Terry Savage: Identity theft epidemic
Identity theft is becoming its own pandemic. It grew exponentially as unsophisticated state governments processed unemployment complaints without proper security precautions. The U.S. Department of Labor estimated earlier this year that at least $89 billion of the estimated $896 billion in federal unemployment program funds were paid out improperly!
But the problem has grown far beyond fraudulent unemployment claims. The FBI just reported there have been 30,000 ID theft cases nationwide in the first four months of 2021, compared to 40,000 cases in all of last year!
Fraudsters have moved far beyond creating false unemployment claims. Emboldened, international scam rings are using texts and emails in sophisticated attempts to get you to click on links and reveal private information.
Seniors are often the victims, but even the supposedly tech-savvy are not immune. The texts and emails no longer have crude spelling errors and obvious flaws. They copy corporate and government logos carefully.
Even worse, they have learned to appeal to your existing concerns about identity theft, advising you to click or sign in through a link in order to view suspicious unemployment reports made in your name or suspicious banking or purchase activity. When you click to “sign in,” you are giving away your own information!
Protection and prevention
View every text from an unknown source as suspicious, and check domain names on unsolicited emails. Think twice. And never click. Just delete. You aren’t a victim until you click!
Then, if you think that you really might have an issue, contact your bank or financial institution directly. Nothing is so urgent that you need to know immediately. And if message did come from your bank, they know how to contact you again. Scammers lose interest if you don’t reply to them.
My advice to everyone is to READ, and then FREEZE, your credit at each of the three bureaus!
You can get a free copy of your report from each of the three bureaus by going to AnnualCreditReport.com. Or call the numbers below:
TransUnion 1-800-916-8800 www.Transunion.com
Equifax 1-800-685-1111 www.Equifax.com
Experian 1-888-397-3742 www.Experian.com
Read the report carefully, looking for unexpected accounts being reported as well as inquiries from places such as banks or government lending agencies where you have never applied for a loan or mortgage. Contact those institutions to make sure no accounts were opened in your name.
There’s no reason not to freeze your credit report, unless you are actively seeking a car loan or a mortgage, or applying for a job where a credit check is required. A freeze is free, and you can easily lift it temporarily to allow access to your report by using a PIN.
Here are the direct links to FREEZE your credit report.
Identity theft and taxes
False unemployment claims have been coming to light as people filed their 2020 tax returns this past spring. Many people have received a letter known as the 5071C letter (or other variations) from the IRS asking you to “verify” your identity.
To do that you need your personal account number from a credit card, mortgage, student loan, home equity loan or line of credit, or car loan. They also ask for a mobile phone associated with your name and your mailing address from your previous year’s tax return.
But many seniors don’t have any of the above! And they may not even have filed a tax return in previous years because of low income — and only did so in 2020 to claim the stimulus check.
The IRS says if you can’t verify your information over the phone, they will “schedule an appointment at your local IRS office to verify your identity in person.” Good luck with that! Instead, contact the IRS Taxpayer Advocate at 877-777-4778.
A last resort
Don’t panic if your identity has been stolen. But get ready for a long process. First, file a police report. That’s critical to proving your case if questions arise. Then get help restoring your credit at the Identity Theft Resource Center (www.idtheftcenter.org) or call them at 888-400-5530.
Sadly, there is no vaccination against identity theft — only serious prevention and continuous scrutiny. And that’s the Savage Truth.
(Terry Savage is a registered investment adviser and the author of four best-selling books, including “The Savage Truth on Money.” Terry responds to questions on her blog at TerrySavage.com.)
©2021 Terry Savage. Distributed by Tribune Content Agency, LLC.