Identity theft is no joke. It happens all the time and it will probably happen to you at least once before you die.
Identity theft can come in various forms, but the most common (and, fortunately, the least seriously damaging) is when the identity thief somehow obtains enough of your personal information to borrow money in your name. Since many credit card companies, finance companies, and payday lenders do business online now, all an identity thief needs is your name, address, and social security number to enable them to borrow thousands of dollars in your name. Most people don’t find out until they receive a bill for a loan they never received or a credit card they never used! Then a debt collection agency finds out where the victim lives by “skip tracing” them, and starts trying to collect. So what do you do?
1. Stop the Bleeding. File an Identity Theft Report.
The first thing you have to do is prevent any further fraud being committed against you or against others in your name. To do this, you’ll need to create an Identity Theft Affidavit and Report. Go to: https://www.ftccomplaintassistant.gov/
UPDATE: Since the problem of identity and information theft continues to grow, the numerous federal agencies that help people fight ID and Info Theft have built a new, streamlined website to make it easier to get yourself on the road to information security: www.identitytheft.gov.
These federal government-operated websites are useful for helping you get an immediate alert out there. Once you’ve provided your information on their website, it will generate an ID Theft Affidavit for you. Your local police department or state attorney general’s office probably has an ID theft affidavit you can use as well.
You must file a police report. You can use the FTC Affidavit to assist with your police report. Visit your local police department and explain what you know about your identity theft. You’ll have to sign a police report and provide proof of your own identity. This step may seem intimidating or time-consuming, but it is very important. Before any credit reporting agency or creditor can be held liable for reporting someone else’s debts against you, the law requires that you first make an honest and clear attempt to resolve the matter on your own. Keep records of everything!
Once you’ve signed an Identity Theft Affidavit and filed a police report, then you can request that the credit bureaus place a security freeze on your credit information. This will prevent your credit information from being abused again, and will limit other peoples’ access to your credit.
2. Tell them they’ve made a mistake. Don’t call them on the telephone. Write them a letter. I understand the temptation to try and resolve what you see as a simple mistake with a quick phone call. And if it were likely to work, I’d recommend it.
But it won’t fix the problem. Why? Because debt collectors do nothing all day but sit in a cubicle listening to people whine (or protest) about why they can’t send any money. They hear a lot of protests, some are true, some are BS. And unless you can whack them over the head with proof that the alleged debt was the result of identity theft, they’re going to assume that they’re right and you’re just a loon who forgot that you had an old $438 Target card that you quit paying after you moved from your old address.
And here’s the real problem: You have no record of the conversation. So later, when you need to prove that they knew all along that you were the wrong debtor and they kept harassing you anyway (which is totally illegal and makes them liable to you for $1000 plus attorney’s fees), you have no proof.
Fortunately, the law provides a simple solution if you are dealing with a debt collector: the 1692g validation request. You can see one here:
If you’re dealing with the original creditor, then you can’t use the FDCPA, but you can still dispute the error and demand that they quit reporting it to the credit bureaus. You can see a sample dispute letter here:
Send them a letter telling them they’re wrong, that you were identity thefted, that you don’t owe money, and that you demand that they quit reporting the debt as being owed to you.
Next, we’ll go over what you need to do about your credit reports if you’ve been the victim of identity theft.
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