Identity Theft - the Ultimate Identity Crisis

Instead of a ransom note, unexpected bills begin arriving from companies you don't recognize. The phone rings, and a collections agent begins lecturing you about fiscal responsibility. A flatbed truck backs into your driveway to repossess your vehicle. The ATM eats your cash card. Your power, cable TV, and telephone services are shut off. The Internal Revenue Service threatens to garnish your wages. The police arrive to question you about credit card fraud. What happened?

Someone stole your identity.

What is identity theft?

Someone swipes your name, your credit card number, or your Social Security number and begins racking up bills. You may not even know it, until a bill collector contacts you, or the bank freezes your accounts. You may even be arrested for fraud or other crimes the identity thief actually committed.

It may take months to restore your solid credit rating and your own good name. In the meantime, you may miss out on important opportunities: college grants, job placements, automobile loans. Even your health and life insurance may be affected, if the thief obtains medical care in your name.

How can you tell if your identity is stolen?

Check your billing statements every month. Audit these carefully, and report any unknown charges. If you fail to receive a regular bill on time, contact the issuing company immediately.

Be alert for any unexpected invoices, charge accounts, or other unanticipated legal or financial issues.

Check your credit status regularly. (You can do this online by contacting any of the major credit reporting agencies. In the US, these are: Experian, Equifax, and TransUnion.)

If you detect identity theft, file a police report immediately. This will place an alert on your credit rating and a lookout for the thief. The next time he charges anything or files for credit, he may be caught. An Identity Theft Report will be filed, which will greatly improve your chances of clearing up your credit rating.

Where did the crooks obtain your private information in the first place?

Clever criminals grab confidential data by stealing wallets and purses, intercepting mail, confiscating personnel records, nabbing numbers off charge slips, and even rummaging through trash bins. Copying account numbers from invoices and receipts is a favorite ploy. Posing as telemarketers or telephone bankers, they may even ask you directly for your data.

The internet has created new opportunities for these crafty folks, who may hack into unsecured sites or set up false companies to obtain your statistics. Before you know it, your privacy has been violated!

What do criminals do with your confidential information?

Essentially, an identity thief attempts to set himself up as you. Using your personal information, a thief may change your mailing address to divert your monthly billing statements to himself. Most likely, posing as you, he will apply for credit cards.

He may do the same with an apartment lease, utility and cable TV services, internet providers, and more. He may obtain a home or cellular telephone and ring up unpaid charges on a delinquent account. The crook may take out a car loan or even a home mortgage - all in your name. In the worst cases, the identity thief may even obtain a driver's license, obtain welfare or other government benefits, and file a tax return (or fail to do so) - all to your discredit.

Of course, when the bills remain unpaid, your credit rating will plummet.

What is your credit rating?

Your credit rating is a universally accepted measurement of your eligibility to receive financing.

A high credit rating indicates you have demonstrated fiscal responsibility in the past and are likely to continue to do so. This makes you a good risk for a financial institution, a prospective employer, a homebuyer, an automobile purchaser, or an insurance client. Your credit rating may determine what loans you may be able to obtain, credit cards you may hold, and interest rates you may be asked to pay.

A poor credit rating is considered a red flag, signaling a high probability of financial irresponsibility or defaulting on a mortgage or loan.

Once a poor credit score is assigned, it can be extremely difficult to erase it.

How can you prevent identity theft?

Guard your personal information carefully. Shred identifying documents before trashing them. (We even remove address labels from magazines and catalogs before recycling them. We also toss the enclosed order forms containing our address and account information.) Tear up promotional credit card offers.

Destroy credit cards you do not use regularly, and close out any dormant accounts.

Protect your solid reputation. After all, you earned it!