Identity theft is at an all-time high, and the numbers continue to rise. In 2017 alone, a whopping 16.7 million Americans were victims of identity fraud, according to the Insurance Information Institute.
And it’s no secret that falling victim to identity theft can take a major toll on your financial and mental health. But by being proactive and watching out for the warning signs, you could ward off fraudsters. And if your identity is compromised, you want to act quickly so you can recover and move on with your life.
Easier said than done, particularly if you have no idea how to handle identity theft or how to shield your information from those who are on the prowl in the first place. Read on to learn how to protect yourself from identity theft, along with key warning signs and what to do if your identity is stolen.
How to Protect Yourself
There are no guarantees that your identity won’t be compromised. However, there are some actions you can take to greatly minimize the chances, including:
- Changing your passwords frequently
- Shredding confidential documents
- Refraining from storing passwords or other confidential information on your computer or smartphone (and you probably shouldn’t text this information, either)
- Logging off of public computers
- Not using public Wi-Fi to make purchases or transactions
- Only using secured websites when shopping online
Red Flags to Lookout For
You also want to be mindful of red flags that could warn you that your personal and financial information has been compromised. A few things to be on the lookout for:
- Your bank and credit card statements contain unauthorized transactions.
- You receive a text alert stating a transaction was declined that you didn’t initiate.
- Bills no longer make it to your mailbox or you receive statements for services or accounts you didn’t sign up or apply for.
- You receive alerts for new accounts, unusual account activity, or suspicious changes to your credit reports.
- You’re denied for credit accounts you should qualify for.
- Your credit score tanks out of the blue without you making any major changes.
- You log in to your online portal and your contact information isn’t correct.
- You receive a tax transcript from the IRS because someone attempted to request information from them and failed the online security test (which prompted the sending of the paper document).
- Your tax return is not accepted by the IRS eFile system.
How to Recover From Identity Theft
In the event your identity is stolen, the Federal Trade Commission (FTC) recommends that you take the following actions:
Step 1: Reach Out to the Companies Where the Fraud Occurred
The moment you discover your identity has been stolen, you need to pinpoint the contact information for the company and reach out to their fraud department right away. You can do so by visiting AnnualCreditReport.com and retrieving a free copy of your report from each of the credit bureaus. A phone number for each account will be listed on the credit report as a starting point.
And while you’re searching for contact information, it’s also a good idea to highlight or circle any other accounts you don’t recognize and add them to the list. That way, you can kill two birds with one stone.
Disclose your findings to the customer service representative and inquire about the next steps. You will more than likely be prompted to answer additional questions regarding your complaint and submit supporting documentation, like an Identity Theft Report from the FTC or a Police Report. More on that shortly.
But before you end the initial call, confirm that they have closed or frozen the accounts to prevent additional fraudulent transactions from being processed. You should only request that an account be frozen if it belongs to you and you want to use it in the future once the discrepancies are resolved.
Also, request that a letter be sent by snail mail to confirm that the charges will be removed. And you also want to note the name of the representative you spoke with, along with the date and time for future reference.
Repeat this process for each known incident. (Quick Note: Later in the article, you’ll be prompted to review your entire credit report along with all your statements to determine if there are other issues).
Step 2: Change All Your Passwords
While you’re addressing accounts with fraudulent activity, it’s also a good idea to go ahead and change passwords to all your other accounts. Why so? Well, if a fraudster has your personal information, it’s only a matter of time before they move down the list to see what else they can steal. But if you are two steps ahead, their subsequent attacks will be thwarted.
Step 3: Place a Fraud Alert On Your Credit Reports
Fraud alerts are valid for one-year and greatly reduce the chances of you being victimized by identity theft. How so? Well, each time a new application for credit is made in your name, the lender or creditor has to verify your identity to confirm it’s you that’s making the request. Otherwise, the credit application will be rejected.
There’s no charge for this service, and fraud alerts can be renewed annually. To place one on your file, you’ll need to do so with each of the credit bureaus using the information below:
- Equifax: Equifax.com/personal/credit-report-services or 1-800-685-1111
- Experian: Experian.com/help or 1-888-397-3742
- TransUnion: TransUnion.com/credit-help or 1-888-909-8872
Step 4: Retrieve Your Credit Reports
If you didn’t already do so in the first step when assessing the initial damage, now’s the time to get your free credit reports from AnnualCreditReport.com. You’ll need them in a few steps when it’s time to dig deeper to analyze the information listed.
