Identity Theft: When Your Personal Financial Information Is Stolen

Identity theft affects nearly five percent of the adult population. It begins with the plunder of personal information and ends with the use of that information to commit fraud. For starters, assume that personal information has been lost, stolen or otherwise compromised. Here are some simple actions you can take to shorten the lifespan of fraud crooks.

Contact the major credit reporting agencies to see if they have records of new accounts in your name that you did not initiate. Ask them to place an “initial fraud alert” on your file (as opposed to an “extended alert,” below), which stays on your credit report for 90 days. The alert raises a red flag on new credit activity. You only need to contact one of the three national credit bureaus to place an alert, and they must contact the other two.

Equifax: 1-800-525-6285, www.equifax.com

Experian: 1-888-397-3742, www.experian.com

TransUnion: 1-800-680-7289, www.transunion.com

Order free copies of your credit report from each of the agencies, but wait a few weeks to do so. Suspicious activity will not immediately make its way onto your report. When the reports arrive, scour them for debts you can’t corroborate, inquiries from companies you didn’t contact, accounts you didn’t open – evidence that your lost information is being used to defraud in your name.

If the stolen information includes your financial accounts, close affected credit card accounts immediately. Close bank and brokerage accounts or change the passwords and have the accounts monitored. Your financial institution can help you decide which is best.

If the stolen information includes your driver’s license or other government-issued identification, cancel and replace those documents. Ask the agency to “flag” your file to keep anyone else from getting new documentation in your name.

Assume that fraud has occurred; somebody is using your name to run up debt, get loans, or commit other crimes. It is time to pick up the pieces. Here are the steps you take to clear your name:

Call the Federal Trade Commission’s Identity Theft Hotline (1-877-IDTHEFT). The FTC provides information and assistance to victims of identity theft, and refers them to law enforcement, credit reporting agencies, and others. Or you can use the agency’s complaint form.

Have the major credit reporting outfits (Equifax, et. al.) attach an “extended fraud alert” on your credit report. This alert lasts for seven years. You are encouraged to keep close tabs on your credit with two free reports from each of the agencies within the next year.

In certain circumstances, you may need to contact additional agencies:

• If the crime involved the U.S. Mail, report it to your nearest U.S. Postal Inspection Service office;
• If you suspect the improper use of identification information in connection with tax violations, contact the Internal Revenue Service;
• If the crime involved counterfeit credit cards or computer hacking, report it to the U.S. Secret Service;
• If your Social Security number is being used fraudulently, inform the Social Security Administration. Getting a new Social Security number is a radical, rare, but real option.

Case Studies: Identity Theft and Fraud

Case Study 1: Linda’s Stolen Social Security Number

Linda, a diligent employee, discovers that her Social Security number has been stolen. She realizes the potential for identity theft and takes immediate action. Linda contacts the three major credit reporting agencies – Equifax, Experian, and TransUnion – to place an “initial fraud alert” on her credit file.

She orders free copies of her credit reports from all three agencies and carefully examines them for any suspicious activities, such as unrecognized accounts or inquiries.

Linda files a complaint with the Federal Trade Commission (FTC) and contacts her local law enforcement agency to report the theft of her Social Security number.

She also informs her financial institutions, such as banks and credit card companies, about the situation. They help her monitor her accounts for any unauthorized transactions and assist in closing or securing affected accounts.

Case Study 2: Mark’s Compromised Email Account

Mark, a tech-savvy professional, discovers that his email account has been compromised. Worried about potential identity theft, he takes prompt action. Mark immediately changes the password for his compromised email account to prevent further unauthorized access.

He enables two-factor authentication on his email account and other online accounts to add an extra layer of security. Mark reviews his email account’s sent folder and discovers that the hacker has sent phishing emails to his contacts.

He warns his contacts about the security breach and advises them to exercise caution. Realizing that the hacker may have gained access to other online accounts, Mark updates the passwords for all his accounts, using strong and unique passwords for each.

Case Study 3: Jennifer’s Stolen Wallet

Jennifer’s wallet is stolen, putting her personal information and financial security at risk. She takes swift action to protect herself. Jennifer contacts her bank and credit card companies to report the theft and request immediate card cancellation.

She verifies recent transactions for any unauthorized charges. She notifies the local authorities and files a police report, providing details of the stolen wallet and any potential identification theft concerns. Jennifer monitors her credit reports regularly to check for any new accounts or suspicious activities.

She places a fraud alert on her credit file to enhance security. Concerned about potential misuse of her identification documents, Jennifer contacts the relevant government agencies to report the theft and request replacements. She follows their instructions for safeguarding her identity.