How Identity Theft Occurs
Skilled identity thieves use a variety of
methods to gain access to your personal information. For example:
- They get information from businesses
or other institutions by:
- stealing records from their employer,
- bribing an employee who has access
to these records, or
- hacking into the organization's computers.
- They rummage through your trash, or the
trash of businesses or dumps in a practice known as "dumpster
- They obtain credit reports by abusing
their employer's authorized access to credit reports or
by posing as a landlord, employer, or someone else who may
have a legal right to the information.
- They steal credit and debit card numbers
as your card is processed by using a special information
storage device in a practice known as "skimming."
- They steal wallets and purses containing
identification and credit and bank cards.
- They steal mail, including bank and credit
card statements, pre-approved credit offers, new checks,
or tax information.
- They complete a "change of address form"
to divert your mail to another location.
- They steal personal information from your
- They scam information from you by posing
as a legitimate business person or government official.
Once identity thieves have your personal
information, they may:
- Go on spending sprees using your credit
and debit card account numbers to buy "big-ticket" items
like computers that they can easily sell.
- Open a new credit card account, using
your name, date of birth, and SSN. When they don't pay the
bills, the delinquent account is reported on your credit
- Change the mailing address on your credit
card account. The imposter then runs up charges on the account.
Because the bills are being sent to the new address, it
may take some time before you realize there's a problem.
- Take out auto loans in your name.
- Establish phone or wireless service in
- Counterfeit checks or debit cards, and
drain your bank account.
- Open a bank account in your name and write
bad checks on that account.
- File for bankruptcy under your name to
avoid paying debts they've incurred, or to avoid eviction.
- Give your name to the police during an
arrest. If they are released and don't show up for their
court date, an arrest warrant could be issued in your name.
How Can I Tell if I'm a Victim of Identity
Monitor the balances of your financial accounts.
Look for unexplained charges or withdrawals. Other indications
of identity theft can be:
- failing to receive bills or other mail
signaling an address change by the identity thief;
- receiving credit cards for which you did
- denial of credit for no apparent reason;
- receiving calls from debt collectors or
companies about merchandise or services you didn't buy.
Are There Any Other Steps I Can Take?
If an identity thief is opening new credit
accounts in your name, these accounts are likely to show up
on your credit report. You can find out by ordering a copy
of your credit report from any of three major credit bureaus.
If you find inaccurate information, check your reports from
the other two credit bureaus. Of course, some inaccuracies
on your credit reports may be because of computer, clerical,
or other errors and may not be a result of identity theft.
Note: If your personal information has been
lost or stolen, you may want to check all of your reports
more frequently for the first year. Federal law allows credit
bureaus to charge you up to $9 for a copy of your credit report.
Some states may allow a free report or reduced rates.
Managing Your Personal Information
So how can a responsible consumer minimize
the risk of identity theft, as well as the potential for damage?
When it involves your personal information, exercise caution
Do It Now
Place passwords on your credit card, bank
and phone accounts. Avoid using easily available information
like your mother's maiden name, your birth date, the last
four digits of your SSN or your phone number, or a series
of consecutive numbers. When you're asked for your mother's
maiden name on an application for a new account, try using
a password instead.
Secure personal information in your home,
especially if you have roommates, employ outside help, or
are having service work done in your home.
Ask about information security procedures
in your workplace. Find out who has access to your personal
information and verify that your records are kept in a secure
location. Ask about the disposal procedures for those records
Don't give out personal information on the
phone, through the mail, or over the Internet unless you've
initiated the contact or are sure you know who you're dealing
with. Identity thieves can be skilled liars, and may pose
as representatives of banks, Internet service providers (ISPs),
or even government agencies to get you to reveal identifying
information. Before you divulge any personal information,
confirm that you're dealing with a legitimate representative
of a legitimate organization. Double check by calling customer
service number on your account statement
or in the telephone book.
