Chapter 1. Key Statistics
- 11.1 million adults were victims of identity theft in 2009
- The total fraud amount was $54 billion
- The average victim spent 21 hours and $373 out of pocket resolving the crime
- 4.8% of the population was a victim of identity fraud in 2009
- 13% of identity fraud crimes were committed by someone the victim knew
Chapter 2. The Most Common Types of Identity Theft
While working as a credit repair expert, I encountered many clients who were victims of identity theft of some kind. The following are the most common types of identity theft:
Section 1. Getting Credit In Your Name
This is the most basic form of identity theft. This is where your mail or personal information is stolen and the perpetrator proceeds to apply for credit in your name with your personal information.
Section 2. Child Identity Theft
This is most commonly (unfortunately) used by the child’s parent to get utilities turned on under the child’s name and social security number, typically because the parent had defaulted on the utility in their own name, and is now using their children to perpetuate their irresponsible behavior. I have also heard of parents, and others, using a child’s social security number to get credit cards and other loans.
The sad thing about child identity theft is children will have no reason to suspect or even want to investigate their credit usually until well into their 20’s. By this time, their credit could have been completely destroyed years ago all under their noses without their knowing.
Section 3. Elder Abuse
This is where trusting elderly parents assign power of attorney to their children or another “trusted” adult to take over their financial affairs and the trustee then uses the elderly adult’s information to get credit which they will have complete control over.
Elder abuse is the type of abuse that seriously upset me the most. The reason is because by the time the elderly adult finally catches wind that their credit is destroyed fraudulently by their children or trusted others, the damage is already extreme and then the elderly discovers that what actually occurred was a crime and is very punishable, they take the defense of the perpetrator (because they love them). They don’t want to see their loved ones punished, so they most often do nothing but endure the financial hardships. I try to explain to these clients that the only difference between someone who steals your wallet on the street and what has just occurred is that you know your abuser. The crime is exactly the same. I further explain to these victims that unfortunately, the banks don’t care about the circumstances of what happened, they just want to get paid; and without a police report and an accusation, the debt is on the elderly person’s shoulders.
Chapter 3. How to Protect Yourself
If at all possible, never agree to a “general power of attorney”, instead opt for a “limited power of attorney”, this will make it so that you can specify exactly what a particular person can and cannot do. If at all possible, never give anyone complete control over your personal affairs.
Put a fraud alert on your credit reports. This is most easily done by calling 1-800-525-6285. Putting a fraud alert on your credit reports is free and will make it impossible to get instant credit approvals, it will also force lenders to call you and verify certain aspects of your credit that only you should know before the loan process can proceed.
One of the most common ways people steal your personal information is by filling out “pre approved” loan applications you get in the mail. They simply steal your mail and fill out the applications for you except they have the address changed to their address. The easiest way to combat this is to simply get rid of those pre approved offers. Go to www.optoutprescreen.com , click on the big blue button at the bottom of the page which will allow you to opt out or opt in, fill in your basic information, this will then prohibit the credit bureaus from selling your information to companies who purchase your information with the intent of offering you “pre approved” offers. By doing this online it will last 5 years. If none of these offers are coming in the mail there will be nothing for the thieves to steal and divert to themselves. You may also want to get either a secure PO Box or a locked mail box to protect the rest of your mail.
Your final line of defense is by simply paying close attention to your credit. You are allowed, by law, to access your credit reports free every 12 months by going to www.annualcreditreport.com. Pay close attention to anything you don’t understand or recognize.
By following these simple and free steps, you will be able to give yourself just as good of protection as any paid service available. Education and awareness are key in keeping your identity and financial assets secure. You now have the information to accomplish this. Good luck!