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Recovering from identity theft can be a long and complicated process. Protecting your identity from cybercriminals and identity thieves is very important.
According to the 2022 Identity Fraud Study by Javelin Strategy & Research, 15 million Americans fell victim to identity theft. This situation caused approximately $24 billion in losses. Traditional identity theft accounted for half of the problem and targeted 27 million people in 2021, resulting in $28 billion in losses.
In this article, learn more about the steps you can take if you suspect identity theft, including the federal laws surrounding identity theft and how to prevent future incidents from occurring.
8 Important Steps to Take If You Suspect Identity Theft
Preventing identity theft is more than just setting up two-factor authentication or a VPN on your devices. It starts with being vigilant about transactions that require you to provide your personal information.
Here are some of the important steps you can take if you think someone has stolen your identity:
Step 1: File an Identity Theft Report with the FTC
The Federal Trade Commission compiles information about identity theft cases, which law enforcement agencies like the FBI may use. To file a report, visit www.identitytheft.gov to receive a recovery plan and prefilled letters/forms to report to the police and dispute fraudulent charges.
Only impersonation or financial gain cases should be reported to the FTC, not stolen credit card numbers or security breaches.
Step 2: Place a Fraud Alert with a Credit Reporting Agency
Contact one of the three major credit-rating agencies, like Equifax, Experian, or TransUnion, and ask them to place a fraud alert on your account. This alert will require businesses to verify the identity of anyone who applies for credit in your name.
You can get a free alert for 90 days with one extension or a free seven-year sign with two credit reports over the next year. Additionally, you can lock your credit reports to prevent organizations from accessing them, called a “freeze.”
Step 3: Contact the Police in Your Area
Notifying your local police department can be helpful. A police report is an essential document because it creates a record of what happened.
Having proof that your identity was stolen can make it easier to fix the problem. Your report could help them track identity theft in your area and catch any potential suspects.
Step 4: Notify Your Bank and Any Other Companies Affected by the Theft
If you find out someone has used your personal information to make unauthorized purchases or access your bank accounts, take immediate action. Call your bank and any other companies where the fraud occurred.
Make sure to contact the fraud department of any other financial companies where you have accounts as well. The companies may need you to confirm your identity with personal information like your address, date of birth, or the last four digits of your Social Security number.
Step 5: Freeze Your Credit
One way to protect your credit information is by freezing your credit. This means no one can see your credit report without your permission. It can also help protect children’s credit information from being stolen.
You need to contact each credit bureau to freeze your credit, but it’s free, and you can remove the freeze whenever you want.
Step 6: Review Your Credit Reports
It’s essential to watch for accounts you didn’t open, whether you’ve been a victim of credit card fraud or identity theft. To help you do this, the law lets you get at least one free credit report yearly from each of the three major credit agencies.
While some sites and companies might claim to offer free credit reports, the only official site to get them is AnnualCreditReport.com.
Step 7: Scan Your Bank or Credit Card Statements
Review your credit card and bank statements to check for unauthorized charges Check even the accounts you don’t use sparingly. If you find charges you don’t know about, inform your financial institution immediately.
They can lock or close the account for you. If you’re an identity theft victim, it’s important to talk to your bank or credit card company to figure out how to stop the thief from taking any more of your money.
In most cases, you’ll have to close and open new accounts, even if they weren’t part of the theft. It might be a pain, but it’s essential to stop the thief from getting more control over your money.
Step 8: Secure Your Accounts
You should check your passwords and ensure they’re strong, and it can be helpful to use a password manager. Another good idea is to turn on two-factor authentication whenever it’s available, which means you’ll need a password and a code sent to you by email, text, or phone to get into your account.
Aside from the steps mentioned above, there are other steps you can take to protect yourself too. Make sure to shred any papers with personal information, and don’t carry your Social Security number in your wallet.
Be careful about clicking on links in emails from people you don’t know or who seem suspicious. Also, delete personal information from your social media and other online profiles, like your address and phone number. By taking these precautions, you can reduce the risk of identity theft in the future.
Federal Laws Surrounding Identity Theft
Knowing your rights under federal law is essential if you become a victim of identity theft.
One of the most significant laws that can help you is the Fair Credit Reporting Act. This act outlines the rules businesses must follow when using their credit information and offers certain consumer rights. These consumer rights include your request to:
- Know when your credit information is being used against you
- An accurate credit report
- Know the contents of your credit report
- Dispute any errors in your report
- Seek damages for any violation of your rights
Other federal laws can also protect you, including:
- Fair Credit Billing Act
- Electronic Fund Transfer Act
- Crime Victims’ Rights Act
- Fair and Accurate Credit Transactions Act of 2003
- Identity Theft Assumption and Deterrence Act
- Identity Theft Penalty Enhancement Act
These laws work together to safeguard your rights and ensure you are treated respectfully throughout any transaction you make.
Fraud Alert Vs. Credit Freeze
Credit freeze and fraud alerts may safeguard you against identity fraud or hinder any other abuse of your sensitive data in the event of theft.
Who can do it: Anyone
What it accomplishes: A credit freeze prevents unauthorized access to your credit report. It also prevents you from opening new credit. Lifting the freeze temporarily to apply for new credit is possible. While the freeze is in place, you can still perform tasks such as applying for a job, renting an apartment, and purchasing insurance without lifting or removing it.
How long does it stay: A credit freeze remains in place until you remove it.
Cost: No charge.
How you can do it: Contact all three credit bureaus, Equifax, Experian, and TransUnion, and let them know you want a credit freeze.
Who can do it: Anyone who suspects unauthorized access to their accounts can set a fraud alert on their credit report.
What it accomplishes: A fraud alert will increase the difficulty for someone to initiate a new credit account in your name. A business must authenticate its identity before granting new credit in its name.
When you set a fraud alert on your credit report, you will receive a complimentary copy of your credit report from each of the three credit agencies.
How long does it stay: A fraud alert remains active for one year. After one year, you may renew it.
Cost: No charge.
How to set up: Reach out to any one of the three national credit agencies. There is no need to contact all three. The credit bureau you approach will notify the other two to set a security notification on your credit report.
Credit freeze and fraud alerts are practical tools to protect yourself from identity theft and unauthorized access to your credit accounts.
While both have advantages and differences, they are both easy to set up, and the best part is that there is no cost involved. It is always better to be proactive when safeguarding your personal and financial information.
Identity theft is a growing problem, with millions of people falling victim to it yearly. Taking action immediately is essential if you suspect your identity has been stolen.
The eight steps outlined in this article can help you recover from identity theft and prevent future incidents. Additionally, it’s important to take proactive measures to reduce the risk of identity theft.
By staying vigilant and taking action when necessary, you can protect yourself and your finances from the devastating effects of identity theft.