Guard your mail and trash from theft. Deposit
outgoing mail in post office collection boxes or at your local
post office instead of an unsecured mailbox. Remove mail from
your mailbox promptly. If you're planning to be away from
home and can't pick up your mail, call the U.S. Postal Service
at 1-800-275-8777 to ask for a vacation hold. To thwart a
thief who may pick through your trash or recycling bins, tear
or shred your charge receipts, copies of credit applications
or offers, insurance forms, physician statements, checks and
bank statements, and expired charge cards.
Before revealing any identifying information
(for example, on an application), ask how it will be used
and secured, and whether it will be shared with others. Find
out if you have a say about the use of your information. For
example, can you choose to have it kept confidential?
Keep your Social Security card in a secure
place and give your SSN only when absolutely necessary. Ask
to use other types of identifiers when possible. If your state
uses your SSN as your driver's license number, ask to substitute
Limit the identification information and
the number of credit and debit cards that you carry to what
you'll actually need.
Keep your purse or wallet in a safe place
Consider Your Computer
Your computer can be a goldmine of personal
information to an identity thief. Here's how you can safeguard
your computer and the personal information it stores:
- Update your virus protection software
regularly. Computer viruses can have damaging effects, including
introducing program code that causes your computer to send
out files or other stored information. Look for security
repairs and patches you can download from your operating
system's Web site.
- Don't download files from strangers or
click on hyperlinks from people you don't know. Opening
a file could expose your system to a computer virus or a
program that could hijack your modem.
- Use a firewall, especially if you have
a high-speed or "always on" connection to the Internet.
The firewall allows you to limit uninvited access to your
computer. Without a firewall, hackers can take over your
computer and access sensitive information.
- Use a secure browser -- software that encrypts
or scrambles information you send over the Internet -- to
guard the safety of your online transactions. When you're
submitting information, look for the "lock" icon on the
status bar. It's a symbol that your information is secure
- Try not to store financial information
on your laptop unless absolutely necessary. If you do, use
a "strong" password -- that is, a combination of letters
(upper and lower case), numbers, and symbols.
- Avoid using an automatic log-in feature
that saves your user name and password; and always log off
when you're finished. If your laptop gets stolen, the thief
will have a hard time accessing sensitive information.
- Delete any personal information stored
on your computer before you dispose of it. Use a "wipe"
utility program, which overwrites the entire hard drive
and makes the files unrecoverable.
- Read Web site privacy policies. They should
answer questions about the access to and accuracy, security,
and control of personal information the site collects, as
well as how sensitive information will be used, and whether
it will be provided to third parties.
A Special Word About Social Security Numbers
Very likely, your employer and financial
institution will need your SSN for wage and tax reporting
purposes. Other private businesses may ask you for your SSN
to do a credit check, such as when you apply for a car loan.
Sometimes, however, they simply want your SSN for general
record keeping. If someone asks for your SSN, ask the following
- Why do you need it?
- How will it be used?
- How do you protect it from being stolen?
- What will happen if I don't give it to
If you don't provide your SSN, some businesses
may not provide you with the service or benefit you want.
Getting satisfactory answers to your questions will help you
to decide whether you want to share your SSN with the business.
If Your Identity's Been Stolen
Even if you've been very careful about keeping
your personal information to yourself, an identity thief can
strike. If you suspect that your personal information has
been used to commit fraud or theft, take the following four
steps right away. Remember to follow up all calls in writing;
send your letter by certified mail, return receipt requested,
so you can document what the company received and when; and
keep copies for your files.
- Place a fraud alert on your credit
reports and review your credit reports.
Call the toll-free fraud number of anyone of the three major
credit bureaus to place a fraud alert on your credit report.
This can help prevent an identity thief from opening additional
accounts in your name. As soon as the credit bureau confirms
your fraud alert, the other two credit bureaus will automatically
be notified to place fraud alerts on your credit report,
and all three reports will be sent to you free of charge.
