A Practical Guide to Recovering from Identity Theft
When you discover your identity has been stolen, your first instinct might be panic. It’s important to take a deep breath and follow a clear, systematic plan. The steps you take in the first 24 to 48 hours are crucial for containing the damage. This section provides that step-by-step plan.
Step 1: Immediate Damage Control
Your first priority is to stop the thief from doing more harm. This means contacting the fraud departments of any companies where you know fraudulent activity has occurred.
- Credit Card Fraud: If a fraudulent charge appears on your statement, call the issuer immediately using the number on the back of your card. Report the charge as fraudulent. They will likely close your existing account and issue you a new card with a new number.
- Bank Account Fraud: If you see unauthorized withdrawals or fraudulent checks on your bank account, contact your bank or credit union right away. Ask them to close the compromised account and open a new one. Change your PINs and online banking passwords.
- Other Fraudulent Accounts: If a thief opened a new utility, phone, or other type of account in your name, contact the service provider. Explain the situation, close the account, and ask for a letter confirming that the fraudulent account was not yours and that you are not liable for the charges.
Step 2: Place a Fraud Alert and a Credit Freeze
This is a critical step in preventing new fraudulent accounts from being opened in your name. You should do both.
First, place an initial fraud alert. You only need to contact one of the three major credit bureaus to do this. The one you contact is required by law to notify the other two. An initial alert lasts for one year and tells potential lenders to take extra steps to verify your identity before extending credit.
Second, and more importantly, place a credit freeze. A freeze offers the strongest level of protection. To learn how to place a freeze on your credit report, you must contact each of the three bureaus separately. A freeze locks down your credit file, preventing most third parties from accessing it. This makes it extremely difficult for a thief to open a new line of credit in your name.
- Equifax: (800) 685-1111 or online
- Experian: (888) 397-3742 or online
- TransUnion: (888) 909-8872 or online
Remember, placing a freeze is free. You will create an account and a PIN for each bureau, which you will need to use later if you want to temporarily “thaw” your credit to apply for a loan yourself.
Step 3: Report the Identity Theft to the FTC
This is perhaps the most important step in the official recovery process. Go to the Federal Trade Commission’s dedicated website: IdentityTheft.gov. This government site will guide you through creating a personalized recovery plan and an official Identity Theft Report.
The FTC Identity Theft Report is a legal document that serves as proof of the crime. You will need it to:
- Get fraudulent information removed from your credit report.
- Stop a company from collecting debts that resulted from identity theft.
- Place an extended fraud alert on your credit report.
- Get copies of documents and records related to the fraudulent transactions.
The website will ask you questions about what happened, and based on your answers, it will generate the report and provide you with pre-filled letters you can send to credit bureaus and businesses.
Step 4: File a Report with Your Local Police Department (Optional but Recommended)
In many cases, the FTC Identity Theft Report is sufficient. However, some businesses or creditors may still require a police report. Take your FTC report, a photo ID, proof of your address, and any other evidence of the theft to your local police station to file a report. Get a copy of the police report number and the report itself, as you may need it later.
Step 5: Address Specific Types of Identity Theft
Identity theft can take many forms. Once you have taken the initial containment steps, you may need to address specific issues depending on how your information was used.
What to do when your Social Security number is stolen:
This is one of the most serious forms of identity theft. If you know your Social Security number (SSN) has been compromised, you must act swiftly. The thief can use it to get a job, file for your tax refund, or apply for government benefits.
- Check your Social Security earnings record. You can do this by creating a free my Social Security account on the Social Security Administration’s website. Look for any wages from an employer you don’t recognize. Creating this account also prevents a thief from creating one in your name to divert your benefits.
- Report the fraud to the Social Security Administration (SSA). You can call their fraud hotline or report it to their Office of the Inspector General.
- Consider what else the thief can do with your SSN. Because your SSN is a master key to your identity, you must follow all the other steps in this guide, including freezing your credit and filing an FTC report.
If your information was used for tax fraud:
If you try to file your taxes and discover that someone has already filed a return using your SSN, you are a victim of tax identity theft. You should immediately file IRS Form 14039, the Identity Theft Affidavit. You will still need to file your legitimate tax return on paper and mail it to the IRS, along with an explanation. The IRS will investigate and, once resolved, may issue you a special Identity Protection PIN (IP PIN) to use for future tax filings to provide extra security.
If your information was used for medical fraud:
Medical identity theft occurs when someone uses your name or health insurance numbers to see a doctor, get prescription drugs, or file claims with your insurance provider. This can be dangerous, as it can result in incorrect information being added to your medical records.
- Request a copy of your medical records. Review them for any procedures, prescriptions, or doctor visits you don’t recognize.
- Notify your health insurer of the fraudulent activity.
- Ask for corrections. Under federal HIPAA law, you have the right to have incorrect information in your medical records corrected.
Step 6: Clean Up Your Credit Reports and Monitor Your Accounts
With your FTC report and police report in hand, it’s time to repair the damage. Send a letter to each of the three credit bureaus explaining which information on your report is fraudulent. Include a copy of your Identity Theft Report and ask them to block the fraudulent items. The bureaus have a legal obligation to investigate and remove the fraudulent information, usually within 30 days.
Continue to monitor your financial statements, bills, and credit reports for several months. Identity thieves may sell your information, and new fraudulent activity can pop up long after the initial incident. Setting up account alerts with your bank and credit card companies can help you spot suspicious activity immediately.
