Fraud and Identity Theft

Fraud and Identity Theft

It is important to protect yourself against fraud and identity theft – understand the different ways it can happen, avoid the most common fraud-causing situations, and what to do if you have had this type of problem.

Fraud and Identity Theft: Corporate and Personal Costs

Fraud costs the American economy millions of dollars per year in losses. Between January and December, 2003, the Federal Trade Commission received over half a million consumer fraud identity theft complaints, with losses of over $400 million reported. The losses affect consumer savings accounts, retirements and the ability to purchase homes. Bank accounts have been emptied with no recourse.

Increased e-commerce from the rise in Internet use has opened the doors for easier fraud perpetration. While companies involved in information technology have invested in increased security, fraud prevention is a continuing battle requiring the awareness of both consumers and businesses. The good news is that there are simple steps you can take to help prevent unauthorized access to your information and finances.

Although fraud can take many forms, our advice will be mainly focused on the types that most affect credit reports and scores. We have also provided additional links at the end of this section for further research.

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Common types of fraud

  1. Identity theft: Identity thieves gain access to information that allows them to pose as someone else. They may steal boxes of checks, bank statements or other mail from a mailbox; steal a wallet or purse and use the information to open new accounts, as well as spend on existing credit cards or checks; or extend a fraudulent offer to you via phone or mail. Many people who have had their identities stolen have not found our until the next time they try to open a new credit account, or apply for a home or other type of loan.
  2. “Phisher” or mock websites: This is a rather new phenomenon, where perpetrators duplicate a website and send emails requesting that a customer reapply or provide security information. The information is then used to steal the consumer’s identity, access bank funds, or apply for fraudulent loans. The phisher site spam emails tell consumers to click on a link to what looks like a real corporate website and input their personal information. The fake website looks like it comes from a legitimate company with whom a consumer may have a relationship, but the fraudulent site is really just a vehicle to steal consumer information.
  3. Social Security Fraud: This happens when someone gains access to a Social Security number and uses it, along with other personal information, to commit fraud or identity theft. Social Security numbers of deceased or retired persons via their Social Security checks, along with an address, can allow someone to apply for credit reports that often contain enough additional information for a perpetrator to take the next step.
  4. Intercepting credit card numbers from online transactions or databases: When consumers buy goods or services over the internet, it’s rare to have the credit card information transferred without encryption, or coding, to prevent hacking. But there are still some cases where computer hackers gain access to information as it is sent. Hackers also search for weaknesses in databases maintained by businesses, government and financial institutions, and attempt to exploit them to gain account numbers. The incidence of breaking into these databases is not high, but one access breach can give perpetrators access to thousands of account numbers at once.
  5. Mishandling of credit reports: Credit reports contain all the information a thief would need to steal using existing accounts, or to steal one’s identity completely and cause major financial harm. There are several ways those in the credit reporting industry manage to balance the need for accurate account information to rate, while keeping enough information hidden to protect the public from theft. Strict compliance regulations from bureaus and the government require credit report users to have passed many hurdles to begin ordering and using credit reports. In addition, account numbers are partially masked on copies assessable to consumers. Data security standards are extremely high, and audits are frequent.

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How to Prevent Fraud & Identity Theft

There are several ways you can help prevent fraud and identity theft.

  • Destroy private records and statements.  Tear up, or shred credit card statements, solicitations and other private documents that contain private financial information. Any information you keep, be sure to keep in a secure place.
  • Secure your mail. Empty your mailbox quickly, or get a PO box so criminals don’t have a chance to steal credit card pitches. Never mail outgoing bill payments and checks from home. They can be stolen from your mailbox and the payee’s name erased with solvents. Mail them from the post office or another secure location.
  • Safeguard your Social Security Number.  Never carry your card with you, or any other card that may have your number, like a health insurance card. And don’t put your number on your checks. It’s the primary target for identity thieves because it gives them access to your credit report and bank accounts.
  • Don’t leave a paper trail. Never leave ATM, credit card or gas station receipts behind.
  • Never let you credit card out of your sight. Worried about credit card skimming? Always keep an eye on your card, or, when that’s not possible, pay with case.
  • Know who you’re dealing with. Whenever anyone contacts you asking for private identity or financial information, make no response other than to find out who they are, what company they represent and the reason for the call. If you think the request is legitimate, contact the company yourself and confirm what you were told before revealing any of your personal data.
  • Take your name off marketers’ hit lists. In addition to the national “Do-Not-Call registry 1-888-832-1222, you can also cut down on junk mail and opt of credit card solicitations by calling 1-888-5-OPT OUT.
  • Be more defensive with personal information. Ask Sales people and other if information such as a Social Security or driver’s license number is absolutely necessary. Ask anyone who does require you Social Security number – for instance, your insurance company – what their privacy policy is and whether you can arrange for the organization not to share you information with anyone else.
  • Review your credit card statements carefully. Make sure you recognize the merchants, locations and purchases listed before paying the bill. If you don’t need or use department-store or bank-issued cards, consider closing the accounts.
  • Guard your information. Do not give out your account numbers, login information or passwords for online transactions to others.
  • Know your delivery dates. Know when your account and bank statements come to you by mail, and contact the account holders or bank when you do not receive them by the usual dates.
  • Beware of unencrypted websites. Make sure you do not send your credit card information for online purchases through websites that are not secured & encrypted, or by mail.
  • Watch your ATM card. Be aware of those behind you when using the ATM machine; guard viewing access to your pin entry.
  • Don’t fall for telephone solicitations. Do not give your credit card, Social Security number of other personal information to telephone solicitors. If you are interested in the product, research the company and it’s product first and call them back to order if legitimate. Do not give any personal information over the phone in exchange for the promise of “winning” anything.
  • Email solicitations. If you receive an email directing you to the website of a company with which to do business, requesting for you to provide account numbers or other private information, do not provide the information. Contact the company directly to determine the legitimacy of such a request.
  • Be careful where you write your information down. Do not write account information or pin numbers on cards or places whereby a thief may be able to access both credit cards and pine numbers in the same theft – for example do not write your pin number on the backs of your credit or ATM cards.

