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• Lend your credit card(s) to anyone.
• Leave credit cards or receipts lying around...this can be an invitation to thieves who can use your card just by knowing your account number and expiration.
• Sign a blank receipt. When you sign a receipt, draw a line through any blank spaces above the total.
• Write your account number on a postcard or the outside of an envelope.
• Give out your account number over the phone unless you know you're dealing with a reputable company and are positive that they're trustworthy. If you have questions about a company, check it out with your local consumer protection office or Better Business Bureau.
WHAT TO DO:
If you’re a victim of identity theft make sure to contact your financial institutions and the 3 main credit bureaus listed below. We recommend following your phone call with dated letters for your confirmation and records.
Equifax—Fraud Hotline
1-800-525-6285, then write: P.O. Box 740241, Atlanta, GA 30374
Experian—Fraud Hotline
1-888-EXPERIAN (397-3742), then write: P.O. Box 9532, Allen, TX 75013
TransUnion—Fraud Hotline
1-800-680-7289, then write: Fraud Victim Assistance Division, P.O. Box 6790, Fullerton, CA 92834
Reporting Losses and Fraud
If you lose your credit or charge cards or if you realize they've been lost or stolen, immediately call the issuer(s). Many companies have toll-free numbers and 24-hour service to deal with such emergencies. By law, once you report the loss or theft, you have no further responsibility for unauthorized charges. In any event, your maximum liability under federal law is $50 per card. If you suspect fraud, you may be asked to sign a statement under oath that you did not make the purchase(s) in question.
Avoiding Scams
Turning to a business that offers help in solving debt problems may seem like a reasonable solution when your bills become unmanageable. Be cautious. Before you do business with any company, check it out with your local consumer protection agency or the Better Business Bureau in the company's location.
Ads Promising Debt Relief May Be Offering Bankruptcy: Consumer debt is at an all-time high. What's more, a record number of consumers-nearly 1.5 million in 2001-filed for bankruptcy. Whether your debt dilemma is the result of an illness, unemployment, or overspending, it can seem overwhelming. In your effort to get solvent, be on the alert for advertisements that offer seemingly quick fixes. While the ads pitch the promise of debt relief, they rarely say relief may be bankruptcy. And although bankruptcy is one option to deal with financial problems, it's generally considered the option of last resort. The reason: it has a long-term negative impact on your creditworthiness. A bankruptcy stays on your credit report for 10 years, and can hinder your ability to get credit, a job, insurance, or even a place to live.
Read between the lines when faced with ads in newspapers, magazines, or even telephone directories that say:
"Consolidate your bills into one monthly payment without borrowing"
"STOP credit harassment, foreclosures, repossessions, tax levies and garnishments"
"Keep Your Property"
"Wipe out your debts! Consolidate your bills! How? By using the protection and assistance provided by federal law. For once, let the law work for you!"
You'll find out later that such phrases often involve bankruptcy proceedings, which can hurt your credit and cost you attorneys' fees.
Advance-Fee Loan Scams: These scams often target consumers with credit problems or consumers who have difficulty getting credit. In exchange for an up-front fee, these companies guarantee that applicants will get the credit they want-usually a credit card or a personal loan. The up-front fee may range from $100 to several hundred dollars. Resist the temptation to follow up on advance-fee loan guarantees. They may be illegal. Many legitimate creditors offer extensions of credit, such as credit cards, loans, and mortgages, through telemarketing and require an application fee or appraisal fee in advance. But legitimate creditors never guarantee in advance that you'll get the loan. Under the federal Telemarketing Sales Rule, a seller or telemarketer who guarantees or represents a high likelihood of your getting a loan or some other extension of credit may not ask for or receive payment until you've received the loan.
Recognizing an Advance-Fee Loan Scam: There are many fraudulent loan brokers and other individuals misrepresenting the availability of credit and credit terms. One of their favorite strategies is the "advance-fee" loan scam. That's where they claim to guarantee that they can get a loan or other type of credit for you-but you must pay a fee before you apply. Ads for advance-fee loans often appear in the classified ad section of local and national newspapers and magazines. They also may appear in mailings, radio spots, and on local cable stations. Often, these ads feature "900" numbers, which result in charges on your phone bill. In addition, these companies often use delivery systems other than the U.S. Postal Service, such as overnight or courier services, to avoid detection and prosecution by postal authorities.
