Fight Back Against Credit Fraud

Identity Theft

Identity theft is the fastest growing crime in America. According to the Federal Trade Commission, the number of identity theft incidents reached 9.9 million in 2003. These crimes are estimated to have taken the average victim $500 and 30 hours to resolve. From stolen credit cards to total identity kidnapping, these ugly and prevalent crimes are hard to prevent and often difficult to correct. Although it is hard to truly avoid becoming a victim of identity theft, TrueCredit recommends a few ways you can guard against this damaging crime.

To have credit report information at your fingertips is the best way to shut an identity thief down--you can begin the process of notifying your creditors of the fraud, changing your passwords, and closing down fraudulent accounts before they wind up in the hands of collectors and compromise your good credit.

Types of identity theft

Identity theft crimes range from purse snatchings to kingpin-style fraud rings. The definition of identity theft is a crime in which an imposter obtains key pieces of personal information, such as a Social Security number, in order to impersonate someone else. Identity theft can occur when someone takes your mail, steals your wallet or swipes your records from an institution. Most cases can be resolved fairly easily if they are caught early. Creditors and banks usually hold you responsible for only the first $50 of fraudulent charges. The most serious cases of fraud can take several years and many resources to resolve.

Preventative measures

In this world of smiling strangers, it can be tough to keep your identity safe. The best security policy is to be aware of fraud and cautious about where you share personal information. Check your account statements carefully each month and keep an eye out for suspicious activity on your credit report. A paper shredder can also be a powerful tool for making sure personal information and pre-approved credit offers don't end up in the wrong hands.

If your identity is stolen

If you suspect that your identity has been stolen, the first step is to get all the facts about the damage. Become your own detective search your credit report and bank accounts for clues. Ask your creditors to immediately cancel any fraudulent charges and consider putting a security alert on your credit report. If the theft is serious, file a police report. If fraudulent records start to show up on your credit report , send letters of dispute to the reporting agencies with copies of documentation supporting your claim. Signing up with a credit monitoring service will inform you of changes to your credit. It may take a while to fully recover the security of your accounts, but it’s crucial that you don't let the fraud escalate.

How identity theft occurs

Identity theft is one of the nation’s fastest-growing crimes, affecting more than 9 million people each year. The more you know about this prevalent crime, the better prepared you will be to protect yourself. Identity thieves can get hold of your personal information in a variety of sneaky and illegal ways:

Your mail

•They go through your mail and take your bank and credit card statements, pre-approved credit offers, and tax information
•They complete a "change of address form" and reroute your mail to another location

Stealing your information

•They steal your wallet or purse containing your personal identification and credit cards
•They “dumpster dive,” rummaging through trash bins for your personal information such as unshredded credit card and loan applications
•They "shoulder surf" at ATM machines and phone booths in order to capture PIN numbers

Buying your information from a third party

•They buy your personal information from "inside" sources. For instance, an identity thief may pay a store employee for a copy of your credit application

While pretending to be you, thieves:

•Call your credit card company and ask to change the mailing address on your credit card account. Then, they run up the charges on your credit card. Because your bills are being sent to the new address, it may take some time before you realize what’s going on
•Use your name, date of birth and SSN, to open a new credit card account. They use the credit card and don't pay the bills. Or, sometimes they make the minimum payment every month so that the activity can go on, unnoticed, for months
•Establish phone or wireless service in your name
•Open a checking account in your name and write bad checks•File for bankruptcy under your name to avoid paying the debts they’ve incurred as you

Minimize your risk

By managing your personal information carefully and sensibly, you can help guard against identity theft. TrueCredit recommends a few simple precautions to keep your personal information safe:

•Do not carry extra credit cards, your Social Security card, birth certificate or passport with you unless needed.

•When you order new checks, do not have them sent to your home. Pick them up at the bank instead. If stolen, your checks can be altered and cashed by identity thieves.

•Never give out personal information over the phone. Identity thieves may call, posing as banks or government agencies.

•Shred your receipts, credit card offers, bank statements, returned checks, and sensitive information before throwing it away

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•Protect your Social Security number with extra care. Disclose it only when it is absolutely necessary. Don’t have your Social Security number printed on your checks.

•Follow your billing cycles closely. A missing credit card bill could mean an identity thief has changed your billing address to his own.