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What to do if it Happens to You

The signs can very, but typical indicators of fraud and/or stolen identity include:

  • One of your creditors informs you that they have received an application for credit with your name and Social Security number.
  • Incoming calls or letters stating the you have been approved or denied by a creditor to which you never applied.
  • You receive credit card, utility, or telephone statements in your name and address for which you never applied.
  • You no longer receive your credit card statements, or notice that not all of your mail is delivered to you.
  • A collection agency tells you they are collecting for a defaulted account established with your identity, but you never opened the account.

If you think you have become a victim of identity theft, or fraud, act immediately to minimize the damage to your funds, financial accounts and credit report. Below is a list of some actions that you should take right away:

Contact the Federal Trade Commission (FTC) to report the situation:

By telephone toll-free at 1-877-ID-THEFT (877-438-4338 or TDD at 202-326-2502, or
By mail to Consumer Response Center, FTC, 600 Pennsylvania Avenue, N.W., Washington, DC 20580.

Under the Identity Theft and Assumption Deterrence Act, the Federal Trade Commission is responsible for receiving and processing complaints from people who believe they may be victims of identity theft, providing informational materials to those people, referring those complaints to appropriate entities, including the major credit reporting agencies and law enforcement agencies. For further information, please check the FTC’s identity theft web pages. You can also call your local office of the FBI or the U.S. Secret Service to report crimes relating to identity theft and fraud.

You may also need to contact other agencies for other types of identity theft.

  1. Your local office of the Postal Inspection Service if you suspect that an identity thief has submitted a change-of-address form with the Post Office to redirect your mail, or has used the mail to commit frauds involving your identity.
  2. The Social Security Administration, if you suspect that your Social Security number is being fraudulently used (call 800-269-0271 to report the fraud.)
  3. The Internal Revenue Service if you suspect the improper use of identification information in connection with tax violations (call 1-800-829-0433 to report the violation.)

Call the fraud units of the three national credit bureaus:


  • To Report fraud, call 800-525-6285 or write to P.O. Box 740250, Atlanta, GA. 39374-0250.
  • To order a copy of your credit report go to or call 800-685-5000 or 800-685-1111.
  • To dispute information in your report, call the phone number provided on your credit report.
  • To opt out of pre-approved offers of credit, call 888-567-8688 or write to Equifax Options, P.O. Box 740123, Atlanta, GA 303-74-0123.


  • To report fraud, call 888-EXPERIAN or 888-397-3742, fax to 800-301-7196, or write to P.O. Box 1017, Allen, TX 75013.
  • To order a copy of your report, go to or call 888-EXPERIAN.
  • To dispute information in your report, call the phone number provided on your credit report.
  • To opt out of pre-approved offers of credit and marketing lists, call 800-353-0809 or 888-5OPTOUT or write to P.O. Box 919, Allen, TX 75013.


  • To report fraud, call 800-680-7289 or write to P.O. Box 6790, Fullerton, CA. 92634.
  • To order a copy of your credit report, go to or call 800-888-4213.
  • To dispute information in your report, call the phone number provided on your credit report.
  • To opt our of pre-approved offers of credit and marketing lists, call 800-680-7293 or 888-5OPTOUT or write to P.O. Box 97328, Jackson, MS. 39238.

Contact all creditors with whom your name or identifying data have been fraudulently used. For example, you may need to contact your long distance telephone company if your long-distance calling card has been stolen or you find fraudulent charges on your bill.

Contact all financial institutions where you have accounts that an identity thief has taken over or that have been created in your name but without your knowledge. You may need to cancel those accounts, place stop payment orders on any outstanding checks that may not have cleared, and change your Automated Teller Machine (ATM) card, account and Personal Identification Number (PIN).

Contact the major check verification companies (listed in the CalPIRG-Privacy Rights Clearinghouse checklist) if you have had checks stolen or bank accounts set up by an identity thief. In particular, if you know that a particular merchant has received a check stolen from you, contact the verification company that the merchant uses:

  1. CheckRite: 800-766-2748.
  2. ChexSystems: 800-428-9623 (closed checking accounts)
  3. CrossCheck: 800-552-1900
  4. Equifax: 800-437-5120
  5. National Processing Co. (NPC): 800-526-5380
  6. SCAN: 800-262-7771
  7. TeleCheck: 800-710-9898.

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Additional Resources for Fraud & Identity Theft

Equifax’s resource center for fraud and identity theft.

Experian’s resource center for fraud and identity theft.

TransUnion’s resource center for fraud and identity theft.

The Department of Justice’s (DOJ) links on identity theft, identity fraud, preventing fraud, what to do in the event of identity theft and more.

Federal Trade Commission (FTC)
Information and a toll-free number to the Federal Trade Commission (FTC) call if you have been subject to identity theft.

FTC What to do & Whom to Contact in the event of identity theft and best methods for recovering.

Social Security Administration information regarding Social Security fraud, how to prevent it and what to do if you’re a victim.

Depart of Justice notice warning consumers about the different methods of fraud and identity theft, both off and online.

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