Don't confuse a legitimate credit offer with an advance-fee loan scam. An offer for credit from a bank, savings and loan, or mortgage broker generally requires your verbal or written acceptance of the loan or credit offer. The offer usually is subject to a check of your credit report after you apply to make sure you meet their credit standards. You are usually not required to pay a fee in order to get the credit. Be suspicious of anyone who calls you on the phone and says they can guarantee you will get a loan if you pay in advance. Hang up. It's against the law.
Protecting Yourself: Here are some points to keep in mind before you respond to ads that promise easy credit, regardless of your credit history: Most legitimate lenders will not "guarantee" that you will get a loan or a credit card before you apply, especially if you have bad credit, or a bankruptcy. It is an accepted and common practice for reputable lenders to require payment for a credit report or appraisal. You also may have to pay a processing or application fee. Never give your credit card account number, bank account information, or Social Security number out over the telephone unless you are familiar with the company and know why the information is necessary.
Credit Repair Scams
You see the ads in newspapers, on TV, and on the Internet. You hear them on the radio. You get fliers in the mail. You may even get calls from telemarketers offering credit repair services. They all make the same claims:
"Credit problems? No problem!"
"We can erase your bad credit-100% guaranteed."
"Create a new credit identity-legally."
"We can remove bankruptcies, judgments, liens, and bad loans from your credit file forever!"
Do yourself a favor and save some money too. Don't believe these statements. Only time, a conscientious effort, and a plan for repaying your debt will improve your credit report.
The Scam: Every day, companies nationwide appeal to consumers with poor credit histories. They promise, for a fee, to clean up your credit report so you can get a car loan, a home mortgage, insurance, or even a job. The truth is, they can't deliver. After you pay them hundreds or thousands of dollars in up-front fees, these companies do nothing to improve your credit report; many simply vanish with your money.
The Warning Signs: If you decide to respond to a credit repair offer, beware of companies that:
• want you to pay for credit repair services before any services are provided;
• do not tell you your legal rights and what you can do-yourself-for free;
• recommend that you not contact a credit bureau directly;
• suggest that you try to invent a "new" credit report by applying for an Employer Identification Number to use instead of your Social Security number; or
• advise you to dispute all information in your credit report or take any action that seems illegal, such as creating a new credit identity. If you follow illegal advice and commit fraud, you may be subject to prosecution.
You could be charged and prosecuted for mail or wire fraud if you use the mail or telephone to apply for credit and provide false information. It's a federal crime to make false statements on a loan or credit application, to misrepresent your Social Security number, and to obtain an Employer Identification Number from the Internal Revenue Service under false pretenses.
The Credit Repair Organizations Act: By law, credit repair organizations must give you a copy of the "Consumer Credit File Rights Under State and Federal Law" before you sign a contract. They also must give you a written contract that spells out your rights and obligations. Read these documents before signing the contract. The law contains specific consumer protections. For example, a credit repair company cannot:
• make false claims about their services;
• charge you until they have completed the promised services; or
• perform any services until they have your signature on a written contract and have completed a three-day waiting period. During this time, you can cancel the contract without paying any fees.
Your contract must specify:
• the payment for services, including their total cost;
• a detailed description of the services to be performed;
• how long it will take to achieve the results;
• any guarantees they offer; and
• the company's name and business address.
If you've had a problem with any of the scams described here, contact your local consumer protection agency, state Attorney General (AG), or Better Business Bureau. Many AGs have toll-free consumer hotlines. Check with your local directory assistance.
For More Information:
The Federal Trade Commission enforces a number of credit laws and provides consumers with free information about them:
• The Equal Credit Opportunity Act prohibits the denial of credit because of your sex, race, marital status, religion, national origin, age, or because you receive public assistance.
