Understanding the different types of identity theft and what to do in each scenario.
In this topic, you'll learn:
Fixing the damage done by identity thieves can be as simple as disputing unauthorized charges on a credit card and requesting a new account number. On the other hand, if an identity thief has opened new accounts in your name, an extended effort on your part may be required to repair the damage done to your credit rating.
Here are a few common identity theft scenarios, along with suggestions for recovery:
Scenario 1 - Unauthorized Charges on Existing Accounts
Noticing an unusually low bank account balance or finding unrecognized purchases on your credit card statement is a sign of the most common type of identity theft - unauthorized use of your credit account. If a thief steals your credit or debit card (or the numbers), the damage can be relatively easy to fix, but you need to notify your financial institution as soon as possible in order to limit your liability for these amounts.
As soon as you notice the unauthorized charges contact your financial institution and explain your concerns. They will cancel the card and possibly issue a provisional credit of the charges. They will then ask that you identify the unauthorized charges and may ask you to sign a statement attesting that you did not make the charges.
If unauthorized checks are being written from your account, you will need to stop payment on any outstanding checks and close the checking account. You will also want your bank to report the fraud to ChexSystems, a reporting agency similar to credit reporting agencies.
If you have automatic payments tied to an account that is closed (phone, gym, insurance, etc.), be sure to update the account information with the merchant to avoid late fees or service interruptions.
Scenario 2 - New Accounts Established in Your Name
If you don't monitor your credit reports, the first sign of this type of identity theft could be a call from a debt collector, or you could be denied a credit account that you would ordinarily expect to receive. No matter how you find out that your identity has been compromised, it is important to take immediate action to limit the damage and to begin the recovery process.
Here are the steps you should take to fix the problem:
Step 1: Notify the credit bureaus (Equifax, Experian, and TransUnion) and place a fraud alert in your file. As soon as you realize that there is a problem, you will need to place fraud alerts in your credit file. A fraud alert can make it more difficult for criminals to establish new accounts since the creditor will be required to call you first. If you contact one bureau, they will also report the alert to the other bureaus, but it is a good idea to follow up with each bureau to verify that the alert is in place.
An initial fraud alert stays in your file for at least 90 days. An extended alert stays in your file for seven years. To place either of these alerts, a consumer reporting agency will require you to provide appropriate proof of your identity, which may include your Social Security number. If you ask for an extended alert, you will have to provide an identity theft report. An identity theft report includes a copy of a report you have filed with a federal, state, or local law enforcement agency, and additional information a consumer reporting agency may require you to submit.
You may also place an optional security freeze on your credit reports, which is designed to prevent a credit reporting agency from releasing your credit report without your permission.
Please note that some credit bureaus will attempt to sell you fee-based services when you report identity theft. You are not required to purchase any additional services in order to fix the damage of identity thieves.
Finally, you will need to ask that the fraudulent information be removed from your credit reports. In order to remove the inaccurate information, the credit bureau may need documentation from law enforcement and the Federal Trade Commission (see below).
Step 2: Contact law enforcement and government agencies. Reporting the identity theft to your local police department is generally recommended as an important step in the recovery process. Supply the police with as much information as possible and make sure all fraudulent accounts are listed on the police report (also known as an "identity theft report"). You will need a copy of their report for creditors of the stolen accounts. Make sure to keep the contact information of your investigator - it may be needed by creditors or credit reporting bureaus.
Identity theft reports may be made by local, state or federal agencies. If for some reason you are unable to get an identity theft report from your local police or sheriff's department, there are other options listed at the Federal Trade Commission website at https://www.identitytheft.gov. You will also want to complete the Identity Theft Affidavit form from the IRS. This form is accepted by many creditors and debt collectors, and you are likely to need it later.
If an identity theft scheme has involved the mail, notify your local postal inspector. If your Social Security number has been used, notify the Social Security Administration.
Step 3: Close fraudulent accounts. Contact the security or fraud department of each company where you know, or believe, accounts have been tampered with or opened fraudulently. Follow up in writing, and include copies of supporting documents such as your identity theft report, FTC affidavit, and any other documentation. It's important to notify credit card companies and banks in writing. Send your letters by certified mail, return receipt requested, so you can document what the company received and when. Keep a file of your correspondence and enclosures.
When you open new accounts, use new Personal Identification Numbers (PINs) and passwords. Avoid using easily available information like your mother's maiden name, your birth date, the last four digits of your Social Security number, your phone number, or a series of consecutive numbers.
Step 4: Communicate with debt collectors. Calls from debt collectors are a common occurrence in cases of identity theft. If you are contacted by a debt collector, tell the collector that you have been a victim of identity theft and are not responsible for the debt. Then ask for the contact information of the collector and the company, as well as for contact information for the creditor - including amount owed and account numbers. You should also supply them with a copy of your FTC fraud affidavit and/or identity theft report.
You will also need to ask the collection agency to forward copies of any documents related to your case and to notify the creditor that you are an identity theft victim (they are required to perform both of these tasks under federal law). Also ask that they confirm the receipt of your letter.
As with all other written correspondence related to your identity theft case, be sure to use certified mail.
Step 5: Continue to monitor credit reports. Even if you remove all fraudulent information from your credit reports and close unauthorized accounts, you still need to monitor your credit reports. If the identity thief is not caught, he or she could try to use your information again - months or years in the future.
In addition to the types of identity theft mentioned here, there are other types that may affect you: brokerage account fraud, Social Security number misuse, passport falsification, student loan fraud, driver's license fraud, and medical identity theft to name a few. In other cases, someone apprehended for a crime may use your identity. While these other types of identity theft are less likely than cases described here, you should still be aware that they do exist and may affect you.
Additional Resources
The resources listed here may be helpful depending on your situation. We highly recommend the FTC website for comprehensive descriptions of your rights under federal law.
Annual Credit Report Request Service
P.O. Box 105281
Atlanta, GA 30348-5281
877-322-8228
Experian
P.O. Box 2104
Allen, TX 75013-2104
Report Line: (888) 397-3742
Fraud Line: (888) 397-3742
TransUnion
P.O. Box 1000
Chester, PA 19022
Report Line: (800) 888-4213
Fraud Line: (800) 680-7289
Equifax
P.O. Box 740241
Atlanta, GA 30374
Report Line: (800) 685-1111
Fraud Line: (888) 766-0008
U.S. Federal Trade Commission
FTC Consumer Response Center
877-ID-THEFT
FTC Affidavit: Identity Theft Affidavit
U.S. Postal Service
877-876-2455
U.S. Social Security Administration
Report Line: 800-269-0271
Personal Earnings and Benefit Estimate Statement Line: 800-772-1213 (helpful to see if your SSN is being used to obtain benefits in your name)
If you cannot open a checking account because of ID theft, contact:
Chexsystems
7805 Hudson Road
Suite 100
Woodbury, MN 55125
800-428-9623
If you are unable to write checks because of bad checks written in your name, contact:
Certegy (800) 437-5120
CrossCheck (707) 586-0551
SCAN (800) 262-7771
TeleCheck (800) 710-9898
