Anyone noticing strange activity on their account statements, such as credit card charges or cash withdrawals they know they didn’t make, or if they’re getting bills for services they never used, may be a victim of identity theft. Consumers can take several steps to report suspicions that their identity has been stolen.
And the sooner they report the problem, the faster they may be able to fix it.
There’s no sugarcoating it: Depending on the type and extent of the fraud, an identity theft victim could be in for a few challenging days (or months or even years). The nature and severity of identity theft will differ from person to person. But there are steps consumers can take to help minimize current and future damage to their finances and reputation.
What Is Identity Theft?
Identity theft occurs when someone wrongfully accesses another person’s personal data and uses it to assume their identity—usually for financial gain.
A thief might steal from the victim’s existing bank accounts, make purchases using their credit cards, open new accounts using the victim’s information, or even file for a tax refund with the victim’s Social Security number.
According to data gathered by the Federal Trade Commission’s Consumer Sentinel Network , more than 650,000 cases of identity theft were reported in 2019. Credit card fraud topped the list of identity theft reports to the FTC that year.
How to Spot Identity Theft
It isn’t always possible to pinpoint how, when, or where a thief got access to personal information, and some crimes may take longer to spot than others.
It might take years to notice that a child’s identity has been compromised, for example, or to realize that someone has stolen personal information to file false medical claims. But both can damage a victim’s credit standing and cause other problems if incorrect information gets into school or medical records.
However, there are signs of identity theft that consumers can watch for as they manage their day-to-day finances.
You might notice pretty quickly if there are unusual charges on your credit card, or your bank balance is lower than you thought. Other red flags might include:
• Debt collectors are calling about unpaid bills that aren’t yours.
• There are new and unfamiliar accounts on your credit report.
• Your credit or debit card is declined when you try to use it to make a purchase or cash withdrawal, or your checks bounce.
• You don’t receive bills you normally get, or you get bills for purchases that aren’t yours.
• The IRS informs you that a tax return has already been filed in your name.
• Your health insurance statement shows charges that aren’t yours.
• Your loan application is turned down because of negative information on your credit report.
And, of course, if you’ve been notified that there’s been a data breach at a business that has your personal information, you also may want to take steps to monitor and limit your exposure.
How to Report Identity Theft
Because identity theft is so common, the government and many individual businesses have established efficient, consumer-friendly processes for reporting problems. Here are some steps consumers can take if they suspect their identity has been stolen.
Contact a Protection Plan If You Have One
If you’re paying for identity theft insurance (through LifeLock, Experian, Allstate, or some other provider), you can contact that company for guidance. (You may even have received the first notification of potential trouble through your plan.)
An agent should be ready to assist you through the reporting and remediation process. If you aren’t sure you have a plan, you might check with your human resources department to see if you have coverage through your employer.
Call Any Company Where Fraud May Have Occurred
Call your credit card issuer, financial institution, and any other company that might be involved in the theft and share your concerns about suspicious behavior.
You might be able to head off a whole lot of trouble by acting as soon as you notice something unusual: The federal laws that cover credit and debit card theft offer more protections if you act quickly.
The person you speak with is likely to offer tips for what to do next, so taking notes is a good idea. And you should be ready to change any passwords or PINs attached to your account.
If you suspect that someone has stolen your identity for tax fraud, contact the IRS. And if something seems sketchy about your health care statements, call your insurance provider. (If you aren’t sure who to call for a specific issue, the Federal Trade Commission offers checklists to help consumers report just about any type of identity theft.)
Add a Fraud Alert and Maybe a Freeze
Next, you can broaden your protection by placing a free, one-year fraud alert on your credit reports. A fraud alert requires creditors to verify your identity before processing credit applications.
It isn’t necessary to contact all three major credit bureaus to get an alert; you only have to ask one bureau (your choice) to place the alert, and that company must tell the other two. You should receive a letter from each bureau confirming the alert.
• experian.com/fraud/center.html or 888-397-3742
• transunion.com/fraud-alerts or 888-909-8872
• equifax.com/personal/credit-report-services/ or 800-685-111
You don’t have to wait for suspicious activity to place a fraud alert. If you lost your wallet or a credit card, or if your personal information was exposed in a data breach, a fraud alert can make it more difficult for someone to open new accounts in your name. A fraud alert also allows you to access one free copy of your credit report from each the credit bureaus.
The alert does not negatively affect your credit report, credit scores, or ability to get a loan or credit card. However, it may make it more difficult to get instant approval if you’re applying for a credit card at a store register or if you’re applying for a card online.
You can further lock down your credit by asking each credit bureau for a free credit freeze. When you have a fraud alert, businesses must verify your identity before issuing credit, but with a freeze, access to your reports will be completely blocked.
