Stages of Identity Theft | Identity Theft - A Research Review

The researchers categorized three stages of identity theft. A particular identity theft crime may include one or all of these stages.

Acquisition
Use
Discovery

Stage 1. Acquisition of the identity through theft, computer hacking, fraud, trickery, force, redirecting or intercepting mail, or even by legal means (e.g., purchasing identifying information on the Internet).

Stage 2. Use of the identity for financial gain (the most common motivation) or to avoid arrest or otherwise hide one's identity from law enforcement or other authorities (such as bill collectors). Crimes in this stage may include:

Account takeover.

Opening new accounts.

Extensive use of the victim's debit or credit card.

Sale of the identity information on the street or black market.

Acquisition ("breeding") of additional identity-related documents such as driver's licenses, passports, visas, and health insurance cards.

Filing fraudulent tax returns for large refunds.

Insurance fraud.

Stealing rental cars.

Stage 3. Discovery of the theft—although many misuses of credit cards are discovered quickly, identity theft may take from 6 months to several years to discover. Evidence suggests that the longer it takes to discover the theft, the greater the loss incurred by the victim, who may or may not involve law enforcement. Considerably more research is needed in this area.

National Institute of Justice