7 Ways to Recognize Identity Theft (And 5 Steps to Take If You’re a Victim)

by Vincent King · 7 comments

Identity theft

The phone rings, and a voice on the other end says you owe $25,000.

Impossible. You have impeccable credit. Or, so you thought.

It turns out that someone’s been using your identity and has now run up mountains of debt. Unfortunately, this is all too common these days.

According to IdentityTheft.info, identity theft strikes 15 million people per year.

Those 15 million victims suffer from $50B in damages. As e-commerce and online banking turn internet finance into the norm, these numbers could increase even further.

Identity theft does plenty of financial damage, but it does psychological damage, as well. In some cases, people have even been arrested because of activity committed by the thief that was in no way their fault. Identity theft is a painful event — filled with stress — and it’s not easily corrected or prevented.

But what happens if you don’t know that your identity’s been stolen? Your financial life could be ruined. There are services you can pay to protect your identity, and they’ll be responsible if anything should happen. There are also credit monitoring services and identity theft insurance.

But, if you’re not using those companies, you’ll need to keep your own watch on your name and funds.

Recognize these warning signs and act quickly to start damage control and reclaim your life.

7 Signs of Identity Theft

1. Inaccurate bank statements

Keep an eye on your bank statements and be on the lookout for inaccurate withdrawals and payments. Know your bank’s policy for entry errors, as well as for identity theft. Discuss any problems with your bank’s manager immediately.

2. Mistakes on your credit report

If you’re not doing your recommended yearly check of your credit report, you could be missing signs of illegal activity. Finding issues, such as loans you didn’t apply for, or defaults on payments, let you know that there may be fraudulent activity happening, and that you need to take action.

3. Calls from creditors for things you never bought

If you haven’t bought from or used the company the creditor is calling you about, someone’s probably been using your name and/or social security number. It’s also possible that the company entered the data incorrectly, but you must follow up to find out.

4. Unusual calls from your bank

If your bank is calling you regarding irregular activity, let them know that there’s a problem. If you get an email asking for details, never respond by sending the information online. Go to your bank and speak with them personally.

5. Problems with medical insurance

If your coverage is denied for a procedure that’s already been performed and it hasn’t — not on you, at least — someone else could be using your medical insurance. Take action with your insurance company immediately.

6. An empty mail box

If you normally get loads of mail, then you suddenly stop receiving any statements, you may have been ripped off. If someone has hacked your online banking accounts and changed your address, you won’t get your statements — so check with your lender and make sure your information is still correct.

7. Notification of loan approvals

You may get approved for a loan you didn’t apply for. If this happens, immediately contact the lender and deny the loan.

Now, suppose you have one or all of the above happen to you. What should you do?

What to Do if You Suspect Identity Theft

1. Place a fraud alert. Call one of the three major credit reporting agencies and let them know there’s fraudulent activity happening with your account.

2. Ask them to put your file on fraud alert.

3. Make sure they’ll contact the other two credit reporting agencies.

4. Mark your calendar to renew the fraud alert within 90 days, if necessary.

5. Update your files and document the date.

Identity theft causes billions of dollars in damage each year. Make sure your share isn’t part of that total.

Have you been a victim of identity theft? Do you have any tips to prevent it? 

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{ read the comments below or add one }

  • Earl Pulliam says:

    It disappointing big companies are not prosecuting this card thieves. A crook stole my Home Depot credit card number and charged $ 7000. before he was stopped. Not responsible for charges. Home Depot had video of the purchases. Would not let me view the video or let me press charges because it was not my loss. Crooks win again. Home Depot did nothing!!!! Only thing that stopped the crook was my credit card limit.

    • David @ MoneyNing.com says:

      Home Depot probably figured it costs them more than $7,000 to try and convict that person, assuming they are even able to locate him/her.

      Letting thieves get away with crime does suck, but that’s just how big companies think.

  • zimmy@moneyandpotatoes.com says:

    I was the victim of identity theft a couple of months ago. The thief was nice and only paid his/her car insurance bill with the money and nothing else. It still put us in a financial bind for that pay period though. I would suggest checking your bank account every single day and looking for charges that are out of the ordinary. If you see anything that looks suspicious contact your bank as soon as possible.

  • Bert says:

    It happened to me. The worst result is the refusal of creditors, old and prospective, to consider the possibility that a human may be able to make a decision better than a computer. I have been pursuing an inventory loan for two years now with no luck. These thieves should be severely punished for the lives that they ruin.

  • Cherleen @ My Personal Finance Journey says:

    I may be fortunate enough I have not experienced any attempt of identity theft on my accounts. I follow simple steps. I do not click on links on my email, especially links saying that they are bank representatives. Furthermore, I see to it that my passwords are a combination of letters, numbers, and symbols, and they are not related to any of my personal information.

  • Christian L. says:

    Vincent,
    I’ve been fortunate all the times my identity has been stolen (four times, FYI). My banks have always contacted me immediately and my credit has not been hurt. In fact, one guy got caught in Kentucky and had more than 10 counts of fraud against him. I was happy to get a letter in the mail from a prosecuting attorney about it!

    -Christian L. @ Smart Military Money

  • John S @ Frugal Rules says:

    Those are some crazy numbers! The closest we’ve been was someone stole my credit card number last year and went on a shopping spree. Thankfully my credit card company noticed the issue and contacted me right away. They had a new card to me the next day and I did not have to pay a cent of it.

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