Identity Theft and Recovery
Protecting Yourself from Identity Theft
Identity theft occurs when an assailant impersonates you for their own gain using stolen information that is often used to identify you (i.e. your Social Security Number, address, etc.). Examples of some of the nefarious actions that may be carried by a criminal using your identity include:
- Opening bank or credit accounts tied to you
- Filing a bogus tax return and collecting your refund
- Making online purchases, sometimes with the intention of selling those goods on the black market
- Claiming your identity to shift medical expense liability (Medical Identity Theft)
If you think you've been a victim of identity theft we recommend reviewing the Recovering from Identity Theft section below and visiting IdentityTheft.gov.
Knowing common identity theft schemes
There are many ways for identity theft to occur. The incidents can range from having your debit or credit card used to purchase items to being denied loans from fraudulent credit reports. Using individual best practices reduces your risk.
One example occurred in 2006 in Salt Lake City, Utah. A responsible mother of four, Anndorie Sachs, received a startling phone call; her newborn baby tested positive for illegal drugs. Impossible. She hadn’t given birth in years.
It got worse when the Utah Division of Child and Family Services (DCFS) arrived the next day proclaiming her an unfit mother and threatening legal action to remove her children, aged 2 to 7. As she and her husband sat anxiously awaiting the agent assigned to the case, Anndorie’s 7-year-old daughter was being pulled from her first-grade classroom.
Two months earlier, Anndorie’s driver’s license was stolen from her vehicle. That license allowed the mother of the baby who tested positive for illegal drugs to walk into a hospital, give birth, and to leave Anndorie with a $10,000 bill for medical expenses while subjecting her, and her family, to serious consequences.
After much effort, including providing a DNA test proving she wasn’t the infant’s mother, she was cleared of responsibility.
Long-lasting effects of medical fraud can linger. In the case described here, Anndorie’s medical records had been altered to include the blood type and other medical details of the identity criminal. While it may seem as though it would be easy to remove these fraudulent details from Anndorie’s record, it proved to be shockingly difficult. In fact, even now, Anndorie can’t be sure all medical records have been corrected as the Health Insurance Portability and Accountability Act of 1996 (HIPAA) regulations prevent her from seeing the details, included in her own record, of the identity criminal.
According to the Federal Trade Commission, the following are common methods used by identity thieves:
- Stealing: Wallets and purses; mail, such as credit card and bank statements; pre-approved credit offers; new checks; personnel records; passport or license; or tax information.
- Phishing: Fake email, spam, or pop-up messages look as if they are from actual financial institutions or businesses. You are requested to reveal your personal information in order to renew an account, receive the prize, etc.
- Dumpster Diving: Bills or other paper with personal information is taken from your trash.
- Changing Your Address: Billing statements in your name are diverted to another location by completing a "change of address" form.
- Skimming: Credit or debit card numbers are stolen by using a special storage device when processing your card.
Recognizing common indicators that your identity has been stolen
Things to watch for:
- late or missing bills
- receiving credit cards you did not apply for
- calls or letters about purchases you did not make
- suspicious purchases or withdrawals on your credit or bank statements
- denials of credit or being offered less favorable terms for no apparent reason
- a letter from the IRS indicating more than one tax return was filed with your SSN
- your credit report, which includes the accounts you have and your bill paying history
- your bank statements, which you should check for any withdrawals or account activity you did not approve
- your credit statements, which you may choose to receive online or place security alerts on in order to detect fraud
- other financial statements
Protecting your identity
There are many commercial companies that sell “Identity Protection.” The most well-known is LifeLock(link is external). These operations provide a combination of services, typically including:
Freezing your credit is an effective form of protection if you believe you may have been a victim of identity theft. You can freeze your credit with all 3 major credit reporting agencies by calling the numbers below. This will create a pin number or password on your account that the agencies will require you provide before opening new credit accounts.
- Scans of various sources, like the Dark Web, to find who may have your identifying information
- Alerts when there is unusual activity on your credit
- Restoration of your identity when they have identified that it is stolen
- “Insurance,” or more accurately reimbursement, for losses you incur due to the theft of your personal identification information
You should note, however, that there's a lot you can do to protect yourself without purchasing a service. There is both value and cost to entering into an identity protection agreement. Be sure to read the fine print and know what you are getting.