No one will have access except your existing creditors (or debt collectors acting on their behalf) and government agencies that are responding to a subpoena, search warrant, or a court or administrative order.
If you want to apply for credit or give a potential landlord or lender access to your credit reports, you’ll have to ask the credit bureaus to temporarily lift the freeze. You may be issued a PIN or password for this purpose.
File an Identity Theft Report With the FTC
If you find you’re the victim of identity theft and you haven’t already checked in with the FTC’s identity theft website to take advantage of its tips and checklists, you can log on to create an identity theft report and generate a recovery plan.
When you create an account, the site can guide you through each step, track your progress, and even help you fill out forms and letters.
If someone is, indeed, using your personal information to impersonate you, you can use the report to show businesses that your identity was stolen, and the report guarantees certain rights.
Possibly File a Report With Law Enforcement
As part of the paper trail you build to prove you were a victim, the FTC says you may choose to report the identity theft to your local police department.
If the theft was local, the report may help the police track down the culprits. And even if the personal data was stolen online, you’ll have more documentation to back up your claim.
Go prepared with a copy of your FTC identity theft report, a government-issued photo ID, proof of address, and backup paperwork that can serve as proof of the theft (an IRS notice, credit card or bank statements, etc.). And you may want to print out and bring along a copy of the FTC’s Memo to Law Enforcement , which explains how the FTC’s report and the law enforcement report can work together to help a victim.
Ask for a copy of the police report when it’s completed. (You may need it later.)
Start Fixing the Damage
With your FTC identity theft report in hand and a police report for backup, you can call the fraud departments at any business where there’s a problem and:
• Ask them to close any fraudulent account that isn’t yours and confirm it with a letter.
• Ask them to remove any fraudulent charges to your account and confirm that with a letter as well.
Then you can write to each of the credit bureaus and ask them to block the information on your reports that came from the identity theft.
Sign Up for Credit Monitoring
If you want a little help keeping an eye out for suspicious activity on your accounts, a credit score monitoring company can watch your credit reports and send alerts if there’s something unusual or if a new account is opened.
This service may be offered for free (for a limited time) if your information was exposed during a data breach. And there are several companies that offer credit monitoring if you want to pay for it yourself.
You also might want to check to see if some type of credit monitoring is offered by your financial institution. For example, with SoFi Relay, members can track their credit score at no cost with weekly updates.
Tighten Up on Money Management
Even if you have a service to monitor your accounts for problems, you can also help yourself by keeping watch over your finances. A few ways to do that might include:
• Review your credit reports for items you don’t recognize. Generally, you can request a free credit report from each of the three credit bureaus once a year (by law) at annualcreditreport.com . (There are other sites that offer free reports, but that is the official site.)
• Check credit card statements, bank statements, and medical statements regularly. You can check old statements for past suspicious activity. (Don’t forget older accounts that you don’t use but keep open.) And, going forward, it could help to review online statements frequently to make sure nothing new is popping up.
• Consider consolidating your credit card debt. If you have a few credit cards and you don’t want to monitor them constantly, or you’d like just one manageable payment, you might want to look at paying off those cards with a consolidation loan. With a SoFi® credit card consolidation loan, for example, you may be able to combine all those bills into one new loan with a lower interest rate.
Is There Any Way to Prevent Identity Theft?
While identity theft can happen to anyone, there are some things you can do that might reduce your risk. Besides taking the steps above, you could:
Toughen Up Your Password Game
Try to find passwords that have some meaning to you but would be difficult to hack. (Don’t use the word “password” as your password!) Change passwords occasionally. And you might want to avoid keeping a file with all your passwords on your computer’s desktop.
Use Secure WiFi and Secure Websites
Try to avoid using public WiFi when checking financial accounts, paying bills, and so on. And if you can, even when you’re at home, stick to websites that are secured (look for the padlock and URLs that start with https). Keep your devices updated with the latest software.
Set Up Alerts
Take advantage of free fraud protections and alerts your credit card company might offer.
Shred Old Documents and New Credit Card Offers
Get rid of anything thieves might be able to use to get your personal information or set up an account in your name, including statements, receipts, and old credit and debit cards. (Need an incentive? Picture your documents sitting in a dumpster or landfill, where anyone could see them.)
Protect Your Social Security Number
Don’t carry your Social Security card in your wallet. And don’t give out your number (even if a form asks for it) unless it’s absolutely necessary.
Pay Attention to Current Scams
Watch the news for the latest scams and data breaches to head off trouble before it happens.
Cybercriminals are good at what they do. And they’re always working to come up with new schemes to get to your money.
But you might be able to make it harder for them by staying vigilant and acting swiftly if your personal information has been compromised.
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