Taking Back My Financial Identity

MichaelAutomation, Credit & Debt, Education, How to, Misc16 Comments

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It’s been a little over a month now since I first realized I was a victim of financial identity theft (to see how it all began, read >> My Financial Identity Crisis).  Since then, it’s been a rather lengthy learning process, but there is light at the end of the tunnel!  Thanks to all of my readers who reached out with concern for my well-being.

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Here’s how I’m taking back my financial identity:

Following Best Practices

As I noted in my previous post, the best offense, is a good defense!

In this post, I’ll discuss the defensive steps I’ve taken in additional detail.

  • Step 1: Notify IRS by Filing Form 14039
  • Step 2: Place a Fraud Alert with A Major Credit Scoring Bureau
    • (i.e. Transunion, Experian, Equifax)
  • Step 3: Continue Using 2-Factor Authentication & Complex Passwords
  • Step 4: Continue to Encrypt Documents with My Social Security Number
  • Step 5: Shred Old Documents That Contain Personally Identifiable Information
  • Step 6: Consider Investing in an Identity Theft Protection Service*
    • * (as recommended by my readers)
Step 1: Notify the IRS by filing Form 14039

I covered this previously, but just to recap, I filed IRS Form 14039 to prove my identity.  This was submitted along with 2 forms of identity proof, and my “real” tax return for 2015 so the IRS knows for certain it was ME that filed it.  🙂

To date, I haven’t heard anything back from the IRS.  They said it will take up to 4 months to process, but I may give them a follow-up call in a month just to see how things are going.

Step 2: Place a Fraud Alert with a Major Credit Scoring Bureau

alertsignSince I know my name and social security number is already “out there” being circulated on the dark web.  I am still at risk.  So, getting an initial fraud alert setup is a crucial step to “stop the bleeding” and prevent the financial ID thief (or future ones) from wreaking further havoc.

90-Day Alert

In fact, once you have any inclination that someone has been using your financial identity without your authorization, you can immediately place a 90-Day Fraud Alert onto your credit profile.  You can do this with any of the three bureaus I mentioned above.  For me, I called into Experian while I was driving (a little NET Time in action).  It was an entirely automated phone process and you can also easily do this online.

This 90-Day Fraud Alert will add in some extra security measures to be taken should anyone try to open up new credit under your name.  This will likely show up as a series of additional credit questions that only you should know, thereby preventing the thief from opening up unauthorized accounts.

(*Optional – you can even set up a Security Freeze which prevents anyone from opening ANY credit accounts under your credit profile.  A security freeze, however, is NOT shared amongst the other credit bureaus and must be initiated separately.)

After setting up this initial fraud alert, I have already received 2 of 3 confirmations from the credit bureaus.  Note, that you only need to set this up with one bureau (eg. Experian) and they will subsequently share and propagate this alert with the other two bureaus.

Extended Fraud Alert

Okay, but we’re not done yet.  It’s great to have 90-days of additional protection, but what if you’re sure your financial ID was compromised like me?  Well, I found out that you can get an extended fraud alert that lasts for 7 years!  This is great, but it does require a couple of extra steps and yet ANOTHER form.

I couldn’t find the extended fraud alert form on Experian’s site right away, but I was able to find Transunion’s posted here.  Since these alerts are shared between bureaus it shouldn’t matter who I sign up with for the Extended Fraud Alert.

You’ll also need to get a theft report from your local police department.  You’d think this would be a pretty simple step, right?  Well, it just depends on the police department you’re dealing with.  I had to jump through so many hoops to get this accomplished, I felt like I was in the circus!

(Theft Report Drama)

After calling the main police line, I requested to speak with someone to help me file a report.  I was asked to leave a number and an officer would call me back.  I got a call a couple of hours later and reported the incident.  The officer took my information and told me the best way to get a copy of the report would be to visit the main police department in person.  So, I wrangled the kids into the car the following day and we took a trip to our local police department (which I was hoping would be a little fun and educational).

Let’s just say, it was like going to the DMV!  How hard is it to print out a piece of paper??  Nope.  I had to get in line to file a request first.  Filled out the request form and a self-addressed envelope.  Got back in line, and they confirmed my ID.  Asked to wait in the lobby (I didn’t see many other people waiting, but it took 45 minutes!)  Called into another area to pay $1 for processing, and told me that it would take 10 days or less to mail out to me.  I believe it took 7 days.  But, it GOT IT!

Okay, so the completed extended fraud alert form along with ID copies, and the theft report is going into the mail tomorrow!

Step 3: Continue Using 2-Factor Authentication & Complex Passwords

and

Step 4: Continue to Encrypt Documents with My Social Security Number

I’m combining these steps together as I have previously mentioned specifics before here, but it can’t really be stressed enough!

Step 5: Shred Old Documents with Personally Identifiable Information

Don’t give identity thieves low hanging fruit by discarding sensitive documents directly into the trash or recycle!  Thieves are looking for easy targets which won’t require a lot of work.  Buy yourself a decent shredder, or take it somewhere to be destroyed like Goodwill.  (If you’d like to read about how I’ve gone mostly paperless these days, check out this post.)

Step 6: Sign Up for A Credit Monitoring Service

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As someone who monitors my credit somewhat frequently, I didn’t really think to suggest a credit monitoring service (thanks to a couple of my readers for bringing it to my attention).  Sure, there are great free ones like Credit Karma, but if you really want peace of mind and want to pay to automate this process, you may consider a credit monitoring service.