• The Fair Credit Reporting Act gives you the right to learn what information is being distributed about you by credit reporting agencies.
• The Truth in Lending Act requires lenders to give you written disclosures of the cost of credit and terms of repayment before you enter into a credit transaction.
• The Fair Credit Billing Act establishes procedures for resolving billing errors on your credit card accounts.
• The Fair Debt Collection Practices Act prohibits debt collectors from using unfair or deceptive practices to collect overdue bills that your creditor has forwarded for collection.
Scammers Impersonate Legitimate Lenders: Promise A Loan for a Fee; Then Take the Money and Flee
Advance-fee loan sharks are preying on unwary consumers, taking their money for the promise of a loan or credit, and leaving them in hot water. The scam artists often impersonate legitimate lenders to entice consumers into falling for their bogus offer. According to law enforcement agencies in the U.S. and Canada, ads and promotions for advance-fee loans suggest-or even "guarantee"-that there's a high likelihood that a loan will be approved, regardless of the applicant's credit history. But to take advantage of the offer, the consumer has to pay a fee. The catch? The scam artist takes off with your fee, and the loan never materializes.
Many advance-fee loans are promoted in the classified sections of daily and weekly newspapers and magazines. Often, the ads feature toll-free 800, 866, or 877 numbers, or area codes from Canada, such as 416, 647, 905, or 705. The loans also are promoted through direct mail, radio, and cable TV spots. The fact that an ad is in a legitimate media outlet-like the local newspaper or radio station-doesn't guarantee that the company placing it is trustworthy.
Legitimate offers of credit do not require an up-front payment. Although legitimate lenders may charge application, appraisal, or credit report fees, the fees generally are taken from the amount borrowed. And the fees usually are paid to the lender or broker after the loan is approved. Legitimate lenders may guarantee firm offers of credit to "credit-worthy" consumers, but first, they evaluate the consumer's creditworthiness and confirm the information in the application. Canadian law enforcers caution that it is highly unlikely that legitimate Canadian lenders would take a risk on U.S. citizens whose credit problems preclude them from getting a loan in the U.S.
Often, advance-fee loan sharks claim that their fees will go to a third party for credit insurance or a related service. Sometimes, they even fax materials using stolen or forged logos and letterheads from legitimate companies. The materials are fakes, according to enforcement officials, and the contracts the scam artists ask consumers to sign are worthless. Adding insult to injury, some scammers have used the information they collect from consumers to commit identity theft.
Often, advance-fee loan scammers direct applicants to send the fees via Western Union money transfers payable to an individual, rather than a business. They ask applicants to use a "password code" with their Western Union payment, which allows the scammers to hide their identity.
U.S. and Canadian law enforcers say consumers can avoid being taken by advance-fee loan sharks. Here's how:
• Don't pay for the promise of a loan. It's illegal for companies doing business by phone in the U.S. to promise you a loan and ask you to pay for it before they deliver. Requiring advance fees for loans also is illegal in Canada.
• Ignore any ad-or hang up on any caller-that guarantees a loan in exchange for a fee in advance.
• Remember that legitimate lenders never guarantee or say that you will receive a loan before you apply, or before they have checked out your credit status or contacted your references, especially if you have bad credit or no credit record.
• Don't give your credit card, bank account, or Social Security number on the telephone, by fax, or via the Internet unless you are familiar with the company and know why the information is necessary.
• Don't make a payment to an individual for a loan; no legitimate lending organization would make such a request.
• Don't wire money or send money orders for a loan through Western Union or similar companies. You have little recourse if there's a problem with a wire transaction. Legitimate lenders don't pressure you to wire funds.
• If you are not absolutely sure who you are dealing with, get the company's number in the phone book or from directory assistance, and call it to make sure you're dealing with the company you think you are. Some scam artists have pretended to be the Better Business Bureau or another legitimate organization.
• Check out questionable ads by calling Project Phonebusters in Canada toll-free at 1-888-495-8501. If you live in the U.S. and think you've been a victim of an advance-fee loan scam, report it to the FTC online at www.ftc.gov or by phone, toll-free, at 1-877-FTC-HELP (1-877-382-4357).