Step 5: Reach Out to the Federal Trade Commission
The next step is to notify the FTC that you’ve been victimized by identity theft. Doing so will enable them to generate an Identity Theft Report for you, along with a recovery plan to help you get back on track.
You have two options to report identity theft:
- By calling 1-877-438-4338
- By completing this form
Quick Note: the FTC also recommends that you set up an online account as it contains step by step guidance, along with useful resources, to guide you as you work to recover from identity theft. You’ll also be able to access your Identity Theft Report and recovery plan at any time from the online portal.
Step 6: File a Formal Police Report
While this step is optional, you may wish to file a report with the local authorities to substantiate your claims when dealing with companies and creditors. Be sure to bring your Identity Theft Report from the FTC and any other supporting documentation along.
They will also want proof of residency and a copy of your government-issued photo identification to prove that you are who you say you are.
The Next Steps
Once you’ve covered the bases, it’s time to dig a little deeper to undo the damages sustained by identity theft.
Take Another Look at Your Credit Report
There’s a chance that you may have overlooked fraudulent or incorrect information in your credit report the first time around. But now that you’ve started the recovery process, it’s a good idea to take another look at your credit report and compile a list of any other issues that need to be addressed.
Review All of Your Credit Card and Bank Statements
Credit reports aren’t the only documents that shed light on identity theft. Fraudsters may have managed to get ahold of your existing accounts and unleash their wrath, which is why it’s also important to review all your credit card and bank statements for fraud.
Request Replacement Cards
While you were in the process of dealing with the different fraud departments to sort things out, you may have forgotten to request replacement cards for your accounts. The creditor should’ve automatically taken care of this, but if not, go ahead and initiate requests for new ones.
It may also be wise to request new debit cards even if your bank accounts weren’t affected just in case they were next on the fraudsters list.
Request New Identification Cards
Was your identity compromised because someone stole your government-issued identification, passport, or Social Security card? Here’s how to request replacements:
- Government-Issued Identification – Use the online directory to find a DMV location near you
- Passport – Call 1-877-487-2778 to speak with the State Department
- Social Security Card – Apply for a replacement via the Social Security Administration’s website
File Disputes
As mentioned in step one, start with the fraud department to deal with bogus accounts on your credit report that you may have missed the first time around.
But if there are other errors that you’ve spotted on your credit report, you should file disputes right away. Be sure to file separate disputes with Equifax, Experian, and TransUnion since the three bureaus do not communicate.
Freeze Your Credit Reports
If your finances are in shambles and you want to an additional layer of protection to restrict all access to your credit report, consider a credit freeze. There’s no cost to place a freeze, but keep in mind that they prevent any access to your credit reports at the three credit bureaus.
You have to manually request the credit freeze to be lifted. But if you leave it intact, it will remain indefinitely.
Credit freezes can be placed via the channels below:
- Equifax: Equifax.com/personal/credit-report-services or 1-800-685-1111
- Experian: Experian.com/help or 1-888-397-3742
- TransUnion: TransUnion.com/credit-help or 1-888-909-8872
Dealing with Debt Collectors
If some of the fraudulent accounts have already been turned over to collections for nonpayment, there’s a chance debt collectors are breathing down your neck. The good news is you can stop them in their tracks by sending a letter explaining that you’ve been victimized by identity theft.
Before dropping the letter in the mail, be sure to include any supporting documentation, including the Identity Theft Report from the FTC and a police report (if applicable). Also, send via certified mail with a return receipt to confirm they received the package.
And if you haven’t done so already, reach out to the original creditor’s fraud department to notify them of the occurrence. You can also send them copies of the same correspondence you sent the collection agency so they can have the documentation on hand that they need to resolve the issue.
The Bottom Line
Moving forward, be vigilant of your activity across accounts at all times. By doing so and understanding the signs of identity theft so you can act upon suspicion, you’ll be better positioned to mitigate any issues before they get out of hand. Most importantly, if your identity is compromised, act sooner than later to have the best chance at a swift recovery.