Fraudulent New Accounts

Most people assume identity theft only involves fraudulent purchases made to existing accounts. But, in the world of identity thieves, that type of crime is limited to novice thieves. Expert, or advanced, identity theft occurs when thieves steal your existing account information and use it to open new accounts in your name.  The types of accounts thieves can open ranges from bank or credit accounts, to utilities and home mortgages. This type of fraud is harder to catch because the new accounts may be in your name, but you don’t know about them. Bills for brand new accounts are typically mailed to an address other than your own. So thieves can usually spend years racking up fraudulent charges in your name without you even knowing about it.  

In most cases, people find out they have been victimized in this way when they go to open a new credit account (mortgage, student loan, credit card, etc…) and are denied credit because their credit has been destroyed by identity thieves.  The easiest way to ensure that someone isn’t out spending in your name unbeknownst to you is to obtain a copy of your free credit report from each of the three major credit bureaus each year. To do so, visit www.annualcreditreport.com  In the case that you discover a fraudulent account (or two or three) has been opened in you name, consult the list below for the immediate action steps that need to be taken.  
 

1. Contact the fraud departments of the three major credit bureaus: Equifax, Experian, and Trans Union. Alert them to the fact that fraudulent accounts have been opened in your name, and they will walk you through the appropriate steps to begin resolving the situation.  

2. Have a security alert placed on your consumer report by contacting Chex Systems Inc. by calling them at 1-800-428-9623 or visiting their site at www.chexhelp.com.They will contact all retailers alerting them not to accept any checks from the fraudulent account.

3. Close any accounts related in the dispute, stop any outstanding checks, and change your ATM card and PIN.  Be sure to check all your accounts to make sure that none of them have been affected. Make sure all of your accounts have been flagged as you don’t know what else the identity theft might do.   
 
4. File a police report and make sure to get a copy for your own personal records. Once the police report has been filed, local authorities will begin to investigate the situation. In some cases, certain police departments are not accustomed to handling identity theft issues. You have the option to contact the FBI if you feel they may be more adept to handling your case.

5. File a complaint with the Federal Trade Commission (FTC). 

New account fraud can have a harmful affect on your credit score. You may opt to have a security freeze placed on your credit, which will prevent anyone from being able to even access information about your credit history (or open new credit in your name) without you verifying that they have permission. You are given a PIN that allows you to have temporary access to your credit files and as long as that pin is secure, your credit is secure. To find out more about security freezes and the regulations that accompany them for each state, you can visit http://consumersunion.org. But security freezes and annual credit reports are only several of the preventative steps you should take to protect your identity. Shredding all documents and taking extra precautions when accessing important information online shouldn’t be neglected.  

For more information on how you can prevent identity theft from happening to you, click on several of the links to your right.