Identity theft is the unauthorized and malicious use of another individual’s personal information, whether it be their name and address, credit card information, or Social Security number. Research has shown that identity theft occurs every two seconds and is particularly prevalent in the United States. According to the Federal Trade Commission's (FTC) Consumer Sentinel Network, there were more than 3.2 million fraud and identity theft complaints in 2019. Credit card fraud involving the creation of new accounts in another person's name comprised more than 45 percent of these complaints.
Fraudsters can steal your personal information through a variety of means, so it's important to know how to protect yourself against common identity theft techniques. However, what should you do if you find out you have been the victim of identity theft?
Alert Affected Companies
One of the first things you should do upon finding out you've been targeted by fraudsters is alert any relevant companies where fraud occurred. This includes banks, credit card companies, telecommunication companies, and others that require your personal information. Most of these institutions or companies should have fraud departments that can guide you through the necessary steps to recover from this invasion of privacy. You can also ask them to freeze accounts and change logins and passwords for added protection.
Concerning credit cards, most companies offer zero-liability policies for those affected by identity theft. There's also a federal law, the Fair Credit Billing Act, that gives consumers the right to dispute unauthorized charges. Most importantly, the act specifies that consumers can be liable for no more than $50 worth of unauthorized charges.
Create an Identity Theft Report
The FTC should also be one of your first points of contact following identity theft. By creating an Identity Theft Affidavit either online at www.ftc.gov/complaint or by phone at 1-877-438-4338, you can help the federal agency and local law enforcement track down perpetrators of identity theft. You'll need documents like your Social Security card, utility bills, and driver's license to file the Identity Theft Affidavit. Once complete, bring a copy of the affidavit along with a government-issued ID and proof of theft to a local police station so they can file a report.
Replace Missing Documents
If you've been a victim of identity theft due to a lost or stolen credit card or government-issued ID, you'll need to get in touch with the appropriate agencies to recover your identity. For instance, if you lost your driver's license, contact the Department of Motor Vehicles and explain the situation. They will be able to cancel your old license and issue a new one in addition to placing a note in your file to prevent others from acquiring an ID in your name.
Put a Fraud Alert on Your Credit Report
Beyond the immediate impact of lost funds, fraud can have substantial long-term negative effects on your credit score. Fortunately, this can easily be prevented by contacting one of the three credit reporting agencies—Transunion, Experian, and Equifax—and asking them to place a fraud alert on your account. This free protective measure lasts for 90 days and can be extended to one year, during which time businesses must contact you before issuing credit in your name. There's also an extended fraud option that lasts seven years. While in contact with one of the three credit reporting agencies, consider asking for a credit report. This will highlight any fraudulent accounts that have been created in your name.
Freeze Your Credit
Another free measure that you can take with the three credit reporting agencies is to ask for a credit freeze. This prevents these agencies from giving your credit report to prospective creditors and, unlike a fraud alert, doesn't carry a time limit. The freeze will remain in place until you choose to lift it. You should only consider this measure if you're certain you won't need an extension of credit in the near future, although there is the option of requesting a temporary lift for this reason. You will be issued a PIN for reactivation purposes after freezing your account, so be sure to keep this in a safe place.
Take Care of Yourself
Identity theft is an intrusive crime that can be traumatic for many victims. It's a violation of privacy that causes stress as well as other mental and physical distress. According to a survey conducted by the Identity Theft Resource Center (ITRC) in 2018, 77.3 percent of victims experienced emotional distress following identity theft. Moreover, 84.1 percent said their sleeping habits suffered and 56.8 percent reported persistent aches, pains, and stomach issues. The ITRC report also found that a large percentage of respondents were either ambivalent or dissatisfied with their engagement with the FTC, credit issuers, or local law enforcement.
For the benefit of your own mental and physical health, make sure to discuss the experience and your feelings with a trusted friend or mental health professional. Keeping a journal is another way in which victims can overcome this negative experience.