•File away a list of all your account numbers--with expiration dates and telephone numbers. If your wallet is stolen, you will be able to quickly alert your creditors.

•When creating passwords & PINs, use a random mix of letters and numbers. Do not use information that may be easily discovered by identity thieves.

Emergency contacts
When you find signs of identity theft on your credit report , it is important to notify the proper authorities. These are some of the people you need contact first. Your Financial Institutions - Your first step should be to contact the bank, creditor or lender associated with the account that has been used fraudulently. Work with these institutions to lock the account and investigate the damages. The Credit Reporting Agencies - You only need to call one credit reporting bureau if you would like to place a fraud alert on your account. As soon as the credit bureau confirms your fraud alert, the other two credit bureau will be notified to also place fraud alerts on your account.
- •Equifax To report fraud, call: 800-525-6285 or write: P.O. Box 740241, Atlanta, GA 30374-0241
- •Experian To report fraud, call: 888-EXPERIAN (397-3742) or write: P.O. Box 9530, Allen TX 75013
- •TransUnion To report fraud, call: 800-680-7289 or write: Fraud Victim Assistance Division, P.O. Box 6790, Fullerton, CA 92634
- •The Federal Trade Commission - Visit the FTC online at http://www.consumer.gov/idtheft/ to file a fraud complaint and complete an identity theft affidavit. You can also call the FTC’s Identity Theft Hotline toll-free at 1-877-IDTHEFT (438-4338).
- •The Police - If your identity theft case is serious, you may want to file a police report to document the identity theft. You may need a copy of the report to submit to the credit reporting agencies or financial institutions as proof of the crime.
Pack your bags and prepare your finances
Whether you're planning your trip to Las Vegas or Venice, including a few financial arrangements in your preparations will help keep your credit reports safe and your mind free of worries while you are away:
- • Guard against mix-ups - Call your credit card issuers to notify them before you leave on a vacation, especially if you are traveling outside the U.S. If your banks and card issuers know that you are traveling, they are less likely to put a fraud alert on your account or mistakenly block your access to the account when charges from unusual locations appear.
- •Make photocopies of important documents - Having copies of your credit cards, driver's licenses and passports will make the replacement process much faster if you lose something important while traveling. Add a list of emergency contacts to this folder including the phone numbers of your doctor, banks and family members. Leave a set of these documents at home with a friend and store one in a separate piece of luggage.
- •Avoid late payments - Plan ahead so you won't miss any bill payments while you are away. Online bill payment systems now make it easy to schedule a payment in advance, look for a Web address at the bottom of your monthly statements. A little preparation will help you avoid expensive late charges and unnecessary damage to your credit report.
- •Set a limit on your credit usage - It can be tempting to go hog wild while on vacation, but always remember to make a budget before you go. If you are going to a country where it will be hard to access ATM machines, take travelers checks with you in case you can't get to your cash. Keeping a record of your expenses and cash withdrawals can help you keep your spending under control while on vacation. A glut of debt is not a fun souvenir to bring home from your vacation.
- •Keep an eye on your identity - While you're booking hotels online, using your credit card in unknown places and letting the mail pile up at home, identity thieves have more opportunities to get a peek at your private information. Guard against fraud by asking the Post Office to put a vacation hold on your mail and by being careful where you use your credit card. Check the activity on your financial statements and your credit reports from TransUnion, Equifax and Experian closely when you return to make sure your accounts haven't been harmed.
More Fraud...
There is a widely distributed email which has been warning people that the credit bureaus are going to change their information privacy policies on July 1. This is not true. The credit bureaus are not changing their privacy policies.
Credit reporting agencies already have the right to share your credit report information with legitimate businesses such as potential lenders, creditors and other requestors covered by the Fair Credit Reporting Act.
The whole credit reporting industry revolves around the agencies’ ability to share this information with businesses that have a valid need for the data under the FCRA. This incorrect email is probably the result of a misunderstanding concerning the Financial Services Modernization Act that was enacted July 1, 2001. This act required financial institutions to explain their information sharing policies and to give customers the option to opt-out of marketing offers. If you want to opt-out of this type of pre-approved credit offer and other 3rd party mailings, simply ask your financial institutions to remove your name from their marketing lists.

Can Consumers Fight Back Against Credit Fraud?