If you are serious about maintaining your good credit standing, identity theft is certainly one of your worst nightmares. You are undoubtedly guarding your Social Security number, date-of-birth, PINs and other personal data. You are certainly on the alert for phishing schemes, and you are likely shredding any documents that could lend a helping hand to criminal types.
You probably review your credit report, at least annually, and you wipe your drives before discarding old personal computers and other digital devices that may contain your personal information. You thoroughly review your bank and credit card statements upon receipt. You also limit your online shopping to well known retailers, and you may even drop your mail at the post office rather than risking its theft from your mailbox. All very sound prevention measures to be sure. However, even with these preventative measures in place, you could be the next victim of identity theft. The most recent survey by Javelin Strategy & Research suggests that 1 in 20 adults fall prey to identity theft.
Red Flags of Identity Theft
When identity theft occurs, you need to be aware of the warning signs. Early detection is key to mitigating the damage. These are examples of some red flags that alert you to possible identity theft.
- Inexplicable debits from your checking, savings or other bank accounts
- Monthly statements or other mail that suddenly stops
- Businesses suddenly refuse your personal checks
- You receive calls from debt collectors for bills you do not owe
- You detect unfamiliar accounts when you review your credit report
- You receive bills for medical services you did not use
- Your bona fide medical claim is denied by your insurance company because you have reached your benefits cap
- You receive a notice from the Internal Revenue Service advising you that you have income from an undeclared employer or that you have filed more than one tax return in a given year
- You have business with a company that puts you on notice that they suffered a data breach
- You find that you have an arrest warrant outstanding for a crime supposedly committed in your name
There are three steps you must take immediately if you suspect that your identity has been compromised. First, contact any one of the three credit-reporting agencies, TransUnion, Equifax or Experian, and advise them that you think you are a victim of identity theft. Here are the contact numbers: Experian (888) 397-3742, TransUnion (800) 680-7289, and Equifax (800) 525-6285. Request that they place a fraud alert on your file due to identity theft, and confirm that the credit-reporting agency will forward the fraud alert request to the other two reporting agencies. This alert is valid for ninety days and renewable for another ninety days by placing a call at its expiration. Begin careful and detailed record keeping of all activities relating to resolving the identity theft.
Next, as an identity theft victim, you are entitled to a free copy of your credit report from all three credit-reporting agencies. Order them from: https://www.annualcreditreport.com/cra/index.jsp
Review them thoroughly for fraudulent activity. Contact the fraud department of each business or company you identify and follow up in writing via certified mail with a return receipt. Retain copies of all your correspondence.
Finally, you must file an identity theft report, which enhances your credibility with creditors, debt collectors, companies that opened fraudulent accounts in your name and the credit reporting agencies. An identity theft report involves three steps and is actually a combination of two documents. The first document is acquired by filing a complaint with the Federal Trade Commission (FTC). This can be accomplished online and after entering all the required information you can print out your Identity Theft Affidavit. Armed with your Identity Theft Affidavit, you must then file a police report. You should retain a copy of the police report, which in combination with the Identity Theft Affidavit constitutes your Identity Theft Report.
The Road to Recovery
This is just the beginning of your journey to clean up credit. You will have to spend considerable time and energy as you rebuild credit and dispute errors and fraudulent charges. You will likely spend hours resolving fraudulent accounts opened in your name and frustrating days working with the credit-reporting agencies to remove the incorrect information, which resulted from the identity theft, and pursuing copies of the documents the identity thief used to work his mischief. Ultimately, all this hard work will pay-off and your credit history will be restored. It isn’t a cakewalk, but it is doable.
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Dominique Brown is a financial planner, owner of the blog YourFinancesSimplified and author of the book How To Fix Your Credit
Photo courtesy hellogreenstar