Whenever third-parties use personal identifiers to decide
whether & who to send funds to, there's a risk of identity
theft but the economic costs mean individuals can insure against
its consequences.
Personal identity theft occurs when a criminal uses stolen
personal identifiers to manipulate third-parties into taking
actions under the false belief they are communicating with the
individual whose identity has been stolen. A typical example is the
criminal taking a loan out under someone else's name or
tricking tax authorities into sending a tax rebate to the
criminal's account. The bank will then pursue the identity
theft victim for funds that were sent to the criminal.
The Federal Bureau of Investigation's Internet Crime
Complaint Centre received over fifty thousand reports of identity
theft in 2021, which is 300% higher than in 20191. The total
economic cost in 2021 is estimated to be $278 million, which
amounts to over $5000 per incident1. Typical
