8 Warning Signs of Identity Theft (and How to Fight Back)
Data hacks can leave you vulnerable to cybercriminals. Laura covers 8 warning signs to watch for and how to fight back if you become a victim of identity theft. Plus, she answers questions on a variety of topics including protecting kids’ credit, signing up for credit monitoring, and placing security alerts on your credit files.
Millions of Americans have been impacted by the Equifax data breach that was announced on September 7, 2017. Since then, they've made key personnel changes and say they’re still investigating the incident and working closely with the FBI.
Whether your personal information was stolen or not, there are important steps you can take to avoid becoming a victim of identity theft. Be sure to read or listen to my previous post, Equifax Data Breach: 5 Steps to Protect Your Personal Finances.
Since the breach, I’ve received a steady stream of questions from Money Girl readers and podcast listeners about protecting their finances. In this article, I’ll review eight major warning signs of identity theft and how to fight back if you do become a victim.
Plus, I'll answer a variety of questions about topics including protecting your kids’ credit, signing up for credit monitoring, and where to place security alerts on your credit files.
8 Warning Signs of Identity Theft
- Incorrect information on your credit reports.
- Charges on your credit cards that you didn't make.
- Charges or withdrawals from a financial instituation that you didn't make.
- Calls from collectors about debts that aren't yours.
- Calls from collectors about medical bills that aren't yours.
- Missing bills and statements from your snail mail.
- Notice about maxed out government benefits.
- Your income tax refund never arrives.
Here are details about each of these warning signs with tips to fight back.
1. Incorrect information on your credit reports.
Reviewing your credit reports on a regular basis is one of the best ways to nip fraud in the bud. It isn’t foolproof, because there are types of identity theft that don’t involve your credit, which I’ll cover in a moment.
However, if you see any incorrect information, such as a wrong address, accounts you didn’t open, inquiries from companies you don’t recognize, or incorrect balances on accounts, they are strong signs that your accounts or identity has been hijacked.
Fight back: Dispute the errors with each of the three nationwide credit bureaus (Equifax, Experian, and TransUnion) and report fraud to the Federal Trade Commission (FTC). Also contact creditors that have incorrect information about you to dispute it.
2. Charges on your credit cards that you didn’t make.
Even a small credit card charge that isn’t yours means that a fraudster is using your card number. They often make one or more small charges to test whether you notice before they rack up more expensive purchases.
Fight back: Contact your card issuer right away and report any unauthorized charges so they can discontinue the old card number and give you a new one. This doesn’t close your account or make you lose any payment history. They simply change the number and send you a new card in the mail.
Fortunately, the Fair Credit Billing Act (FCBA) says that you’re responsible for no more than $50 of fraudulent charges on a credit card. And if you report a lost or stolen card before unauthorized charges are made, you don’t owe anything. After speaking with your card issuer check your credit reports to make sure there aren’t new accounts that you don’t recognize.
3. Charges or withdrawals from a financial institution that you didn’t make.
Any transactions you don’t recognize on your checking, savings, or investing accounts means someone has access and could drain them by making purchases, withdrawals, or cashing out investments.
Fight back: Contact your financial institution to report the unauthorized use and change your account passwords. They may freeze your accounts while they make an investigation. Also check your credit reports for any other suspicious activity.
4. Calls from collectors about debts that aren’t yours.
Past due amounts in your name means a criminal has used your information to borrow money—such as getting a mortgage, car loan, personal loan, or credit card—and then not paid it back.
Fight back: Get all the information you can from the collector, such as his or her name, the company name and address, and a phone number. Request a validation notice that outlines the details about the debt in question.
According to the Fair Debt Collection Practices Act you’re entitled to receive a validation notice within five days of being contacted by a collector, which lists the debt details, including how to dispute it. You can also send a debt verification request to a debt collector within 30 days of initial contact. Then check your credit reports.