There are also some simple tips you can follow that don’t cost anything (source: Federal Trade Commission(link is external)).
- If you notice fraudulent charges on an account, call that institution and, if they haven’t already done so for you, cancel the account immediately
- Report a lost or stolen driver’s or state identification card immediately through your state’s card issuer
- If a credit card company, or any company that has your data and was previously breached, offers free credit monitoring, take advantage of it.
- Review your credit report at least annually. You can do so FREE(link is external).
- File your taxes early, before a scammer can. Respond right away to letters from the IRS.
- Monitor medical records thoroughly for charges you didn’t incur or services and procedures you didn’t have performed.
- If you stop receiving medical bills, call your insurer or health provider; one steps an identity thief will take is changing the address of your bills to cover their tracks.
- If you believe one or more of your accounts have been compromised, like banking or credit accounts, log into the accounts (if you can) and change your password. If you cannot log in, call the customer service line of the applicable institution and speak with a representative as soon as you can.
A pervasive social engineering scam has been occurring in recent years. An attacker will call you and claim to be from the IRS to try to get your personal information. Do not believe them, even if they have your partial social security number. You can confirm whether the IRS really needs to speak with you by looking up their official phone number and calling them directly. Do not contact the IRS with using a phone number, website or any other information provided by the original caller. Also, be sure to gather as much identifying information as you can from the person who originally called you claiming to be from the IRS so that you can either confirm their true identity as an IRS agent or, more likely, report the details of the social engineering attack to a legitimate IRS representative.
Recovering from Identity Theft
Identity theft can be initiated in a number of ways. You may receive a notice from a company you do business with that says your personal information was exposed in a data breach. You could lose your wallet. Someone could hack your online account, such as an ecommerce site or social media site.
If you suspect you are a victim of identity theft, please consider the above-listed steps the Federal Trade Commission suggests. However, there are a few other things you can do for yourself in an effort to achieve a quicker recovery:
Notify lender or bank
Shutting down the rogue account or line of credit should be your first priority. Also, you should notify any legitimate accounts you have, so those institutions can issue you a new card or account number while shutting down activity to those accounts. According to the Electronic Fund Transfer Act, reporting a lost or stolen ATM or debit card before fraudulent transactions guarantees you are not liable for those charges. Those protections have expirations, so ACT QUICKLY!
Place a “fraud alert” on your credit report
This is probably the best step to take if you are unsure about whether you are a victim (see above). It will last for 90 days so you may wish to consider renewing.
Check your credit reports
It is always a good practice to keep an eye on your credit to spot unauthorized accounts or transactions. This is especially true if you believe you are a victim of identity theft.
Consider a credit freeze
A credit freeze will completely lock your identity from being able to open new credit accounts. Although you have to jump through some hoops to be able to open up new accounts for yourself, it may be worth the time. You can freeze your credit with all 3 major credit reporting agencies by calling the numbers below. This will create a pin number or password on your account that the agencies will require you provide before opening new credit accounts.
- Equifax: 1-800-349-9960
- Experian: 1‑888‑397‑3742
- TransUnion: 1-888-909-8872
File a local police report
This can be of critical importance if legal proceedings stem from identity theft. If your local police seem unhelpful for any reason, the FTC provides a cover letter outlining the importance of their participation for consumer victims.
Supply creditors with your ID theft report
Notifying your creditors in writing can be a critical step to protecting yourself from getting stuck with the costs of identity theft. These creditors may be necessary in cleaning up the mess by providing documentation to your law enforcement partners. Providing them with the documentation helps them help you.
Notify credit reporting agencies
Sending these reports to these agencies may stem the tide of negative information adhering to your credit report.
Contact the Social Security fraud hotline
Get a new driver’s license
Updating your driver’s license means your previous state ID will be invalid. This is helpful if someone is physically attempting to impersonate you.
Contact phone and utility companies
This is a good idea in case someone wants to use your utility bill as a second source of proof that the are you.
Review your credit report and bank statements
Review credit and bank statements for unauthorized charges. Keep an eagle eye on your statements, even months after an assumed identity theft. Don’t forget dormant or infrequently used accounts either. If anything nefarious shows, contact the card issuer immediately.
Consider identity protection
It isn’t a bad idea to consider a third party credit monitoring service.