Students More at Risk of Identity Theft: Tips and Resources to Stay Protected

Every two seconds there is a new identity fraud victim. The consequences of a credit card swipe, a false bank account, a fake passport or ID, and a fake criminal record can last months, and even years. That is why all students must take steps to protect their personal information and lower their risk of student loan identity theft. The following guide will provide statistics about the frequency of fraud and identity theft in the U.S.; outline steps for students, parents, and educators to protect the privacy of student data; and provide tips and resources to prevent and report student loan identity theft.

STATISTICS OF FRAUD AND IDENTITY THEFT

Technology has opened many doors for identity thieves and fraudsters; email, phone, the Internet, and mobile applications have increased the risk to users’ data privacy. Data collected by the Federal Trade Commission (FTC) show disturbing trends in fraud and identity theft.

In 2017, the FTC received 371,061 identity theft reports, accounting for 13.87 percent of all reports. More than 133,000 reports were concerning information being used to open a new credit card account or misuse an existing account. Overall, there was a 23 percent increase in credit card fraud and a 46 percent decrease in tax fraud.

• Top Seven Identity Theft Categories The top seven categories of identity theft were credit card fraud, employment or tax-related fraud, other identity fraud, phone or utilities fraud, bank fraud, loan or lease fraud, and government documents or benefits fraud.
• Payment Method in Fraud Credit card holders lost $74 million, prepaid card holders lost $40 million, and $57 million was taken from debit bank accounts. Wire transfers accounted for the largest and costliest fraud payment method in 2017 — $333 million from 112,229 wire transfers.
• Fraud Reports and Contact Method Seventy percent of fraud reports involved contact by phone, and in 69 percent of reports the consumer initiated contact. The median amount lost by phone was $720, with an annual total of $290 million.
• Fraud Across Age Groups Individuals aged 20 through 29 reported the highest percentage of fraud in 2017, 40 percent with a median loss of $400. Individuals between the ages of 50 and 59 lost $117 million to fraud — the highest across age categories.
• State Rankings for Fraud and Identity Theft Florida had the highest number of fraud reports per population size, 208,443 reports, with about 993 reports per 100,000 individuals. California had the highest number of fraud reports overall, 225,296. California had the highest number of identity theft reports overall, 55,418. Michigan had the highest number of identity reports per population size, 15,027, with 151 reports per 100,000 individuals.

Access the “Data Book 2017” report by the Federal Trade Commission for more information about 2017 consumer reports received by the FTC.

STUDENT LOAN FRAUD CLAIMS

At the end of 2018, the Education Department had over 139,000 unresolved applications for loan forgiveness and student loan fraud claims. Numerous for-profit colleges, including Corinthian College and ITT Tech, have been accused of making “misleading claims on training standards and job placement rates, and also for using aggressive recruitment tactics,” according to Consumer Reports.

The Department of Education is working on developing new regulations to handle student loan fraud. These new regulations will help “protect borrowers from fraud and protect the federal government from footing the bill for unjustified claims.”

Read this article titled “Student Loan Debt Relief for Fraud Claims Rules Reinstated for Fraud Claims” to learn more.

STUDENT LOAN IDENTITY THEFT

A survey conducted by Javelin Strategy & Research in 2015 found that more than 64 percent of students are not very concerned about fraud and only 22 percent of student victims were notified of identity fraud. Students are at four times greater risk for “familiar” fraud compared to all other consumers. Fifteen percent of students experienced a moderate or severe impact from fraud.

TIPS AND STRATEGIES TO PREVENT STUDENT IDENTITY THEFT

There are many reasons students are especially vulnerable to identity theft; they are young, generally inexperienced with finances, and usually don’t look through their entire bank statement. Many parents have their child on their account, and students don’t keep track of their daily transactions. With students studying away from home, parents don’t know which transactions might be fraudulent. Students, parents, teachers, and schools should use the following tips and strategies to reduce the risk of student loan identity theft.

Tips for Students

Protect your numbers and passwords. Don’t let anyone borrow your credit or debit card. Only provide your Social Security number when absolutely necessary and take precautions when entering PINs and passwords. This also means keeping your Federal Student Aid (FSA) ID private.

For questions about financial aid, contact the Federal Student Aid Information Center at studentaid@ed.gov or 1-800-4-FED-AID — don’t give out personal information over the phone unless you initiated the contact.

Keep your mail secure. Mailboxes at college dormitories and off campus are not secure enough for confidential mail; use your parents’ home address or a P.O. box instead.

Track transactions. Set up transaction alerts to be notified of suspicious account activity.

Be wary of public Wi-Fi. Don’t enter any personal or confidential information over public Wi-Fi — this includes making online purchases.

Build strong passwords — and vary them. Make passwords stronger by taking out vowels and adding in special characters. Avoid using the same password on every website.

Don’t overshare on social media. Identity thieves can mine social media posts for clues to account security questions and passwords.

Tips for Parents

Be aware of how your child’s school protects data. Familiarize yourself with how the school and its organizations request, store, and share student data.

Store documents in a safe place. Keep documents in a safe and shred paperwork that has your child’s Social Security number listed or includes personal financial information.

Don’t write off the possibility of “familiar” fraud. Family members and relatives can take advantage of their relationship with you and your child and commit student loan identity theft.

Educate your child about passwords. Share techniques to build strong passwords, caution them to never share passwords with friends, and keep personal information like driver’s license numbers and Social Security numbers private.