Here’s why…

As you may know, your credit is tracked by 3 primary credit scoring bureaus – Transunion, Experian, Equifax.  Each of these bureaus track your individual credit history (bills, credit cards, mortgages, rent, car payments, etc.) and compile a record of your activities over time (i.e. your credit report).  This credit report shows all of the institutions that have extended you credit score represents a numerical representation of how credit-worthy you are.  And, for anyone who’s tried to get financing before, you know just how important this credit score is!

An identity thief may use your social security number and name to apply for credit.  If you’re not aware of this, a thief could literally open up new credit card accounts under your name and use them without your knowledge.  Guess what happens when the thief racks up huge sums of $$$ on these credit cards?  Well, the thief obviously has no intention of paying it off, so the credit card debt will go unpaid and eventually hit your credit report in a very BAD way as delinquency, non-payment, and eventually default.  This will ravage your credit score quickly.

A credit monitoring service will help you to keep tabs on what’s going on with your credit activity.  You will get active notifications if a new line of credit opened, inquiries are made, etc.

There are A LOT of companies out there that provide these services.  Since I haven’t used any of them yet, I don’t have much of an opinion yet.  But, I did sign up with FamilySecure which is an offshoot of Experian.  The reason I signed up with them is that we received a code for a year of free credit monitoring services for the entire family.  You see, my wife got a letter a couple of weeks ago telling her that her HR’s provider had been hacked and information lost.  See, yet another leakage of my SSN!!

Anyhow, typically when there is a breach like this, you have to be notified by law and most companies will provide you with a certain length of free credit monitoring.

It will be nice to know what’s going on with the entire family’s credit for the next year.  Beyond that, I may add one of these services indefinitely, but we’ll see once we get to that point.

Here are a few other credit monitoring services I’ve come across:

Final Thoughts

It’s nice to be nearing the end of this identity theft “learning curve”.  Of course, I don’t wish this upon anyone, but hopefully, these posts will help anyone that comes up against similar issues in the future.

Readers, have you ever used a credit monitoring service before?  Did you pay for it, or simply get it for free due to a security breach?

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Michael

Hi, I have been blessed to take an early retirement in my mid-30's so I can focus on becoming a better father, blogger, and investor.

My goal is to help you find your personal path to financial freedom, and to enjoy the entire journey.

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16 Comments on “Taking Back My Financial Identity”

  1. Glad to hear that things are progressing along! I guess the silver lining that you’ve managed to turn it into quite the informative series for your readers – and your credit is super-ultra on lockdown now!

    I have to admit, I’m terrible about shredding sensitive documents, but I resolve to do a better job from now on!

  2. Wow, what a pain in the %^&!! And the way I understand it, this is just becoming more and more common.

    My wife and I have been using 2-factor authentication and complex passwords for a while now and making sure to shred everything that is remotely confidential. I do like the idea of encrypting documents – I actually use a BitLocker container on my drive that holds all my financial documents which works wonderfully.

    On the glass half full side of things, because everyone seems to be getting hacked lately, it seems like everyone’s giving away free credit monitoring. I feel like I get a letter from a hacked company every year… so it usually extends my monitoring for free! Horrible that it happens, but it’s becoming a regular part of life for people.

    — Jim

    1. Jim, you’re right unfortunately. ID Theft is here to stay and most will likely be a victim at some point in their lifetime. I feel most bad for those who haven’t looked at their credit in years only to find out they’ve been taken advantage of. Nice job of staying on top of the free credit monitoring. I know people who get those free ones and won’t even take the few minutes to sign up!

  3. this is crazy. good job on taking your financial identity back. I will be looking for an opportunity to purchase some kind of credit monitoring or identity theft insurance. the last thing I want is to have my financial goals put in jeopardy by identity theft!

    1. I think you’re smart to do that, Jesse. In the future, I think ID theft insurance and related services will be as common as auto insurance!

      1. it makes sense. criminals are getting more and more savvy and the dark web is growing. Thanks for the recommendation on what kind of protection to consider.

  4. @Michael – Are you also regularly checking your credit report? The government requires the three credit agencies to provide one free report each year at annualcreditreport.com. I spread them out over the year and check one every four months (I also do it alphabetically to make it easy to remember – so Equifax (Jan – April), Experian (May-August) and then TransUnion (September – December).

  5. My employer shared my PII and I demanded protection. I have one year of LifeLock that I am waiting for my company to reimburse me for. There have been no problems due to their breach yet.

  6. Wow, sorry to hear you went through all of this Michael. This really sucks, and it sounds like quite the hassle by the police. Why couldn’t they just have done it then and there, then given it to you. It would have been a lot quicker.

    Hopefully you’ve stopped the rot. We haven’t ever used a credit monitoring service, I suppose if we went through something like what you just did, we would.

    Tristan

    1. Thanks, Tristan. I’m lucky it the damage didn’t go any further than it did. The worst would be to find a bunch of credit and accounts open that I never authorized.

      Is ID theft a big problem in Australia too?

  7. Awesome to hear that you’re taking it back! Good to see the pro activity you’re showing here man..
    Thanks for updating & all the best with protecting it 🙂

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