Identity Theft Recovery: 6 Essential Steps To Get Back On Your Feet
The number of reported identity theft incidents continues to climb. Twenty years ago, these types of crimes tallied less than a quarter-million annually. Today, the Federal Trade Commission (FTC) receives more than 1 million identity theft complaints every year. The Bureau of Justice Statistics reports that nearly 25 million Americans have been victimized by identity theft schemes over a 12-month period. There is no indication these highly-targeted crimes are going to wane anytime soon. It’s crucial to take precautions and know how to recover if it happens to you.
How to Recover from Identity Theft
The largest number of identity theft incidents involve the misuse of Social Security numbers. With those nine digits in hand, criminals open credit cards and bank accounts in the victim’s name. When thieves gain access to driver’s licenses, mailing addresses, passport information, and others, they can orchestrate what is known as synthetic identity theft.
This means criminals may be able to reroute your mail, take out loans, and open checking accounts for the purpose of writing bad checks. When repeat offenders get arrested, they sometimes trick law enforcement into believing they are you. When creditors start contacting you about outstanding debts, strange charges appear on credit card statements, or the police show up with an arrest warrant, honest people suddenly feel the weight of being an identity theft victim. Undoing the damage of identity theft is possible. If you fall victim to identity theft, take these steps to get back on your feet.
Step 1: File a Report
Reversing the damage done by identity thieves starts with filing a report with the FTC. Filing a complaint helps you document the fact criminals used your personal information. It also helps absolve you of the debts and crimes perpetrated by unscrupulous parties. Visit IdentityTheft.gov and follow the steps to create a report. Once you complete the process, print out copies of the complaint and provide them to local law enforcement.
What You Will Need to Report Identity Theft
It may seem almost ironic given the crime, but you’ll need to prove your identity to the FTC. Official documents usually include a Social Security card, driver’s license, state-issued ID, passport, and birth certificate.
Step 2: Freeze Your Credit and Place a Fraud Alert with Major Credit Bureaus
The effects of identity theft are far-reaching. Your financial health and well-being can be upended, along with suffering with a negative reputation. One of the harms that eventually surfaces involves your credit score. The unpaid and late credit card bills, bad checks, and loan defaults orchestrated by criminals will all be reported to the three major bureaus — Experian, Equifax, and TransUnion and impact your credit.
Contact Experian, Equifax, and TransUnion, provide a copy of the FTC complaint and show official documents proving your identity. Once you’ve convinced the organizations you are who you say you are, request a credit freeze to ensure identity thieves cannot continually damage your credit score.
Review and Dispute False Credit Report Activity
To revive your previously good credit, you will need to request free copies of your credit history and get to work ferreting out the blemishes caused by fraudsters. You may find additional accounts and debts you weren’t aware of. Then, notify the credit bureaus and ask for them to be corrected so that you can begin the process of restoring your rightful credit score.
It’s also a good practice to store Social Security cards, birth certificates, marriage documents, banking records, and others in a secure place. A home safe or lock box makes it difficult for thieves to gain access.
Step 3: Call the Company/Financial Institution Where Fraud Occurred
The FTC and police reports will provide a strong foundation when dealing with financial institutions. These documents serve as proof that lenders and retailers were scammed into falsely approving lines of credit and loans. Call the impacted companies and explain the situation. Then, craft a detailed letter and send it to the appropriate contact person along with the FTC complaint and police report. It may be prudent to use certified mail when sending these documents.
Step 4: Secure Your Online Accounts
Hackers are relentless when it comes to identity theft. They can breach cellphones and electronic devices to steal Social Security numbers, credit card accounts, and wide-reaching personal information. Maximizing the cybersecurity measures that protect online accounts and wallets is crucial.
Consider using multi-factor authentication to protect financial accounts. Update your passwords regularly, and always use at least one capital letter, symbol, and number. Strong passwords never include things like “1,2,3” or are easily guessed.
Step 5: Monitor Your Credit Reports and Accounts
An identity theft recovery process involves erasing the paper trail left by fraudsters. You will be tasked with closing out accounts opened by unauthorized individuals in your name. Undoing this damage may take some time and patience because for-profit corporations don’t like to suffer losses, and no one relishes the thought of getting scammed.
Having companies correct their misinformation is only half the battle. Ask them to send their corrections to the credit bureaus to ensure it is officially updated. Circle back and make sure your credit report has been corrected. One caveat to keep in mind is that identity thieves may try again. And, hackers often sell personal identity information on the Dark Web. Continue to monitor your credit for unusual activity going forward.
Step 6: Consider Adding an Extended Fraud Alert or Credit Freeze
Credit freezes are excellent short-term deterrents that prevent scammers from opening new accounts or applying for loans. The downside is that they are a nuisance for victims who apply for automobile loans, HELOCs, credit cards, and other lending opportunities because the freeze prevents any credit from being pulled and loans being issued. At some point, releasing the credit freeze will ease the burden on the victim who is trying to regain their financial footing.
Not knowing whether someone will try to strike again can be a scary thought. Fortunately, fraud alerts serve as a similar protection. Fraud alerts send you a notification when unusual activity occurs, or a lending application is filed. People who have been victimized by identity theft crimes can secure an extended fraud alert lasting upwards of seven years. The protection is also available for members of the military on active duty.
How Long Does it Take to Recover from Identity Theft?
How long identity theft recovery takes largely depends on what types of accounts were used, as well as the speed and decisiveness of your actions. Once you have copies of the FTC complaint and police reports, those documents are often enough to persuade most companies to undo the damage. Organizations that are not as helpful may require you to persuade the credit bureaus to remove the blemishes.
As long as you are methodical, determined, and polite, identity theft is a bump in the road that teaches a valuable lesson about protecting personal information.
Allegiance Has Resources to Help
Allegiance is committed to helping our members protect their personal identity information. One of the best ways to keep identity theft at bay is to monitor your accounts inside Allegiance online banking and the mobile app. You can set up transaction alerts and monitor your credit report daily, for free.