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Frequently asked questions about identity theft


Identity theft is the fastest-growing crime on the government's list of consumer fraud complaints for the fourth consecutive year, according to the Federal Trade Commission. Forty-two percent of all complaints in 2003 related to the theft of personal information such as a Social Security number or credit card information. Here are some of the more commonly asked questions about this scary crime.

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What's the first thing I should do when I find out that I'm an identity theft victim?

Contact the fraud department of any one of the three major credit bureaus and report that your identity has been stolen. That agency will contact the other two credit-reporting agencies. A "fraud alert" will automatically be placed on each of your credit reports within 24 hours. The alert serves as a notice that no new credit should be granted without your approval. Not all creditors pay attention to these alerts. You need to be vigilant that no new accounts are opened. Follow that by contacting each of your creditors (credit card companies, mortgage lender, etc). Explain what happened in writing. The Federal Trade Commission offers an ID theft affidavit that simplifies the process. Instead of filling out a separate fraud packet for each creditor, you may fill out a single fraud declaration and send signed copies to each creditor. Most companies will accept the form, but when you contact each creditor, ask if they will accept it. You may also call the FTC's Identity Theft Hotline toll-free at 1-877-IDTHEFT (438-4338). It's very important that you file a report with your local police department and perhaps the law enforcement agency where the identity theft took place. Get copies of the reports and send to all the creditors. For more details, check out this Bankrate story.

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Do I really have to give my Social Security number at my doctor's office?

You can say no. While any business or agency can ask for your number, few can actually demand it. Agencies that can demand it are generally government related, such as motor vehicle departments, tax departments and welfare departments. Because Social Security numbers are required for transactions involving taxes, banks, brokerages, employers, and the like also have a legitimate need for your number. Most other businesses have no legal right to demand your number. Always ask if they'll accept an alternative piece of identification. To learn more about this subject, read Guard your Social Security number.

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How can I protect myself from identity theft?

Aside from getting a credit report at least once a year to monitor your credit, you should always be alert when your monthly financial statements arrive. Carefully read over your bank statements and other creditor statements to make sure you recognize all the items listed. Get a cross-cut shredder and shred bank statements, credit card offers, or any other document with your financial information on it. Mind your credit card receipts because some still list your full account numbers and expiration dates. Here are 15 more ways to protect your identity.

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How does identity theft happen?

All it takes is one slip (of paper) for an identity thief to strike. The most obvious way to steal someone's identity is to snatch a wallet. Thieves also comb the dumpsters of banks, mortgage companies, restaurants and other businesses for receipts, credit slips and applications. Skimming devices are also used to take the encoded information on the magnetic strips and create new accounts. Then there's shoulder-surfing, when thieves stand close enough to see PIN numbers punched in by ATM or phone booth users. And if you have a common name, your credit's more likely to get mixed up with the other John Smiths out there. For more information about how this can happen, check out this Bankrate story.

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Should I consider purchasing an identity theft insurance policy or a credit monitoring service?

If you've been the victim of identity theft and need to keep a close eye on things like credit card and loan applications, or if you just like to stay on top of your credit information, these products and services are probably worth looking into. Just keep in mind that the credit bureaus and the Federal Trade Commission can provide some of the same services for free. For more information, check out this story that explains what to expect from these services.

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-- Posted: April 6, 2004



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