have been used for multiple cases of identity theft.

Identity Theft and Fraud

The Federal Trade Commission is a government agency that is in charge of complaints about identity theft. According to them, the common types of identity theft include the following:

Tax or Employment

This kind of identity theft makes up more than a third of all cases (around 34 percent). It occurs when the perpetrator makes use of someone's Social Security number as well as other sensitive data to get themselves a job or an income tax return.

Credit Card

We might be more familiar with this term in cases of identity theft, and with good reason. This kind of identity theft makes up around a third or 33 percent of all identity theft cases. It takes place when a criminal uses people's credit card or their credit card number for making purchases.

Utilities

These cases of identity theft make up about 13 percent of total cases. Here, someone uses another's personal information for opening a utility account or a wireless phone. These could then potentially become evidence against the victim in case the criminal was using the accounts for malicious activities.

Bank

This type of fraud is 12% of all identity theft cases. It occurs when a criminal uses another's personal data to either take over the latter's bank accounts or open a new account.

Lease or Loan

Comprising of 7 percent of all identity theft occurs when someone's personal information is misappropriated to secure a lease or loan. As a result, the victim is held responsible for the pending payments if the issue is not resolved.

Benefits Fraud

This is also known as government documents'' fraud and makes up 7 percent of all identity theft issues. It occurs when a person uses someone else's information to gain government benefits.

Blockchain Technology Prevention

Since so much of identity theft is tied up with cybersecurity risks, it might be blockchain technology that supplies a solution. Many have considered blockchain for security from such crimes, as this technology is quite powerful.

Blockchain has the potential to keep sensitive information safe, even from the most malicious hackers. Thanks to its sophisticated features that could help to control and prevent identity theft as a whole.

How it works

Blockchain has a decentralized ledger that holds digital assets. Some immensely powerful cryptographic keys secure these assets, making it exceedingly difficult for any hacker to access and use the data inside.

The data itself is on several different computers that form part of the blockchain network. If any attackers want to access these assets, they have to break into each system and take over the network. Such a task is almost impossible.

If hackers do get access to the whole network, they cannot make any data changes without being caught. Any changes will be noted in every system, instantly alerting all participants on the blockchain. As a result, we can say that blockchain is one of the unique ways to secure data.

Blockchain technology also helps individuals support their data storage by enabling them to be in charge of their documents. They can store all sorts of information about themselves, including driving licenses on the blockchain network. This helps them create a self-sovereign or independent identity.

What's more, the all-encompassing register in blockchain gives each person a unique code. This code is highly challenging to hack. Even if it is, no one can amend anyone else's data without leaving a telltale digital footprint behind.

With the data secured in this manner, you can access your data and use it easily by entering your authentication keys.

Final thoughts

Blockchain is still undergoing development. However, it has a lot of potential for securing data safely. Of course, the people in charge might feel hesitant about using modern technology for such sensitive information. However, current practices are not enough to prevent identity theft anymore. It is worth taking a small risk to try out blockchain technology. Therefore, we may expect such a practice to become common quite soon.

References:

https://www.consumeraffairs.com/finance/identity-theft-statistics.html

https://www.idtheftcenter.org/data-breaches/

https://www.idtheftcenter.org/2019-data-breaches/

https://www.identityforce.com/blog/identity-theft-odds-identity-theft-statistics

https://money.cnn.com/2014/02/06/pf/identity-fraud/index.html