Finding Low-Cost Help for Credit Problems
It's a good idea to try to solve your debt problems with your creditors as soon as you realize you won't be able to make your payments. If you can't resolve your credit problems yourself or need additional help, you may want to contact a credit counseling service. There are nonprofit organizations in every state that counsel and educate individuals and families on debt problems, budgeting and using credit wisely. There is little or no cost for these services. Universities, military bases, credit unions, and housing authorities also may offer low- or no-cost credit counseling programs. Check the white pages of your telephone directory for a service near you.
The Toronto Strategic Partnership is a group of law enforcement agencies in the U.S. and Canada that works together to prosecute cross border fraud. Formal members include the Toronto Police Service, the Competition Bureau Canada, the Ontario Ministry of Consumer and Business Services, the Ontario Provincial Police, the U.S. Federal Trade Commission and the U.S. Postal Inspection Service. Other partners include the Ohio Attorney General's Office, the Royal Canadian Mounted Police, and the Police Services of York, Durham and Peel in Ontario.
Credit, ATM and Debit Cards: What to do if They're Lost or Stolen
Many people find it easy and convenient to use credit cards and ATM or debit cards. The Fair Credit Billing Act (FCBA) and the Electronic Fund Transfer Act (EFTA) offer procedures for you to use if your cards are lost or stolen.
Limiting Your Financial Loss: Report the loss or theft of your credit cards and your ATM or debit cards to the card issuers as quickly as possible. Many companies have toll-free numbers and 24-hour service to deal with such emergencies. It's a good idea to follow up your phone calls with a letter. Include your account number, when you noticed your card was missing, and the date you first reported the loss. You also may want to check your homeowner's insurance policy to see if it covers your liability for card thefts. If not, some insurance companies will allow you to change your policy to include this protection.
Credit Card Loss or Fraudulent Charges (FCBA). Your maximum liability under federal law for unauthorized use of your credit card is $50. If you report the loss before your credit cards are used, the FCBA says the card issuer cannot hold you responsible for any unauthorized charges. If a thief uses your cards before you report them missing, the most you will owe for unauthorized charges is $50 per card. Also, if the loss involves your credit card number, but not the card itself, you have no liability for unauthorized use.
After the loss, review your billing statements carefully. If they show any unauthorized charges, it's best to send a letter to the card issuer describing each questionable charge. Again, tell the card issuer the date your card was lost or stolen, or when you first noticed unauthorized charges, and when you first reported the problem to them. Be sure to send the letter to the address provided for billing errors. Do not send it with a payment or to the address where you send your payments unless you are directed to do so.
ATM or Debit Card Loss or Fraudulent Transfers (EFTA). Your liability under federal law for unauthorized use of your ATM or debit card depends on how quickly you report the loss. If you report an ATM or debit card missing before it's used without your permission, the EFTA says the card issuer cannot hold you responsible for any unauthorized transfers. If unauthorized use occurs before you report it, your liability under federal law depends on how quickly you report the loss.
For example, if you report the loss within two business days after you realize your card is missing, you will not be responsible for more than $50 for unauthorized use. However, if you don't report the loss within two business days after you discover the loss, you could lose up to $500 because of an unauthorized transfer. You also risk unlimited loss if you fail to report an unauthorized transfer within 60 days after your bank statement containing unauthorized use is mailed to you. That means you could lose all the money in your bank account and the unused portion of your line of credit established for overdrafts. However, for unauthorized transfers involving only your debit card number (not the loss of the card), you are liable only for transfers that occur after 60 days following the mailing of your bank statement containing the unauthorized use and before you report the loss.
If unauthorized transfers show up on your bank statement, report them to the card issuer as quickly as possible. Once you've reported the loss of your ATM or debit card, you cannot be held liable for additional unauthorized transfers that occur after that time.
Protecting Your Cards: The best protections against card fraud are to know where your cards are at all times and to keep them secure. For protection of ATM and debit cards that involve a Personal Identification Number (PIN), keep your PIN a secret. Don't use your address, birthdate, phone or Social Security number as the PIN and do memorize the number.
