Identity Theft & Prevention Flashcards
7 cards from real CFS practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Identity Theft & Prevention flashcards as text
Which of the following is a characteristic of 'bust-out' fraud that involves synthetic or stolen identities?
Answer: Opening accounts and immediately maxing out credit before disappearing
Bust-out fraud involves building credit over time with a fabricated or stolen identity, then suddenly maxing out all available credit lines and vanishing before lenders can react.
A fraudster uses a deceased person's SSN to file a tax return and claim a refund. This is best categorized as:
Answer: Tax identity theft
Tax identity theft involves filing fraudulent tax returns using another person's (including a deceased person's) Social Security number to illicitly obtain tax refunds.
Which data breach notification trigger most commonly affects organizations' obligations under state identity theft laws?
Answer: Unauthorized acquisition of unencrypted personal information
Most state breach notification laws are triggered by unauthorized acquisition of unencrypted personal information, with encryption providing a safe harbor in many jurisdictions.
The practice of 'dumpster diving' by identity thieves targets organizations that fail to properly:
Answer: Shred documents containing personal information
Dumpster diving recovers improperly discarded documents containing PII; organizations must shred or otherwise destroy paper records to prevent this low-tech but effective technique.
Under the Disposal Rule (16 CFR Part 682), covered businesses must properly dispose of consumer report information to prevent:
Answer: Unauthorized access and identity theft
The FTC's Disposal Rule requires businesses that use consumer reports to take reasonable measures to dispose of them in ways that prevent unauthorized access and identity theft.
Which identity theft scenario best illustrates 'true name fraud'?
Answer: Someone uses another real person's actual identity to obtain credit
True name fraud occurs when a thief uses a real victim's actual name, Social Security number, and other identifying information to open new accounts or obtain services.
An organization's identity theft prevention program should include which of the following as a core element?
Answer: Reasonable policies to detect, prevent, and mitigate identity theft Red Flags
The Red Flags Rule requires covered entities' programs to include policies and procedures to identify, detect, and respond appropriately to Red Flags of identity theft.