How To Identify Employment Identity Theft and What Steps To Take

There are a variety of types of identity theft. Most people think identity thieves are out to drain your bank account, but some are more interested in using your personal data. People with poor employment histories or low employment eligibility may commit identity fraud in order to obtain employment. This type of ID theft uses your personal info to access a variety of employment services.

Learn how to identify signs you’ve been a victim, what to do if you are, and what preventative measures you can take to reduce your chances of becoming a victim of fraud. We'll also recommend the best identity theft protection to stay safe from employment identity theft. 

Employment identity theft defined

Employment identity theft happens when someone uses your Social Security number (SSN) to apply for a job. This can happen for a number of reasons. The person could have entered the country illegally and needs to work even though they don’t have a Social Security number, a person could have a criminal record and be excluded from certain types of employment, or someone’s employment opportunities may need a certain credit score. These are just some, but not all, of the examples why the theft may occur. While it’s easy to blame it on illegal immigration, natural-born citizens can steal someone’s identity as well.

How employment identity theft occurs

It happens any time someone has access to your SSN, birth date, driver’s license (DL) number, or other forms of sensitive information and then uses it to apply for a job. Do a little research and you’ll find that schools or major businesses like Equifax were hacked, so you can see how a lot of that information could be available to anyone willing to pay.

Unfortunately, however, it happens more frequently when a coworker has access to your personal information. You’re much more likely to be victimized by someone you know than you are by a mail thief or dark web hacker.

Signs of employment identity theft

Employment identity theft can be confusing because it’s not your typical form of identity theft. There aren’t likely alerts on your bank account or huge bills on your credit cards. Someone could realistically steal your identity for years without you noticing, especially if you don’t need to file taxes. We’ve compiled a list of the ways you might discover identity theft, but you could also take a proactive approach and check through the IRS once you know what to look for with these suggestions.

1. IRS starts sending documented information. The most obvious signs are going to come from the IRS itself. Since Uncle Sam is always watching, it knows when wages are attributed to your SSN. You may even receive notices about tax discrepancies when you file your taxes.
2. Social security benefits could be revoked due to the appearance of a higher income. Some SS benefits require you to make under a set amount. If someone is working under the guise of your identity, it could impede your real-life benefits.
3. Inability to file taxes. The IRS may not notify you of discrepancies but may block you when you try to file your taxes. If you receive a red flag from your accountant or try to file on your own and get rejected, this may indicate that you’ve been a victim of fraud.
4. You notice you have an Employment Identification Number (EIN) that you didn’t request. When you open a business, you need an EIN for tax purposes. Someone could try to open a business with your information, which would assign the EIN to you.
5. You receive a notification from your identity theft protection company. Notifications, alerts, and flags could include anything from credit inquiries to background checks. If you don’t recognize any of these, you’ll want to check to see if your SSN is being used.
6. Unrecognized acceptance for unemployment benefits. If you suddenly receive unemployment benefits, it could be because another person used your information.

What to do if you’re a victim of employment identity theft

If you discover you’re a victim, it’s important to act quickly and notify all the proper authorities. People who knowingly allow employment identity theft to continue can also be found legally liable.

• Freeze your credit with Equifax, Experian, and TransUnion. (Contacting all three credit bureaus is easier with identity theft protection software.)
• File an identity theft report with the Federal Trade Commission (FTC).
• Report the fraud to your employer.
• File a report with local law enforcement.
• File a report with the Internet Crime Complaint Center (IC3), which is a division of the FBI.
• Contact the Social Security Administration (SSA) to correct your earnings record.
• Set up an identity protection PIN (IP PIN).
• Submit form 14039 (Identity theft affidavit) with your tax return.
• Contact the unemployment office of the state where you’ve discovered the unauthorized unemployment.
• Keep an eye on your credit reports.
• Set up fraud alerts with Equifax, Experian, and TransUnion.

Keep all your personal data safe

Tips to stay safe from employment identity theft

Identity theft is scary and frustrating. The repercussions could affect you for years if you don’t go through the proper channels to report and correct it. In 2022, almost 40 million Americans were victims of identity theft, with women, children, people with high incomes, and the entire 30-39 year-old population being the most likely to become victims.^[1] Prevention is so much better than remediation, so taking appropriate steps to protect yourself could save you a headache later on.

• Don’t give out your SSN unless you have to, including on job applications or medical records.
• Use two-factor authentication (2FA) on all accounts.
• Claim your E-verify account to verify your identity.
• Create a unique password for every account and use a password manager to keep them all encrypted.
• Use biometric authentication whenever possible.
• Lock your SSN and credit.
• Learn more about phishing scams and what they look like.
• Use identity theft protection software with identity theft insurance and remediation assistance.
• Change passwords after a data breach.
• Request that your employee information and other personal data be redacted if possible.
• Let a potential employer know that you’re happy to provide personal information after an employment offer.
• Don’t ignore suspicious activity on credit cards, bank accounts, or other financial institutions

Best identity theft protection services

Using an identity theft protection service can alert you to changes in anything that may deal with your identity. This could range from a social media scam account to employment identity theft. You’ll receive monitoring and real-time alerts for anything from a soft credit pull to address changes to job applications in your name.

The best identity theft protection offers identity theft insurance as well as remediation specialists that will assist you in reclaiming your identity. We love Aura and Norton LifeLock, but there are a ton of other services out there. We suggest using a service that offers a free trial to test if it’s right for you. Identity theft losses can be expensive, but using one of these services could be a lifesaver.

Employment identity theft FAQs

Bottom line

Identity theft is a nightmare. It can have long-standing repercussions that create issues for you down the road. The best thing you can do for yourself is to use an identity theft protection service like Aura or Norton LifeLock to protect yourself and help you get your life back on track after an incident.

You should also take care to use strong security like unique passwords, 2FA, and biometric authentication whenever possible. Protection now can make recovering from identity theft possible in the future.