- Equifax - To report fraud, call:
1-800-525-6285, and write: P.O. Box 740241, Atlanta, GA
- Experian - To report fraud, call:1-888-EXPERIAN
(397-3742), and write: P.O. Box 9532, Allen, TX 75013
- TransUnion - To report fraud,
call:1-800-680-7289, and write: Fraud Victim Assistance
Division, P.O. Box 6790, Fullerton, CA 92834-6790
Once you receive your reports, review them
carefully. Look for inquiries you didn't initiate, accounts
you didn't open, and unexplained debts on your true accounts.
You also should check that information such as your SSN,
address(es), name or initial, and employers are correct.
Inaccuracies in this information also may be due to typographical
errors. Nevertheless, whether the inaccuracies are due to
fraud or error, you should notify the credit bureau as soon
as possible by telephone and in writing. You should continue
to check your reports periodically, especially in the first
year after you've discovered the theft, to make sure no
new fraudulent activity has occurred. The automated "one-call"
fraud alert process only works for the initial placement
of your fraud alert. Orders for additional credit reports
or renewals of your fraud alerts must be made separately
at each of the three major credit bureaus.
- Close any accounts that have been tampered
with or opened fraudulently.
Credit Accounts Credit accounts include
all accounts with banks, credit card companies and other
lenders, and phone companies, utilities, ISPs, and other
If you're closing existing accounts and
opening new ones, use new Personal Identification Numbers
(PINs) and passwords.
If there are fraudulent charges or debits,
ask the company about the following forms for disputing
- For new unauthorized accounts, ask if
the company accepts the ID Theft Affidavit (available
If they don't, ask the representative to send you the
company's fraud dispute forms.
- For your existing accounts, ask the
representative to send you the company's fraud dispute
- If your ATM card has been lost, stolen
or otherwise compromised, cancel the card as soon as you
can. Get a new card with a new PIN.
If your checks have been stolen or misused,
close the account and ask your bank to notify the appropriate
check verification service. While no federal law limits
your losses if someone steals your checks and forges your
signature, state laws may protect you. Most states hold
the bank responsible for losses from a forged check, but
they also require you to take reasonable care of your account.
For example, you may be held responsible for the forgery
if you fail to notify the bank in a timely way that a check
was lost or stolen. Contact your state banking or consumer
protection agency for more information.
You also should contact these major check
verification companies. Ask that retailers who use their
databases not accept your checks.
- TeleCheck - 1-800-710-9898 or
- Certegy, Inc. - 1-800-437-5120
- International Check Services
Call SCAN (1-800-262-7771) to find out if the identity
thief has been passing bad checks in your name.
- File a report with your local police
or the police in the community where the identity theft
Keep a copy of the report. You may need it to validate your
claims to creditors. If you can't get a copy, at least get
the report number.
- File a complaint with the FTC.
By sharing your identity theft complaint with the FTC, you
will provide important information that can help law enforcement
officials track down identity thieves and stop them. The
FTC also can refer victim complaints to other appropriate
government agencies and companies for further action. The
FTC enters the information you provide into our secure database.
To file a complaint or to learn more about
www.consumer.gov/idtheft. If you don't have access to
the Internet, you can call the FTC's Identity Theft Hotline:
toll-free 1-877-IDTHEFT (438-4338); TDD: 202-326-2502; or
write: Identity Theft Clearinghouse, Federal Trade Commission,
600 Pennsylvania Avenue, NW, Washington, DC 20580.
The FTC works for the consumer to prevent
fraudulent, deceptive and unfair business practices in the
marketplace and to provide information to help consumers
spot, stop, and avoid them. To file a complaint or to get
free information on consumer issues, visit www.ftc.gov
or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY:
1-866-653-4261. The FTC enters Internet, telemarketing,
identity theft, and other fraud-related complaints into
Consumer Sentinel, a secure, online database available to
hundreds of Il and criminal law enforcement agencies in
the U.S. and abroad.