The following suggestions may help you protect your credit card and your ATM or debit card accounts.
For Credit and ATM or Debit Cards:
• Be cautious about disclosing your account number over the phone unless you know you're dealing with a reputable company.
• Never put your account number on the outside of an envelope or on a postcard.
• Draw a line through blank spaces on charge or debit slips above the total so the amount cannot be changed.
• Don't sign a blank charge or debit slip.
• Tear up carbons and save your receipts to check against your monthly statements.
• Cut up old cards-cutting through the account number-before disposing of them.
• Open monthly statements promptly and compare them with your receipts. Report mistakes or discrepancies as soon as possible to the special address listed on your statement for inquiries. Under the FCBA (credit cards) and the EFTA (ATM or debit cards), the card issuer must investigate errors reported to them within 60 days of the date your statement was mailed to you.
• Keep a record-in a safe place separate from your cards-of your account numbers, expiration dates, and the telephone numbers of each card issuer so you can report a loss quickly.
• Carry only those cards that you anticipate you'll need.
For ATM or debit cards:
• Don't carry your PIN in your wallet or purse or write it on your ATM or debit card.
• Never write your PIN on the outside of a deposit slip, an envelope, or other papers that could be easily lost or seen.
• Carefully check ATM or debit card transactions before you enter the PIN or before you sign the receipt; the funds for this item will be fairly quickly transferred out of your checking or other deposit account.
• Periodically check your account activity. This is particularly important if you bank online. Compare the current balance and recent withdrawals or transfers to those you've recorded, including your current ATM and debit card withdrawals and purchases and your recent checks. If you notice transactions you didn't make, or if your balance has dropped suddenly without activity by you, immediately report the problem to your card issuer. Someone may have co-opted your account information to commit fraud.
Buying a Registration Service: For an annual fee, companies will notify the issuers of your credit card and your ATM or debit card accounts if your card is lost or stolen. This service allows you to make only one phone call to report all card losses rather than calling individual issuers. Most services also will request replacement cards on your behalf. Purchasing a card registration service may be convenient, but it's not required. The FCBA and the EFTA give you the right to contact your card issuers directly in the event of a loss or suspected unauthorized use. If you decide to buy a registration service, compare offers. Carefully read the contract to determine the company's obligations and your liability. For example, will the company reimburse you if it fails to notify card issuers promptly once you've called in the loss to the service? If not, you could be liable for unauthorized charges or transfers.
For More Information: The following federal agencies are responsible for enforcing federal laws that govern credit card and ATM or debit card transactions. Questions concerning a particular card issuer should be directed to the enforcement agency responsible for that issuer.
Board of Governors of the Federal Reserve System
Regulates state-chartered banks that are members of the Federal Reserve System, bank holding companies, and branches of foreign banks:
Division of Consumer and Community Affairs, Stop 801
20th and C Streets, NW
Washington, DC 20551
202-452-3693
www.federalreserve.gov
Federal Deposit Insurance Corporation
Regulates state-chartered banks that are not members of the Federal Reserve System:
Division of Compliance and Consumer Affairs
550 17th Street, NW
Washington, DC 20429
877-ASK-FDIC (275-3342) toll-free
www.fdic.gov
National Credit Union Administration
Regulates federally chartered credit unions:
Office of Public and Congressional Affairs
1775 Duke Street
Alexandria, VA 22314-3428
703-518-6330
www.ncua.gov
Office of the Comptroller of the Currency
Regulates banks with "national" in the name or "N.A." after the name:
Office of the Ombudsman
Customer Assistance Group
1301 McKinney Street, Suite 3710
Houston, TX 77010
800-613-6743 toll-free
www.occ.treas.gov
Office of Thrift Supervision
Regulates federal savings and loan associations and federal savings banks:
Consumer Programs
1700 G Street, NW
Washington, DC 20552
800-842-6929 toll-free
www.ots.treas.gov
Federal Trade Commission
Regulates other credit card and debit card issuers:
Consumer Response Center
600 Pennsylvania Avenue, NW
Washington, DC 20580
877-FTC-HELP (382-4357) toll-free
www.ftc.gov
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 civil and criminal law enforcement agencies in the U.S. and abroad.
