Monday, September 23, 2019

Identity Theft: Protecting Your Good Name

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In 1998, a federal law was passed making it illegal for someone to use another person’s identifying information without his or her permission. Labeled as “identity theft,” this financial crime occurs when someone uses your personal information, such as your driver’s license number, credit card, social security, bank account, or other account numbers, to falsely obtain goods or services, or to commit other crimes.

Once identity thieves have your name and personal information, they might use them to write counterfeit checks or use your debit card to drain your account. Identity thieves may open new accounts in your name and write bad checks on the account. They may file for bankruptcy under your name to avoid paying their debts. Some identity thieves take out a car loan or purchase expensive items with your credit card. They may complete a “change of address” form to redirect your mail to another location. Because the bills are sent to the new address and aren’t being paid, the delinquent account is reported on your credit report before you discover there is a problem. Some victims of identity theft have been refused loans for housing, cars, or education because of their credit report. People whose identities have been stolen can spend several months or years straightening out the problems caused by identity theft.

How Thieves Steal Your Identity

There are several ways that identity thieves steal your personal information. “Dumpster diving” refers to the practice of rummaging through your trash, or the trash of a business, to obtain personal data. Identity thieves may pose as an employer, landlord, or someone else who has a legal right to the information. They obtain your credit report by abusing their employer’s authorized access to your credit report. Identity thieves steal purses and wallets that contain personal information. Mail is stolen, including pre-approved credit card offers, new checks, or bank and credit card statements. Computer hackers get information from organizations and businesses. Identity thieves scam information by posing as a legitimate government or business official. These thieves might not use your personal information for themselves, but might sell it to someone else to use fraudulently.

Warning Signs of Theft

Although consumers aren’t always aware of their identity being stolen, there are warning signs that may indicate you are a victim of identity theft. If you receive credit cards for which you did not apply, or if you have been denied credit for no apparent reason, you may be a victim of identity theft. You may receive calls from debt collectors or companies about services or merchandise that you did not purchase. If you don’t receive bills or other mail, it may be a sign that your mailing address has been changed, indicating identity theft.

You can find out if an identity thief is opening new accounts in your name by ordering a copy of your credit report from any of the three major credit bureaus. Check the report for accuracy. If you find any errors, order your report from the other two credit bureaus. Some inaccuracies on your report may be a computer or clerical error and may not be a result of identity theft.

How to Avoid Identity Theft

Take the following steps to minimize your risk of becoming a victim of identity theft.

  • Before releasing any personal information, find out why it is needed and how it will be used.
  • Do not give out your Social Security number to people or businesses that you do not know.
  • Protect your mail—incoming and outgoing. Don’t leave your incoming mail in the mailbox for any length of time. Remove it as quickly as possible. Place outgoing mail in post office collection boxes.
  • Purchase a cross-cut shredder to dispose of any personal information that you no longer need, such as checking, savings, or credit account statements. Shred any pre-approved credit offers before you discard them.
  • Don’t regularly carry several credit cards, your Social Security card, birth certificate, passport, or any other document that contains your personal identification information.
  • Avoid using passwords and personal identification numbers (PINS) that can be easily revealed, such as date of birth, phone number, or the last four digits of your Social Security number.
  • Pay attention to your credit account billing cycles. If you don’t receive your bills, contact the creditor. A missing bill could indicate your account has been taken over and your address has been changed.
  • Don’t give personal information over the phone or Internet unless you initiated the call or know with whom you are dealing.
  • Keep personal information, such as charge receipts, insurance forms, bank checks, and credit card statements in a safe place.

What to Do if You Become a Victim of Identity Theft

If you discover that you are a victim of identity theft, these are the things you should do:

  • Contact the fraud departments of the three major credit bureaus and get a copy of your credit report from each bureau. Credit bureaus must give you a free report if it is inaccurate because of fraud. Request that a “fraud alert” be placed in your file. Include a statement that creditors must get your permission before any new accounts can be opened in your name. The three major credit bureaus are:
    Equifax—800-525-6285 (to report fraud), 800-685-1111 (to order credit report)
    Experian—888-397-3742 (to report fraud or order a credit report)
    Trans Union—800-680-7289 (to report fraud), 800-888-4213 (to order credit report).
  • Check your credit report every six months and look for any inaccurate information.
  • Contact all of the creditors where you have accounts. Notify them that your account was used without your permission, or that new accounts have been opened in your name that you didn’t authorize. Close the accounts and ask for new account numbers and cards.
  • Notify financial institutions that you are a victim of fraud.
  • Contact the Federal Trade Commission (FTC) and file a report by calling the FTC’s Identity Theft Hotline: 1-877-IDTHEFT (438-4338); by mail, Identity Theft Clearinghouse, Federal Trade Commission, 600 Pennsylvania Avenue, N.W., Washington, DC 20580; or online at www.consumer.gov/idtheft.
  • In addition, file a police report. Get a copy of the report to provide to your creditors and others who may require proof of the crime. Keep a file with copies of the credit reports, police report, correspondence, and copies of disputed bills.
  • Report fraud involving your Social Security number to the U.S. Social Security Administration (1-800-269-0271).

Sources

  • “ID Theft: What It’s All About,” Bureau of Consumer Protection, Federal Trade Commission.
  • “Identity Theft: Reduce Your Risk,” American Express Company, Consumer Affairs Office, Washington, DC.
  • “Protect Yourself From Identity Theft: It’s Your Good Name,” Bank of America Consumer Education Fund, Consumer Action, San Francisco, CA.
  • “When Bad Things Happen to Your Good Name,” Federal Trade Commission, Washington, DC.

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