Dealing With Identity Theft by a Friend or Relative

Distressed woman reviewing documents over a laptop
••• Mike Kemp/Blend Images/Getty Images

Identity theft isn’t always perpetrated by a mystery person or an unnamed hacker. Many times, when your identity is stolen, it is taken by a friend or a relative. In fact, in 2014, approximately 550,000 identity theft and fraud victims reported it was tied to someone they knew.

Getting your identity stolen is hard enough. You may feel violated, betrayed, and your trust may be broken. You may find it difficult to trust anyone again. These are valid feelings.

But when that person is your family or a friend, it gets more complicated. You may have a hard time turning that person in or filing a police report, because of the ramifications it may have for that person or your other family members. Siblings or parents may also apply pressure to let the matter go. It can be even trickier when your spouse steals your identity.

Here’s how to deal with it if you have your identity stolen by a friend or relative.

What Is Identity Theft?

Identity theft occurs when someone uses your identity for their own financial gain. It can be to qualify for a loan, make a purchase, or to get approved for a credit card, among other reasons. Parents may not think that using their child’s information for financial gain is wrong, but that is also a form of identity theft. Here are some examples:

  • A family member uses your name and Social Security number to qualify for a credit card or loan
  • A parent uses a child's name and Social Security number to sign up for utilities or cable
  • A cousin uses a family member's name and Social Security number to qualify and sign for a lease
  • A spouse uses your name and income without your permission to open an account without your knowledge

Often, you won't know this is happening until they've gone delinquent on the account or if you have too much outstanding debt under your name. Regardless of whether it's gone into collections, identity theft is a crime that needs to be corrected.

What Can I Do If My Identity Has Been Stolen?

You will need to contact the creditor and business and explain that you are not responsible for the debt. You should also file a police report. This is the only way that you will be able to fix your credit report. You should also place a fraud alert with the credit bureaus and report the theft to the Federal Trade Commission (FTC).

Although it may be difficult to file a police report on someone you know, it’s a must in this situation, especially if they have jeopardized your financial future.

What If Other People Do Not Want Me to File a Police Report?

If you are receiving pressure from other friends or family members not to file a police report, you have to remember what's at stake if you don't report the theft.

Your credit history is in jeopardy, and you will be the one responsible for repaying that money unless you take the necessary steps to begin disputing the charges. If the person gets away with the theft, you could put others at risk as well. How do you know they won't steal someone else's identity?

What Else Do I Need to Do to Protect Myself?

You may need to change your checking account number, as well as close all of the accounts that you have open. Take the time to set up alerts on your credit reports. This will help to protect you from identity theft in the future.

If your credit cards are stolen, you are at a greater risk of having your identity stolen, so you should carefully monitor these, as well. Monitor your credit report by pulling a copy every few months. You can do this for free by rotating through each of the three major credit bureaus every four months. Many banks and credit cards now offer free credit report tracking as well.

How Do I Deal With My Family After This Happens?

Keep in mind that identity theft is not your fault, and you didn’t do anything wrong. You may also be dealing with residual feelings of betrayal regarding this person. Take the time to seek advice on how to communicate with them, what boundaries you need to set up, and whether it's even possible to maintain a relationship.

In the meantime, be more cautious about how you share information with family members and find ways to keep your personal information private.

Updated by Rachel Morgan Cautero.

Article Sources

  1. CNBC. "Don’t Trust Family Members With Your Credit Card." Accessed March 11, 2020.

  2. IdentityTheft.gov. "What To Do Right Away." Accessed March 11, 2020.