Identity theft will likely the number one complaint to the Federal Trade Commission in 2015. I can state that with some conviction because identity theft has been the number one complaint to the FTC for the last 14 years. The question most of us wrestle with is this…how do I know my identity has been stolen?
Ground Zero… Your Credit Report
The only reason you’d be the target of an identity thief is because you have an identity. That’s your “value” to a thief and to them it’s as good as currency. And because identity theft is a financial crime, money or access to capital is the crook’s end goal.
We all have the ability to apply for credit. Add over 10,000 creditors in the U.S to the fact that most of us have average to above average credit reports and credit scores and you’ll see that access to easy credit isn’t terribly difficult. That’s not a secret and the fraudsters know this. That’s why your credit identity is always in the cross-hair of an identity thief.
Thankfully the credit reporting system is set up in such a way that consumers can immediately see if their identity has been used to apply for credit on behalf of another person. And while credit reports are not “real time” in their reporting of account information, they are in their reporting of changes to your identification information and credit related inquiries. This makes credit monitoring an effective tool to notify you when fraud has possibly occurred.
What Changes On My Credit Report Could Be Indicative of Fraud?
While it is certainly possible that changes to your credit reports does not indicate fraud, it’s in your best interest to be cognizant of any substantive change to your personal information. Changes to any of following areas could mean identity theft:
If a new address hits your credit reports it could mean that a fraudster has applied for credit in your name but with a different address. Addresses are updated on credit files when new applications for credit are submitted. This is the reason monitoring the address section of your credit report is so important.
An inquiry is a record of someone or some company pulling your credit report, and the date on which the access occurred. If a fraudster applies for credit in your name and the lender accesses your credit report a record of the access will hit your credit report immediately and trigger an alert from a credit monitoring service.
If a fraudster is successful opening a new account in your name then it’s very likely that account will be reported by the creditor to one, two, or all three of the national credit reporting agencies; Equifax, Experian and TransUnion. Again, the new account will trigger credit-monitoring alerts.
If a fraudster opens a new account in your name he or she is unlikely to make payments, which could result in the loan going into default and to a collection agency. And while the fraudster probably didn’t give the lender your telephone number, collectors have very effective ways of acquiring that contact information. If you start getting calls from collection agents attempting to collect a debt that you don’t recognize, it could be the result of fraud. At this point your problems are significant because you’ll be telling the collection agent the same thing that legitimate debtors in default are telling them…”that’s not my account.”
If you’re worried about becoming a victim of identity theft, you should at the very least check your credit reports on a regular basis. There are also free resources like CreditSesame.com, where you can get your free credit score and free credit monitoring to help you pinpoint any unauthorized inquiries or new account openings that are often the first signs of identity theft.