Identity Theft in the Digital Age: Risk Factors, Preventive Measures, and Policy Implications

In the digital age, identity theft is a big challenge. According to FTC (2021), there were 1.4 million cases of identity theft reported from 2019 to 2021 (increase of 113%) in the United States. Along with financial losses (average $9,000 per incident for older adults) victims experience emotional and psychological harm including anxiety and stress. While technology is advancing new approaches, struggles are huge due to the underlying issues of demographic disparities and systemic vulnerabilities in communities. The lack of effectiveness of our current prevention programme made it difficult to combat identity theft. This literature review based study analyzed key findings of empirical research showing the effect of demographic risk factors (e.g. individuals aged 20–39 being more susceptible) and the difficulties in overcoming AI driven phishing schemes. This study examined possible preventive strategies such as document shredding (15% decrease in risk) and multi factor authentication. It also addressed the limitations to mitigate root causes. This study highlighted the importance of robust regulatory frameworks, public private partnerships, and creative solutions in reducing identity theft and presented actionable policy development and future research.