What is Identity Theft and How Do I Spot It?

In 2020, identity theft effected 4.7 million Americans, resulting in over four billion dollars of losses. However, due to COVID-19, this number drastically increased from 2019 by almost 45%. With fraud and identity theft increasing at such a fast pace, it is essential to understand what identity theft is, how it can happen, and what to do if it happens to you.

What is Identity Theft?

Identity theft is when someone takes your personal information and uses it without your permission. The most common ways this can happen is the thief could apply for a credit card or a bank loan, open or close bank accounts, or withdraw money from your existing accounts. However, a thief can also file tax returns with your information, apply for medical services, and even apply for unemployment benefits.

A thief can do all of this by simply gaining the personal information needed for these types of accounts, including your full name, birthdate, social security number, address, or PIN. It is important to carefully monitor this information in both physical and digital forms.

However, sometimes this personal information can be outside of your control due to data breaches. A data breach is a security incident in which cybercriminals hack into a company’s database and steal company and customer information. These have unfortunately become common, and can cause trouble for hundreds of thousands of consumers in one breach.

How to Spot Identity Theft

There are many signs that your identity may have been stolen. Some of the most common warning signs of identity theft are bills for items you did not buy, debt collectors calling for accounts you did not open and are unaware of, and being denied for loan applications. Other signs include checks bouncing, missing bills, utilities being cut off, or the inability to file taxes.

It is important to remember that anyone could be the victim of identity theft. Even children and the elderly are at risk. Pay close attention to any accounts linked to your child—many people who have had their identity stolen as a child do not realize it until they attempt to open legitimate accounts as adults. Elderly people are at a particularly high risk because they often have more doctors that they give personal information to. Having that information in more locations places elderly people at a higher risk of having their identity stolen.

What do you do When Your Identity Has Been Stolen?

If you believe you are a victim of identity theft, it is important to act fast. If not handled efficiently and correctly, identity thieves can quickly ruin your finances and damage your credit. First, contact your bank or credit card company to notify them of the theft. They can work with you to freeze action on your accounts, and prevent new accounts from being opened. Banks and other creditors are required to honor several federal statues designed to help protect consumers in situations of identity theft.

Next, you can contact the Federal Trade Commission (FTC) online or by phone. The FTC will gather details about the theft, create a plan for your recovery, and begin working with you to execute that plan.

Unfortunately, there are some situations where proving that you have been the victim of identity theft can be challenging. In others, banks and creditors are stubborn in honoring consumer protection statutes. In these cases, you may need to look for an lawyer to help support you.

When hiring a lawyer, it is essential that you find one that has experience in protecting consumers from identity theft and inaccurate reporting. A skilled consumer protection lawyer should also have experience with the federal statutes that protect consumers, such as the Electronic Funds transfer Act, the Fair Credit Billing Act, and the Truth in Lending Act.

Getting Help with Identity Theft

If you are experiencing identity theft but your banks or the FTC are not handling the issue correctly, it is time to find a lawyer. A skilled lawyer can diligently handle cases of identity theft and save you credit, return your finances, and restore your good name. The Financial Justice Initiative was founded by two successful consumer protection lawyers interested in educating people and holding companies accountable when they violate your rights. The firm has extensive experience in protecting the rights of consumers around the country. If you believe you may be the victim of identity theft, contact the Financial Justice Initiative for help.