Every other day we hear about a financial breach at our favorite stores, get letters from our banks with new debit cards because there's been a "potential compromise of our financial information," or you look at your bank account transactions and someone's been shopping at a Nebraska Wal-Mart on your dime. Even worse, you try to apply for a loan or new credit card and get denied not because you've made previous financial decisions that resulted in bad credit, but because someone else is playing financial dress up at your expense...literally. Inconvenienced, frustrated, and angered are a few words to describe the experience of becoming a victim of identity theft. Identity theft is a crime where a thief steals your personal information, such as your name, social security number, or banking information, to commit fraud. The identity thief can use your information to fraudulently apply for credit, file taxes, or make purchases. These acts can damage your credit status, and cost you time and money to restore your good name. You may not know that you are the victim of identity theft until you experience a financial consequence (mystery bills, credit collections, denied loans) down the road from actions that the thief has taken with your stolen identity.
Report theft and recover your identity
If you are a victim of identity theft, report it immediately. The Federal Trade Commission (FTC) and your local police department are critical in filing the complaint. You will receive an ID theft affidavit from the FTC. Print and take this with you to file the crime with the local police and get a police report. These two documents together are your identity theft report. Your identity theft report will be very important as you resolve the problem with creditors, banks, and any other companies where fraudulent accounts were set up in your name. In addition to federal government agencies, you should also report the theft to other organizations, such as:
Credit Reporting Agencies - Contact the three major credit reporting agencies to place fraud alerts or freezes on your accounts so that no one can apply for credit with your name or social security number. Also get copies of your credit reports, to be sure that no one has already tried to get unauthorized credit accounts with your personal information.
Financial Institutions - Contact the fraud department at your bank, credit card issuers and any other places where you have accounts. You may need your ID theft reports from the police and Federal Trade Commission in order to report the fraud.
Retailers and Other Companies - You will also need to report the fraud to companies where the identity thief created accounts, opened credit accounts, or even applied for jobs in order to clear your name. State Consumer Protection Offices or Attorney General - Your state may offer resources to help you contact creditors, dispute errors and other helpful resources.
Prevention is key
So what can you do to protect yourself against identity theft? Here are a few tips:
Secure your SSN - Don’t carry your social security card in your wallet and only give out your social security number (SSN) when absolutely necessary.
Secure your personal info - Don’t respond to unsolicited requests for personal information (your name, birthdate, social security number, or bank account number) by phone, mail, or online. Also store personal information in a safe place.
Secure your passwords - Create complex passwords that identity thieves cannot guess easily. Change your passwords if a company that you do business with has a breach of its databases. Shield the keypad when typing your passwords on computers and at ATMs. Install firewalls and virus-detection software on your home computer.
Use Cash - To limit exposure to potential debit card breaches at retail stores, opt for using cash instead of always swiping the debit card. Debit cards are convenient, but could lead to inconvenient bank account investigations if your account is breached.
Review your receipts - Compare receipts with account statements. Watch for unauthorized transactions.
Collect mail promptly - Ask the post office to put your mail on hold when you are away from home.
Shred it - Shred receipts, credit offers, account statements, and expired cards, to prevent “dumpster divers” from getting your personal information.
Review credit reports frequently - Order your credit report once a year and review to be certain that it doesn't include accounts that you have not opened. Check it more frequently if you suspect someone has gained access to your account information.
As technology becomes more and more incorporated in our daily lives, it's important to protect yourself and your family from identity theft. Monitor your finances frequently and if it happens to you, report promptly!