What do you do if your identity is stolen? This is a question that many people have. No one is immune to identity theft. It can happen to anyone, and when it does, it feels like a nightmare.
According to a global security survey, at least 33% of Americans have been a victim of identity theft. This is a disturbing statistic, but there are things that you can do to protect yourself and your family.
We understand that it can be incredibly frustrating and time-consuming when your identity is stolen. You may feel like you're out of options, but there are still steps you can take to recover from the incident.
In this article, we've put together a step-by-step guide on what to do if your identity is stolen. By following these instructions, you can minimize the damage that's done and start to re-establish your identity.
In the end, we share a common misconception about an ID theft recovery step that you shouldn’t believe. So, stick with us and don’t leave any loophole that criminals can further exploit.
Of course, we have to remind you that every situation is different. However, you can use this as a guide on how to fix identity theft.
Step 1: Check your accounts for all traces of suspicious activity
You're probably here reading this because you're already convinced that you have been a victim of identity theft.
While some of you might suspect identity theft because you have received a notification from your bank or credit card company about suspicious activity.
One of the most common signs that your identity might have been stolen is if a credit card you've not used recently shows up on your credit report with charges you don't recognize.
Also, you might see new accounts that have been opened in your name or inquiries from companies you've not contacted.
So what's the first thing you should do if your identity is stolen?Â
The first step you need to take is to check all of your financial accounts for any suspicious activity. This includes your credit reports, bank account, credit card statements, and any other financial accounts you have.
You can request a free credit report from AnnualCreditReport.com. This website is the only official site where you can get your free credit report from the three major credit bureaus: Equifax, Experian, and TransUnion.
For your financial accounts, you can usually access most of these already through online banking.
Why is it important to check all of your accounts first?Â
It's very important to do a thorough sweep of all of your accounts because identity thieves will often use multiple methods to try and steal your money.
For example, they might open up a new credit card in your name and run up a large balance. Then, they might try to withdraw money from your bank account.
By checking all of your accounts, you can get a better idea of the extent of the damage that could have happened.
When checking your accounts, take note of any charges or activity that you don't recognize in the last three to six months. You'll need this information later when you contact your bank or credit card company and file a police report.
Step 2: Contact the companies involved to place a hold on your accounts
The next step is to make sure that the identity thieves can no longer access your accounts or open up new ones in your name.
The best way to do this is by calling the financial institutions directly involved and placing a hold or alert on your accounts.
For your credit cards, you'll want to contact the customer service number on the back of your card and tell them that you're a victim of identity theft. They will then cancel your card and issue you a new one with a new account number.
For your bank accounts, you'll want to contact your bank and inform them of the situation. They will usually put a hold on your account and may close it down if there is evidence of fraudulent activity. You might also want to consider getting a new debit card with a new account number.
At this point, your main goal is to FREEZE or CLOSE your account first to prevent further damage. You might be tempted to resolve the unauthorized charges first, but you should do this AFTER your account is secure.
If the identity theft took place through online access to your account, we highly recommend that you change your user ID and password for that account immediately.
Step 3: Contact the credit bureaus to place a fraud alert on your credit reports
When identity theft takes place, one of the most common ways it manifests is through fraudulent activity on your credit report. This could be in the form of new accounts being opened in your name, charges being made to existing accounts, or inquiries from companies you've not contacted.
These fraudulent transactions are not only a pain to deal with, but they can also damage your credit score. That's why it's important to take action as soon as possible and contact the credit bureaus to place a fraud alert on your credit reports.
A fraud alert will notify creditors that they should take extra steps to verify your identity before extending credit in your name.
You only need to contact one of the three major credit bureaus to place a fraud alert on your report. The one you contact will then inform the other two credit bureaus.
Once the fraud alert has been placed, you'll receive a letter from each credit bureau to confirm that they placed a fraud alert on your report.
- Equifax: 1-800-685-1111
- Experian: 1-888-397-3742
- TransUnion: 1-888-909-8872
Step 4: File a complaint to the Federal Trade Commission
Now that your accounts are secure, you need to file a complaint to the Federal Trade Commission or FTC.
To do this, you need to visit the FTC's one-stop shop for identity theft victims, which is identitytheft.gov. Alternatively, you can also call 1-877-438-4338.
When you visit the website or call the FTC hotline, a representative will walk you through the different steps you need to take to complete the complaint.
The FTC rep will also provide you with information on what to do depending on the specific identity theft situation you're in.
For example, if you're a victim of tax identity theft, you can find information on the identitytheft.gov website on how to contact the IRS and report fraud.
The information you provide to the FTC will be used to create an Identity Theft Report. This document will be used to help you recover your losses and fix any damage that has been done to your credit report.
Step 5: File a complaint to the local police station
Depending on the extent of the issue, you may choose to file a complaint with your local police.
Some people don't want to go through the hassle because you're thinking that the police will not catch the thieves anyway. It’s a common misconception. Getting a police report has its upsides.
Having a police report can help you when you're dealing with creditors and other companies. Some businesses may require a copy of the police report along with the FTC Identity Theft Report before they'll take your complaint seriously.
When the damage is quite extensive, a police report can also help support your case when you file for identity theft protection or claim insurance if you're eligible for any reimbursements.
To file a police report, you'll need to visit your local police station and provide them with as much information as possible about the identity theft.
You have to have your FTC Identity Theft Report with you, so make sure you bring a copy of the document. You also need to bring a photo ID issued by the government and other documentation to prove your identity, address, and information.
Step 6: Correct fraudulent charges and activity in your accounts
After reporting the identity theft to the FTC and police, the next step is to correct any fraudulent charges or activity in your accounts. This includes your credit cards, bank accounts, credit reports, and any other financial accounts that have been impacted.
The process of clearing up your accounts will differ depending on the type of account and the severity of the fraud.
For example, if someone has stolen your credit card and made unauthorized charges, you can simply call your credit card company to dispute the charges.
You can also request the credit bureaus to remove any fraudulent activity from your credit report.
This is important because if you don't, the fraudulent activity could stay on your report for up to seven years and impact your credit score.
In case of criminal identity theft, where someone has used your personal information to commit a crime, you'll need to take additional steps to clear your name and record.
This may involve working with the court system and providing them with proof that you're not the person who committed the crime.
When undertaking these actions, having a copy of your FTC Identity Theft Report and Police Report can speed up the process. Make sure you're also ready with all the relevant information and documentation to support your case.
Step 7: Refresh your accounts and get added protection
The last step is to ensure that your accounts are secure and that you have added protection against future identity theft. You don't want all your hard work to go to waste by becoming a victim again.
Start by reviewing all your accounts and changing any passwords that may have been compromised.
It's also a good idea to enroll in two-factor authentication or other security measures offered by your financial institution.
You should also consider monitoring your credit report and financial accounts regularly and signing up for an identity theft protection service.
Protect yourself from further damage after your identity is stolen
When you first suspect that your identity has been stolen, it's important to act quickly to minimize the damage. Instead of panicking, take a deep breath and focus on taking the necessary steps to recover from identity theft.
By following the steps above, you can limit the fallout from identity theft and take back control of your finances and personal life. Of course, even after taking all these measures, there's always a risk that your information could be compromised again in the future. The best you can do is to stay vigilant and get an extra level of protection whenever possible.
Aidan has been writing about personal finance for over 6 years. Prior to this, he worked as a Corporate Finance Analyst where he specialized in Due Diligence, Company Valuations and more. He is a CFA charterholder.
