Identity theft is a serious and growing crime, affecting millions of Americans each year. It is imperative that you learn about this crime, understand how you can protect yourself and prevent such a crime, and what you can do to recover and take action if you are a victim. If your goal is to get out and stay out of debt, then protecting your identity is absolutely essential.

What is Identity Theft?

Identity theft happens when someone else pretends to be you by using your personal information. The criminal will use your name, personal contact info., SSN, birth date, credit card numbers, bank accounts, driver’s license or passport, computer passwords, etc. to do any of the following:

1. Steal money or make purchases.
2. Open a bank account, apply for a credit card, and apply for loans, etc.
3. Sign up for any type of service: cell phone, utilities, cable, etc.

Did you know that every 79 seconds a thief steals someone’s identity? Victims spend an average of 600 hours recovering from this crime, and up to $16,000 in lost income. It has been the top consumer complaint to the FTC for five years in a row, and most do not even find out they were a victim until months after the crime. (Statistics source: creditreport.com/identitytheft/facts/statistics.aspx).

How Does Somebody Steal Your Identity?

There are numerous ways that someone could steal your information. A few of the main ways include:

1. Shoulder Surfing: This happens when someone standing nearby overhears you saying your personal information (SSN, bank account number, etc.). It could happen at a bank, ATM, at a pubic computer, overhearing a phone conversation, etc.
2. Dumpster Diving: People rummage through the trash to find documents or bills with personal information.
3. Dishonest Employees: Many employees have access to a lot of personal information. All it takes is one dishonest employee to steal, or be bribed to give away your information.
4. Stealing: Someone steals your wallet or purse.
5. Mail Fraud: They take your mail. Also, people will actually submit a ‘change of address’ form to divert mail to an unknown location.
6. Phishing: People pretending to be a financial institution (by phone, mail, or email) to get you to reveal your personal information.
7. Employment Scams: People posing as legitimate companies who are hiring, and they have you fill out an application, which divulges your SSN, birth date, personal information, etc. There are even online ‘work from home’ scams that require you to provide credit card information in order to receive a ‘work from home’ kit for training.
8. Credit Card Fraud: People posing as credit card companies warning that your card has been used as fraud, and they’ll ask you to verify your cc number and personal info.
9. Apartment Fraud: People posing as landlords of a property requiring an application to be filled out with personal information.

The list could go on and on.

How Do You Protect Your Identity?

1. Protect Personal Information: Never give out personal information (by phone, email, or in person) to any person or company you do not know or trust. Do everything you can to guard your SSN, bank accounts, passwords, and personal information, etc.
2. Keep Your Wallet Safe: 85% of credit card theft happens by someone losing their wallet or purse, or not keeping an eye on it, and having it stolen. Do NOT carry around your SSN, passport, or any other important document.
3. Protect Your Computer: Get anti-virus software to prevent viruses, hackers, and trojans that will steal your passwords and personal/financial info. Also, ensure that if you enter your credit card or personal information online, that you are doing it on a trusted and secure website. Never respond to emails or click on links that you don’t know or trust (even if it looks legitimate, or has the company logo, etc. It could be a scam). Realize that legitimate companies will NEVER call or email you to have you verify your information.
4. Identity Theft Protection: One of the most important insurances you can possibly get in our day and age is identity theft protection. If you don’t have it, get it.
5. Change Passwords Often: Change and update your passwords often. Never have your passwords written (in paper or electronic form). Use alpha-numeric characters, and never use obvious passwords or pin numbers like a birthday, maiden name, etc.
6. Monitor Your Credit Report… Often: Check your credit report often. The three credit bureaus allow you to get one free report once a year (thus, get one from each at 3 different times throughout the year). Look for any suspicious activity on your report.
7. Get a Shredder: Shred any document or paper that has important personal information on it.
8. Destroy Digital Data: Be careful of storing important info. on your computer, and be sure to destroy it if you ever exchange or sell your computer, hard drive, etc.
9. Be Aware of Scams: Don’t be ignorant. Learn about what scams are out there and educate yourself on what they are and how to avoid them.

How Do You Know If You Are a Victim?

What are the warning signs, the things you should be aware of, or how to tell if you’ve been a victim of identity theft? There are many, but below are the top 10 signs:

1. Your credit card statement includes purchases you did not make.
2. Your bank statement includes withdrawals you did not make.
3. Your credit report includes inquiries, loans, accounts, or credit cards that you did not initiate or apply for.
4. You receive notification confirming the new credit card, loan, line, account, you did not apply for. Or, you actually receive a new credit card you didn’t apply for.
5. You are denied credit or offered higher interest rates, despite the fact that you know your credit (should be) good enough to qualify for the loan or lower interest rates. Or, you get a denial of credit you did not apply for.
6. You receive credit card or bank statements in your name that you did not apply for or know about.
7. Your mail suddenly stops – you no longer receive bills, bank statements, etc. Or you applied for a loan or a credit card but are not getting statements in the mail. Or you receive notice that your mail will be forwarded or re-directed.
8. You receive email notification of a change of address on bank accounts, credit cards, etc.
9. You receive bills from companies you don’t recognize or didn’t sign up for their services.
10. Debt collection companies try to collect money on debts that you don’t know about.

How Do You Report a Crime & Take Action If You Are a Victim?

1. Submit a Fraud Alert: The first and most important thing you need to do is contact and notify the 3 credit bureaus, and place a ‘fraud alert’ on your profile. Here is their contact information:

1. Equifax: 800-525-6285 or alerts.equifax.com
2. Experian: 888-397-3742 or experian.com/fraud/center.html
3. TransUnion: 800-680-7289 or email fvad@transunion.com or visit www.transunion.com

You can also request to have a ‘freeze’ placed on your account to ensure no credit issuers can access your credit files without your permission. This ensures thieves can’t open new accounts in your name.

2. Contact Appropriate People: Contact the companies where the fraud was committed, contact the police, contact the FTC and file a report. To file a complaint with the FTC, contact them at: 877-ID-THEFT. Also, go to www.naag.org and contact your local police department or attorney general to file a complaint.

3. Close Accounts Immediately: If a bank account or credit card account has been violated, close those accounts immediately. If your credit reports shows newly opened accounts (that you did not open), close those immediately. Do keep in mind, however, that one of the keys to good credit is the length of time a credit card is opened. So, consider instead of closing the cc account, to cancel the card and get a new one.

4. Change Passwords & Pins: Immediately change all of your passwords and pin numbers.

5. Clean Your Credit Report: Get to work on removing inquiries, debts, missed or late payments, or fraud accounts from your credit report. BE SURE TO DOCUMENT EVERYTHING. Work with local law enforcement, the companies where fraud/purchases were made, the credit bureaus, financial institutions, etc. Ensure you keep records and get paper work on everything, which will assist you in your efforts to have any fraudulent activity removed from your record.

6. Identity Theft Protection: Get identity theft protection immediately.

7. Protect Your Children: Realize that this can happen to ANYONE, even innocent little children who also have a SSN. Ensure that you check the credit reports of your children often, protect their identity (and thus their financial future), and get identity theft protection/insurance for them as well.

Identity theft is real! Do you realize how much this crime could potentially affect you? Your ability to borrow money, get low interest rates, get that desired job or salary, sign up for basic services like utilities or cable, qualify for a loan or credit card, etc. – it is all dependent upon your credit score. And as great as your score and report may be, overnight it can be ruined by one person who steals your information and commits identity theft fraud.