Recovering from Identity Theft

We all know that identity theft is on the rise, and we also know that it can be devastating to the financial life of the victim. Recovering from having your identity, and your good name, stolen, can take a significant amount of work, and no small outlay of cash.

In fact, a recent survey of identity theft victims revealed that on average they spent a staggering 175 hours and $800 to get their good names back. While it is best to avoid identity theft in the first place, if you find yourself a victim there are a number of things you can do to recover your identity and your good credit.

  • Report the identity theft immediately. If you suspect you have been a victim of identity theft or fraud, it is essential to notify all three major credit reporting agencies – Experian, Equifax and TransUnion, immediately. When contacting the agencies, be sure to ask that a “fraud alert” be placed in your file. It is also important to ask that no new lines of credit be granted unless your express approval is obtained. The credit reporting agency will ask that the incident or incidents be recorded in writing, and that copies of all documentation (police reports, correspondence, etc.) be provided as well.
  • Be sure to close any accounts on which there has been fraud. Accounts that have been fraudulently accessed, or opened without your knowledge, should be closed immediately. In addition, it is important to contact the security department of the creditor or bank at which the account was held.
  • Document the identity theft by filing a police report. It is also important to get a copy of the police report, as this documentation will be important going forward.
  • The Federal Trade Commission (FTC) provides consumers with an identity theft affidavit which can help organize and report any complaints. All three of the major credit reporting agency, and most large banks, will accept this standard form as a notice that identity theft has occurred. If the identity theft involved the compromise of your Social Security number, be sure to notify the Social Security Administration of the incident.

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