03
May

shutterstock_48106810

In 2015, the FTC (Federal Trade Commission) received over 490,000 consumer complaints about identity theft, a 47% increase over the prior year and the Department of Justice estimates that 17.6 Americans were victims of identity theft in 2014.

Signs that you’ve been a victim of Identity Theft

Keeping vigilance about identity theft need not be a full time job. Besides the obvious one like many charges on your credit card that you did not makes, there are a few things to keep in the back of your mind should you experience them:

  • You receive calls from a collections firm. Many people don’t know they’ve been a victim until they receive calls from a debt collector regarding a mysterious bill. While debt collectors are known to make mistakes, you should immediately suspect identity theft if you don’t recognize the original creditor named in the call.
  • You notice inquiries on your credit report from banks to which you’ve never applied for credit.   If someone has stolen your identity, the first thing they want to do is test the waters by applying for new credit in your name. They may try a few banks to seek easy credit with the minimum of information required.
  • You see withdrawals from your bank account that you can’t explain. If this occurs, notify your bank immediately and close the account. There is no liability protect from the law if someone has used your ATM card fraudulently, though if they’ve used your debit card as a credit card, your liability is $50 if you notify them in two days, $500 afterwards.
  • You don’t get your bills or other mail. If an identity thief is opening new accounts, they have most likely used a different address from you so they can intercept new cards for which they’ve applied. In some cases, they may have submitted a change of address form to the post office.

How Identity Theft Can Affect Your Credit

Beside the potential for identity theft costing you money out of pocket, identity theft can hurt your credit in a variety of ways:

Higher Balances on Existing Accounts. One of the most common forms of identity theft is the misuse of existing accounts — fraudulent charges made to credit cards: for instance, the credit card number is lifted and the number used to make online purchases. Since credit card utilization is 30% of your score, dramatic increases in your balances can drop your credit score significantly.

New Accounts. If a thief opens a new account in your name, you will have an inquiry on your credit report, which can cost you up to 5 points a piece. The amount of new credit you have counts for 10% of your credit score — having many new accounts can drop your rating.

Late Payments. If a thief opens an account in your name fraudulently, most likely they aren’t going to make payment on the account. One late pay can drop your credit score by as much as 100 points.

What To Do if you’ve been a Victim of Identity Theft

The FTC estimates that it takes an average of six months and 200 hours of work to recover from identity theft.

Report the theft to your bank.

Let your bank know immediately that you’ve become a victim so they can put a freeze on your old accounts, close them and open new ones.

Pull your credit report.

If you haven’t discovered the theft from pulling your credit report, pull it now. You can get a copy of your credit report for free from each of the three credit bureaus once per year from annualcreditreport.com. 

Report the theft to the police.

In order to take advantage of the protections offered to you by law, you need to report the incidence of theft to the police. However, in 2014, fewer than one in 10 identity theft victims report the incident to police. Most police departments have an online form you can fill out to report the theft and receive a report. Once you have the report, you can forward a copy to your bank or the credit bureaus to aid in cleaning up the mess.

Report the theft to the FTC.

While the FTC can’t investigate your case individually, reports from the public can help the FTC shut down identity theft rings and helps companies become aware of flaws in their protection of consumer information. In addition, the FTC offers personalized ID theft recovery plans at identitytheft.gov. The site offers tools to create documents necessary to alert police, the main credit bureaus and the IRS, among others.

How to Protect Yourself from Identity Theft

In 2014, 85% of people took steps to protect themselves from identity theft. These steps included checking credit reports, shredding documents with personal information and changing passwords on financial accounts. With very minimal effort here are some steps you can take to protect yourself from identity theft:

Check your credit reports. One of the easiest things you can do to guard against identity theft is to check your credit report. Checking your credit report can reveal indications that someone might be using your identity in a nefarious manner. Mysterious inquiries, accounts and activity not initiated by you are all warning signs. 

Shred documents with personal information. Destroying sensitive paperwork is a way to prevent “dumpster diving” where criminals actually go through the trash to obtain valuable personal information like social security numbers or credit account numbers. Despite the fact that we live in a digital age, there is enough printed material in your home to sink you if it got into the wrong hands. Shredders are cheap and easy to use.

Change passwords on financial accounts every so often. Passwords are easy to hack and changing them can be the difference between an identity thief moving on to an easier target or deciding to get into your personal information online.

Read your bank statements carefully. One of the easiest ways to spot identity theft is to read your credit card and debit card statements carefully. If you see charges on your statements that you did not make, contact your bank immediately and have them open a new card number for you and close the old one. You are not responsible for fraudulent charges, and this is the quickest way to stop fraud from reoccurring. If you notice more than one account with fraudulent charges, this could be an indication of a larger problem and requires your immediate attention.

Avoid giving away too much information on social media. If you are active on social media, you should be careful about what you put out on the Internet. ID thieves need your social security number and just a few other pieces of identifying information. Don’t post things like phone numbers, addresses, kid’s names, and any information about where you bank.

Related Articles: 

Victim of “Friends & Family” Identity Theft?

Can Credit Report Security Freezes Protect You From Identity Theft?

Identity Theft and Social Media: Five Things to Avoid

 


Posted in Identity Theft