Recovering from Identity Theft

It seems like there is an announcement regarding another large scale data breach almost every week. Anthem, Target, Sony PlayStation, and most recently the credit reporting giant Equifax represent just a few of the companies whose data breaches have hemorrhaged the sensitive personal information of millions of Americans in recent years. These breaches can result in identity theft.

Identity theft sadly continues to become a more and more common reality of life despite extensive efforts to curb this crime. According to one study there were nearly 15 and a half million victims of identity fraud in 2016 alone.

Although there seems to be no end to this growing crime, there is a small bit of good news. If you are ever a victim of identity theft there are a number of rights afforded to you which will hopefully make recovering from the theft less painful. Read below to discover 5 important steps which can help you to create an effective identity theft recovery plan.

1. Place a Credit Freeze – Most Extreme

Freezing your credit reports is a big deal, but one which is probably necessary if you discover or even strongly suspect that an identity thief has attempted to open fraudulent accounts using your personal information. When you freeze your credit reports with each of the 3 credit reporting agencies (a free service for victims of identity theft) you are essentially taking your credit reports out of circulation so that no new lender will be able to access your reports unless you purposefully “thaw” them first. Once your reports with Equifax, TransUnion, and Experian are frozen the chances of any additional accounts being opened in your name are very slim since most lenders will simply turn down an application if a credit report and score are unavailable for review.

2. Fraud Alerts – Less Extreme

Fraud alerts will inform future creditors that you were the victim of identity theft or you suspect you’re a target. These alerts force lenders to contact you to verify the authenticity of any new credit application. The alerts are free and easy to place. By calling just 1 of credit reporting agencies (CRAs) you can place a fraud alert on your reports at all 3 bureaus. Fraud alerts can be placed for either 90 days or up to 7 years if you are able to provide proof of the theft to the CRAs.

3. Review Your 3 Reports – Least Extreme

It is important to review all 3 of your credit reports periodically anyway, but especially if you suspect that your personal information has been compromised. You can claim a free copy of your 3 reports once every 12 months at AnnualCreditReport.com. Once you have your reports, look carefully for any red flags. Are there credit inquiries you did not authorize? Are there any accounts or collections present which you do not recognize? Any addresses where you’ve never lived? All of these are signs indicative of fraud.

4. Official Report

If your credit reports confirm that your identity has indeed been used fraudulently, your next step should most likely be to file an official identity theft report and/or police report documenting the theft with a law enforcement agency. You can visit IdentityTheft.gov for help creating an official identity theft report with the Federal Trade Commission. Once created you can also use your FTC Identity Theft Report to file an additional report with your local police department, if you like. Be sure to ask for a copy of the police report after filing.

5. Inform Everyone

Simply filing an identity theft report and/or police report is not going to be enough to clean up credit report damage. You will still need to inform the CRAs and potentially the creditors who permitted the opening of the fraudulent accounts as well.

Thankfully, the Fair Credit Reporting Act requires the CRAs to act very quickly to help you in cases of identity theft. When you submit a dispute to the CRAs which includes a copy of an official identity theft report any fraudulent accounts must legally be removed from your credit reports within just 4 business days.