Credit Card Loss Protection Offers: Many are a rip-off
"I got a call from a woman who said I need credit card loss protection insurance. I thought there was a law that limited my liability to $50 for unauthorized charges. But she said the law had changed and that now, people are liable for all unauthorized charges on their account. Is that true?"
Don't buy the pitch-and don't buy the "loss protection" insurance. Telephone scam artists are lying to get people to buy worthless credit card loss protection and insurance programs. If you didn't authorize a charge, don't pay it. Follow your credit card issuer's procedures for disputing charges you haven't authorized. According to the Federal Trade Commission, your liability for unauthorized charges is limited to $50.
The FTC says worthless credit card loss protection offers are popular among fraudulent promoters who are trying to exploit consumers' uncertainty. As a result, the agency is cautioning consumers to avoid doing business with callers who claim that:
• you're liable for more than $50 in unauthorized charges on your credit card account;
• you need credit card loss protection because computer hackers can access your credit card number and charge thousands of dollars to your account;
• a computer bug could make it easy for thieves to place unauthorized charges on your credit card account; and
• they're from "the security department" and want to activate the protection feature on your credit card.
The FTC advises consumers not to give out personal information-including their credit card or bank account numbers-over the phone or online unless they are familiar with the business that's asking for it. Scam artists can use your personal information to commit fraud, such as identity theft. That's where someone uses some piece of your personal information, such as your credit card account number, Social Security number, mother's maiden name, or birth date, without your knowledge or permission to commit fraud or theft. An all-too-common example is when an identity thief uses your personal information to open a credit card account in your name.
For More Information: Contact the fraud departments of any one of the three major credit bureaus to place a fraud alert on your credit file. The fraud alert requests creditors to contact you before opening any new accounts or making any changes to your existing accounts. As soon as the credit bureau confirms your fraud alert, the other two credit bureaus will be automatically notified to place fraud alerts, and all three credit reports will be sent to you free of charge.
Close the accounts that you know or believe have been tampered with or opened fraudulently. Use the ID Theft Affidavit when disputing new unauthorized accounts.
File a police report. Get a copy of the report to submit to your creditors and others that may require proof of the crime.
File your complaint with the FTC. They maintain a database of identity theft cases used by law enforcement agencies for investigations. Filing a complaint also helps us learn more about identity theft and the problems victims are having so that we can better assist you.
Introduction
The 1990's spawned a new variety of crooks called identity thieves. Their stock in trade? Your everyday transactions, which usually reveal bits of your personal information: your bank and credit card account numbers; your income; your Social Security number (SSN); or your name, address, and phone numbers. An identity thief obtains some piece of your sensitive information and uses it without your knowledge to commit fraud or theft.
Identity theft is a serious crime. People whose identities have been stolen can spend months or years-and their hard-earned money-cleaning up the mess the thieves have made of their good name and credit record. Some victims have lost job opportunities, been refused loans for education, housing or cars, or even been arrested for crimes they didn't commit.
Can you prevent identity theft from occurring? As with any crime, you cannot completely control whether you will become a victim. But, according to the Federal Trade Commission (FTC), you can minimize your risk by managing your personal information cautiously and with heightened sensitivity.
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 diving."
• 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 home.
• 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 report.
• 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 your name.
• 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 Theft?
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 not apply;
• denial of credit for no apparent reason; or
• 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 and prudence.
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 as well.
Everyday Diligence
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 using the 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 another number.
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 at work.
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 during transmission.
• 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 questions:
• 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 you?
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.
1. 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 30374-0241
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.
2. 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 service providers.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 those transactions:
• For new unauthorized accounts, ask if the company accepts the ID Theft Affidavit (available at www.ftc.gov/bcp/conline/pubs/credit/affidavit.pdf). 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 forms.
• 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.
