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Identity Theft Basics


What is identity theft?

Identity theft is the act of stealing someone else's personal information (such as his or her name, date of birth, or social security number) to commit fraud.  In most cases, identity theft involves credit cards or other financial scams.

What might an identity thief do with my personal information?

  • Make unauthorized charges to your credit accounts.
  • Call your credit card issuer pretending to be you and change the mailing address on your credit card account.  Because your bills are being sent to the new address, you may not immediately realize there's a problem.
  • Open a new credit card account, using your name, date of birth, and Social Security Number.
  • Sign up for cellular or long distance telephone service in your name.
  • Open a bank account in your name and write bad checks on that account.
  • Work and file (or fail to file) tax returns using your Social Security Number.


Know Your Rights!

Under the Truth In Lending Act (TILA), you cannot be held responsible for charges to a credit card that you never requested or applied for and received.  And, for unauthorized charges to your existing accounts, the most you should ever have to pay is $50.


How does an identity thief obtain my personal information?

There are many ways that an identity thief can obtain your personal information.  Some of the most common include:

  • Stealing your wallet or purse.
  • Stealing your mail or rummaging through your trash to obtain bank and credit card statements, credit card offers, new checks, and tax information.
  • Completing a "change of address" form to divert your mail to a different address.
  • Recording your name and credit card information when you make purchases at a restaurant or shop, then using that information to make unauthorized purchases on your account.
  • Obtaining personal information directly from you by posing as a customer service representative from a company where you have an account and contacting you by phone or email to inform you about a problem with your account.  (This is also known as a "phishing scam.")
  • Sometimes, the thief might be someone close to you, such as a friend or family member. 

How can I protect myself from identity theft?

  • Don't give out your personal information unless it is necessary -- especially your Social Security Number.
  • Before giving out your personal information, find out how it will be used and whether it will be shared with others.
  • Keep track of your bills, and call the companies if they do not arrive on time.
  • Carry only the IDs and credit cards that you need.   Keep your Social Security card in a safe place, not in your wallet.
  • Keep records with personal information in a safe place.
  • When you throw out credit card receipts, credit card offers, and bank account statements, make sure that you tear them up.

What are some common signs of identity theft?

  • Your purse or wallet is stolen.
  • Strange charges appear on your credit card bill.
  • You apply for credit and are unexpectedly denied.
  • Your credit card company tells you that it is going to raise your rate because you have defaulted on other accounts, and you do not believe this is true.
  • You start to receive calls from debt collectors about unfamiliar accounts.
  • Your bank account is frozen because a creditor has obtained a default judgment against you on an unfamiliar account.

What should I do if my wallet or purse was lost or stolen?

  • If your purse or wallet was stolen, report it to the police immediately.  Get a copy of your police report in case your bank, credit card company, or insurance company needs proof of the crime.
  • Notify all your creditors of the theft.  Get new credit cards with new account numbers.
  • Notify your bank of the theft.  Get a new ATM card with new card number and Personal Identification Number (PIN).
  • Call the credit reporting agencies and ask them to put a "fraud alert" on your account.
  • Check your credit reports for fraud, and check a few months later to make sure no new accounts have been opened and no unauthorized transactions have taken place.
  • Report your missing driver's license to the Department of Motor Vehicles (DMV).
  • If your cell phone was stolen, report the theft to your cell phone service provider.
  • If your keys were taken, consider changing the locks on your home, especially if your ID with your address was also stolen.

What should I do if a company notifies me that my personal information has been compromised?

Follow the steps outlined above, but you do not need to notify the police unless your credit reports show that new, unauthorized accounts have been opened in your name.

What should I do to clear my name if I find out that a thief has opened credit accounts in my name without my knowledge or permission?

For a step by step guide to clearing your name, see How to Clear Your Name:  A Guide for Identity Theft Victims.

Is there a way to check whether someone has stolen my identity?

If you suspect you might be a victim of identity theft, you should order a copy of your credit report.  Your credit report will contain information about all the credit accounts opened in your name (including accounts opened by a thief without your knowledge or consent).  You should order credit reports from all three major credit reporting agencies, since different creditors report to different agencies.  You can find find information about ordering your credit report here.

If you just want to check your credit report as a precaution (a good idea for everybody), you can order your credit report from annualcreditreport.com.  But, if you have experienced any of the common signs of identity theft mentioned above, we strongly recommend that you order your credit report by phone or mail directly from the credit reporting agencies.  You can get your report for free if you ask the credit reporting agency to place a fraud alert on your account.  For more information, see How to Clear Your Name:  A Guide for Identity Theft Victims.


More Information

How to Clear Your Name:  A Guide for Identity Theft Victims


Helpful Links and Resources

Federal Trade Commission

Identity Theft Resource Center

Complete text of the Truth in Lending Act:  see section 1643 for protections against unauthorized use

Complete text of the Fair Credit Reporting Act:  see sections 1681c-1 and 1681c-2 for identity theft protections.


Sources:  Federal Trade Commission, Identity Theft Resource Center, New Economy Project.


Disclaimer:  This site provides general information for consumers and links to other sources of information.  This site does not provide legal advice, which you can only get from an attorney.  New Economy Project has no control over the information on linked sites.

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