Third-Party Identity Fraud

Third-party identity fraud refers to a fraudulent act where a person’s personal information is stolen and used by an unauthorized individual, typically for financial gain or other illegal purposes. In this type of fraud, the victim’s identity is misused without their knowledge or consent by someone who is not directly involved in the initial act of stealing the information.

The fraudster gains access to the victim’s personal data, such as social security number, credit card details, or other identifying information, through various means, including data breaches, phishing, or hacking. Once in possession of this information, they can open new accounts, make unauthorized transactions, obtain credit or loans, or engage in other fraudulent activities, all under the victim’s name. The victim remains unaware of the fraud until they discover unauthorized charges, receive debt collection notices, or face negative consequences like damage to their credit score. Third-party identity fraud not only causes financial harm to the victim but can also lead to reputational damage and ongoing legal and administrative burdens to resolve the fraudulent activities associated with their stolen identity.