Checks
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 927-0188
• Certegy, Inc.-1-800-437-5120
• International Check Services-1-800-631-9656
• Call SCAN (1-800-262-7771) to find out if the identity thief has been passing bad checks in your name.
3. File a report with your local police or the police in the community where the identity theft took place.
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.
4. 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 the FTC's Privacy Policy, visit www.consumer.gov/idtheft.
All Gold Credit Cards are not really Gold
If you're looking for credit, be wary of some 'gold' or 'platinum' card offers promising to get you credit cards or improve your credit rating. While sounding like general-purpose credit cards, some 'gold' or 'platinum' cards permit you to buy merchandise only from specialized catalogues. Marketers of these credit cards often promise that by participating in their credit programs, you will be able to get major credit cards (such as an unsecured Visa or MasterCard), lines of credit from national specialty and department stores, better credit reports, and other financial benefits.
Rarely, however, can you improve your credit rating or get major credit cards by buying 'gold' or 'platinum' credit cards. Often the only major credit card you might get is a secured credit card that requires a substantial security deposit with a bank. In addition, many of these credit-card offerors do not report to credit bureaus as they promise, and their cards seldom help secure lines of credit with other creditors.
Such 'gold' and 'platinum' credit-card offers usually are promoted through television or newspaper advertisements, direct mail, or telephone solicitations using automatic dialing machines and recorded messages. People who live in lower-income areas often are the target of these sales pitches.
Watch Out For...
Be wary of 'gold' and 'platinum' card promotions that:
Charge upfront fees, without saying there may be additional costs.
Some 'gold' or 'platinum' card promoters charge $50 or more for their cards. Only after you agree to pay this fee are you told there's an additional fee, sometimes $30 or more, to get the merchandise catalogues. Yet, these catalogues are the only places you can use the cards.
Use '900' or '976' telephone exchanges.
Ads for ' gold' and 'platinum' cards may urge you to call numbers with '900' or '976' exchanges for more information. You pay for phone calls with these prefixes-even if you never get the 'gold' or 'platinum' card. The cost for these calls can be high.
Misrepresent prices and payments for merchandise.
You're not allowed to charge the total amount when you buy merchandise from 'gold' or 'platinum' card catalogues. Instead, you often must pay a cash deposit on each item you charge-an amount usually equal to what the company paid for the product. Only after you pay your deposit can you charge the balance. Also, catalogue prices can be much higher than discount store prices.
Promise to easily get you "better credit."
Marketers of 'gold' and 'platinum' cards often claim its easy to get major credit cards after using their cards for a few months. In fact, the only major cards you usually can get through these marketers are secured. A secured card requires you to open and maintain a savings account as security for your line of credit. The required deposit may range from a few hundred to several thousand dollars. Your credit line is a percentage of the deposit, typically 50 to 100 percent.
How To Protect Yourself
Follow these precautions to avoid becoming a victim of 'gold' and 'platinum' card scams:
Think twice about any offer to get "easy credit."
Be skeptical of promises to erase bad credit or to secure major credit cards regardless of your past credit problems. There are no "easy" solutions to a poor credit rating that's based on accurate information. Only time and good credit habits will restore your credit worthiness.
Investigate an offer before enrolling.
Contact your local Better Business Bureau, (www.bbb.com) consumer protection agency, or state Attorney General's office to see if any complaints have been filed against a particular promoter of 'gold' or 'platinum' cards.
If a marketer promises that a card is accepted at certain retail chains, verify it with the stores.
If a marketer assures you that reliable information about you will be reported to credit bureaus, call the bureaus to confirm that the merchant is a member. Unless 'gold' or 'platinum' card merchants are subscribers to credit bureaus, they won't be able to report information about your credit experience.
Be cautious about calling '900' or '976' telephone numbers.
Calls to numbers with '900' or '976' prefixes cost money. Don't confuse these exchanges with toll-free '800' numbers. If you dial a pay-per-call number mistakenly, contact your local phone company immediately. They may be able to remove the charge from your bill.
We recommend reading the related topics in this section to increase your knowledge of low interest credit cards, secured credit cards, student credit cards and personal finance matters.
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