A column on personal finance prepared by the Virginia Society of Certified Public Accountants
PROTECTING YOUR IDENTITY AND YOUR CREDIT
(May 5, 2003) – Imagine this scenario. Your wallet is stolen. You immediately report the loss to your credit card companies and banks. Your old accounts are closed and new ones are opened in their place. You promise yourself you’ll be more careful in the future and put the incident behind you–but not for long. A month later, you get a late payment notice for stereo equipment you never bought, followed by a phone call from the bank regarding your overdrawn account. Then, your mortgage application is rejected due to a poor credit history.
Suddenly, you find yourself a victim of identity theft, the act of “stealing” or using another person’s name and information for personal gain. In a press release issued earlier this year, the U.S. Federal Trade Commission listed identity theft as the number one consumer fraud complaint in 2002. In fact, 43 percent of the complaints lodged in the Commission’s Consumer Sentinel database in 2002 were for identity fraud.
Securing Your Personal And Financial Identity
Although it’s nearly impossible to completely guard against identity theft, there are some steps you can take to protect your identity, credit, and sanity. Here are the recommendations of the Virginia Society of CPAs:
With the Social Security number so widely used, it is important that you take steps to limit access as much as possible. Make it a practice not to give out your SSN unless it is absolutely necessary or unless the requester makes an acceptable case of why it is needed. When practical, suggest alternatives such as your driver’s license number. Finally, never carry your SSN card in your wallet or purse.
Also, make sure any new checks you order arrive within the time specified by the bank and that the check numbers follow sequentially from your last checkbook. A thief can steal your new checks, using them to pay for items before you even realize you haven’t received them in the mail.
What to Do if Your Identity Is Stolen
As soon as you are aware that your personal information is being used fraudulently, you must take immediate action to minimize additional damage to your financial situation and your reputation. You should first contact your creditors to close your accounts.
Next, file a report with the Police Department in the jurisdiction where the identity theft took place and request a copy of the report. You may need to supply it to the banks or credit card companies where you have accounts.
Also be sure to notify the fraud units at the three major credit reporting agencies and request that they “flag” your file as possibly being subject to fraud. You can also ask that the agency add a statement that asks creditors to call you before opening any new accounts or changing your current accounts.
If you’re a victim of identity theft that involves the U.S. Mail, call your nearest Postal Inspection Service Office. If it’s your Social Security number that has been used fraudulently, notify the Social Security Administration’s Fraud hotline at 1-800-269-0271. It’s also a good idea to contact the Federal Trade Commission (1-877-438-4338), the agency responsible for receiving and processing complaints from people who believe they may be victims of identity theft.
It Can Happen to You
Identity theft is one of the fastest growing crimes in the U.S. It can quickly undermine an excellent credit history, and victims often spend months or even years untangling the related mess. Your name and good credit history are among your most valuable assets. Do everything you can to protect them.
The Virginia Society of CPAs is the leading professional association dedicated to enhancing the success of all CPAs and their profession by communicating information and vision, promoting professionalism, and advocating members’ interests. Founded in 1909, the Society has nearly 8,000 members who work in public accounting, industry, government and education. This Money Management column and other financial news articles can be found in the Press Room on the VSCPA Web site at www.vscpa.com.
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