Ways To Prevent Identity Theft
I have been a victim of identity theft. I was out of town when I woke up one morning to three missed phone calls and as many texts from my credit card company. They said, "We noticed you were in Boston for dinner last night, so we wondered if you really bought a used car this morning in Florida."
The thief's purchase was only $6,000, but it lowered my credit score, and it took over a year of phone calls and reports to have that one fraudulent transaction removed from my credit report. I shudder to think how much worse it could have been if the theft hadn't been discovered immediately and the thief had continued stealing from me.
Recent advances in technology mean criminals have more ways to steal your identity than ever before. Fortunately, other advances make it possible to catch and prevent identity theft quickly. Unfortunately, many people discover it too late because they do not monitor their account activity well enough to recognize the warning signs.
Here are five signs that may indicate your identity has been stolen:
1. Unusual purchases or other activity on your bank statement.
2. Discrepancies on your credit report, especially new accounts you don’t recognize.
3. Receiving phone calls or mail from collection agencies.
4. If you stop receiving mail, like bank statements or credit card statements.
5. Notification of incorrect income filing from the IRS.
As the old saying goes, “An ounce of prevention is worth a pound of cure,” so here are a few things you can do to prevent and catch identity theft or minimize the damage:
1. Invest in RFID-blocking technology. With the advent of chip cards, thieves can use RFID readers to pull personal information from your credit or debit card while they are standing in line behind you at Starbucks. Protect yourself with an RFID-blocking wallet or sleeves for your credit and debit cards, as well as for your passport.
2. Sign up for credit alerts with your bank and credit card companies. Make sure you are notified immediately if anyone – even you – makes a large withdrawal or purchase, or changes the mailing address or phone number on your account.
3. Check your statements regularly. Since I've been burned, I check my account activity online every morning. You don't have to be quite that vigilant, but I recommend reviewing this at least once a week.
4. Don't throw away junk mail without opening it. Collection notices are often mistaken for junk since federal regulations prevent collection agencies from printing identifying information on their mailing envelopes. If you see something from an unknown sender, it’s a good idea to open it to make sure it's not a collection notice. If you aren’t happy about doing this because you get too much junk mail, you can reduce it if you opt out of certain types of offers.
5. Set a limit on withdrawal amounts. Standard withdrawal limits may vary from one bank to another or from one ATM to another. Find out what your bank allows and lower it if the maximum is more than you are comfortable with.
6. Sign up for LifeLock or other identity theft prevention/monitoring service.
Finally, if your identity has been stolen, don’t immediately blame yourself or your spouse. Identity theft is simply a reality of the world we live in today. It’s best not to waste precious time playing the blame game when you need to be doing what you can to stop further theft.
According to the Federal Trade Commission, there are three things you should do if you detect identity theft:
1. Notify any affected companies. If someone has bought a used car under your name, notify the dealer immediately. If someone bought a $500 bottle of perfume at Macy's, report the theft to Macy's and to your credit card company.
2. Notify one of the three major credit bureaus and ask them to "freeze" your credit. A freeze prevents anyone who may try to pull your credit report from seeing fraudulent activity. It lasts for 90 days, but it can be renewed if you need more time to resolve the issue. You only have to notify one bureau; that one is then required to notify the other two.
3. Report the theft to your local police and to the FTC at identitytheft.gov. Hold on to both reports because you will need them to make an identity theft claim.