Tips for Schools and Teachers

Develop a data governance plan. The plan should cover data security standards and organizational policies to maintain student data privacy.

Establish security protocol. Each employee should understand his or her responsibilities for complying with security policies. Trainings should be conducted on a regular basis.

Monitor access control. Data must be secured by strong passwords and safeguarded by multiple levels of user authentication. Schools should establish role-based access.

Secure mobile devices. Smartphones, laptops, tablets, and iPads with sensitive data should be secured with strong passwords.

Be careful with email. Teachers and school staff should be wary of sending sensitive information over email. Data that is being transferred should be encrypted and desensitized prior to sending.

Access additional tips by checking out this Data Security Checklist.

RESOURCES AND ADDITIONAL INFORMATION

After students realize their identity has been stolen and/or misused it is critical for them to act fast. Students must take every step required to dispute errors and regain control of their financial identity; the process begins by contacting the appropriate government departments and credit bureaus. The following information and resources will guide students through the process of reporting student loan identity theft.

Who to Contact to Report Identity Theft

U.S. Department of Education Office of Inspector General Hotline Portal | Contact the Office of Inspector General Hotline for cases concerning education funds and student loan identity theft. Students can also download the OIG Hotline Form and mail it to:

U.S. Department of Education Office of Inspector General Hotline 400 Maryland Avenue, S.W. Washington D.C. 20202-1500

Students can obtain assistance by calling the OIG Hotline at 1-800-647-8733.

Federal Trade Commission | Students can report student loan identity theft to the FTC. During the process, students will answer questions, obtain a personalized recovery plan, and receive assistance going through the plan.

Internal Crime Complaint Center | Victims of an Internet crime can file a complaint with the Federal Bureau of Investigation’s Internet Crime Complaint Center (IC3).

Consumer Financial Protection Bureau | Students can file a complaint about student loans concerning financial companies.

Steps to Handling Student Loan Identity Theft

• Place a fraud alert. Contact a credit-reporting bureau such as Equifax, Experian, or TransUnion to place a fraud alert on your credit file. Lenders will be required to take extra identity verification steps prior to approving new credit.
• Learn more about placing fraud alerts with Equifax, Experian, and TransUnion.
• Identify incorrect accounts. Once you receive your credit report from the three credit bureaus, you’ll need to check for errors and accounts that you did not open. 
• Read the article titled “How to Dispute a Credit Report Error in 10 Steps” to learn more.
• Report to the FTC. File an identity theft report by visiting identitytheft.gov.
• Contact the school. The school associated with the loan should know what happened, close the loan, and provide you with a written confirmation.
• Contact the Department of Education Office of the Inspector General. File a report online or with the OIG Hotline at 1-800-647-8733. 
• Use this checklist by IdentityTheft.gov for a more comprehensive plan of action.

Additional Information & Resources

Federal Student Aid | Students can read articles on how to protect their identity, avoid loan scams, and report fraud and student loan identity theft.

Fraud.org | Students can file complaints which are then sent to the FTC and shared with law enforcement personnel across the U.S. and Canada.

Social Security Administration | Access this useful guide to protecting your Social Security number and reporting identity theft.

U.S. Department of Education | Educators and postsecondary school officials can access resources covering data breach response, the Family Educational Rights and Privacy Act (FERPA), best practices for data destruction, and a data security checklist.

U.S. News & World Report | This article outlines four steps to handling student loan identity theft by family members.

TOWARD A SECURE FINANCIAL FUTURE

Victims of student loan identity theft have the law behind them and experienced forensic crime professionals working to find and prosecute the perpetrators. However, a secure financial future is not a given — students must take steps to protect their data and prevent identity theft.

Sources:
Consumer Financial Protection Bureau, Complaint
Consumer Reports, “College Students Face a Greater Risk of Identity Theft”
Consumer Reports, “Student Loan Debt Relief Rules Reinstated for Fraud Claims”
Equifax, “Fraud Alert, Security Freeze, and Credit Report Lock”
Experian, Fraud Alert
Federal Bureau of Investigation Internet Crime Complaint Center (IC3), Filing a Complaint with the IC3
Federal Student Aid, “Federal Student Aid and Identity Theft”
Federal Student Aid, Scams
Federal Trade Commission, “Consumer Sentinel Network: Data Book 2017”
Fraud.org, File a Complaint About Fraud
IdentityTheft.gov
IdentityTheft.gov, What to Do Right Away
IT & Software, Guide to Cyber Security
Javelin Strategy, “$16 Billion Stolen From 12.7 Million Identity Fraud Victims in 2014, According to Javelin Strategy & Research”
Nuvision Federal, “Students Increasingly Victims of Fraud and Identity Theft”
Politico, “Backlog of Student Fraud Claims Grows”
Social Security Administration, “Identity Theft and Your Social Security Number”
Student Loan Hero, “Don’t Let Student Loan Identity Theft Ruin Your Life”
Student Loan Hero, “How to Dispute a Credit Report Error in 10 Steps”
Student Privacy, By Audience: Postsecondary School Officials
Student Privacy, “Data Security Checklist”
TransUnion, Place a Fraud Alert
U.S. Department of Education Office of Inspector General Hotline Portal
U.S. News & World Report, “4 Steps to Handle Student Loan Fraud by Family Members”