One of the scariest and most infuriating moments in your life may occur when you realize "Someone has opened a credit card in my name" and this person has maxed it out and left your credit history in a shambles.
You might have learned about the fraudulent card after checking your credit report because your application for a credit card or another loan was turned down. You then might have realized there was a past-due balance on an account you weren't even aware of.
If someone has opened a credit card in your name without your permission—an example of identity theft—there are steps you must take to clear up the problem and restore your good credit.
Reporting the Fraud to the Card Issuer
Find out the name of the credit card issuer for the unauthorized account and contact the company's fraud department to have the account closed or frozen. You can get the credit card issuer's name from your credit report and then go to the card issuer's website to get contact information. Let the card issuer know the account isn't yours and tell them you will be able to send them reports confirming the identity theft if they need them. You should also immediately change any password or PIN for your account.
Under federal law, the most amount of money you can be held responsible for when there are unauthorized charges on a credit card is $50.
Placing a Fraud Alert
Contact one of the three major credit bureaus—Equifax, Experian, and TransUnion—to place a one-year fraud alert in your file. The company you contact must notify the other two.
The fraud alert will make it more difficult for the person who stole your identity to open new credit accounts in your name. Once the alert is in place, a business will have to contact you to verify you requested the additional source of credit.
The credit bureaus should each send you a letter confirming the fraud alert is in effect. You will be able to renew the fraud alert after the initial year is up if you choose.
Checking Your Credit Report
It's possible the thief opened up additional accounts in your name. Checking your credit reports at all three of the credit bureaus is the best way to find out whether that's the case.
You don't have to pay for a credit report if you're looking for instances of fraud. If you've been the victim of identity theft, you’re automatically entitled to a free credit report from all three credit bureaus. To request the reports, follow the instructions in the confirmation letters you receive.
Review the reports carefully for unauthorized accounts or transactions and take notes on them to use when filing an identity theft report with the Federal Trade Commission (FTC) and when asking your local police department for a report.
Completing an Identity Theft Report
To file an identity theft report with the FTC, you can fill out the online form or call 877-438-4338. IdentityTheft.gov, which is run by the FTC, will create your report and offer you a recovery plan.
Filing a Police Report
Take the FTC's report with you to the police department, along with a form of identification, proof of your address, and any evidence you have that your identity was stolen. Ask to file a report of identity theft, and once it's completed, ask for a copy.
Contacting All Businesses
Now that you have your FTC and police reports, you should contact the fraud department of any businesses at which the person who stole your identity opened an account or charged you for products or services. Ask them to close the account or remove the charges.
Ask the businesses to send you a letter confirming that you are not responsible for any accounts or charges that resulted from the identity theft and that they have been closed or removed.
Keep each of these confirmation letters in a secure place just in case one of the fraudulent items reappears in a credit report.
Take note of the person you spoke with at each of the businesses and the date of the contact.
If you are asked to fill out a dispute form, this sample letter from the FTC can give you an idea of the wording to use.
Recontacting the Credit Bureaus
You should now contact all three credit bureaus in writing and ask them to block all parts of your credit report that resulted from the identity theft. Blocking the fraudulent credit items means they will no longer appear in your credit report.
The credit bureaus must comply with your request so long as you provide them with a copy of your FTC identity theft report. You should also include proof of your identity. This sample letter from the FTC can assist you.
Protecting Your Credit
To protect your credit from future attacks, you may request an extended fraud alert that lasts for seven years or opt for a credit freeze that stops anyone from accessing your credit reports until you temporarily lift the freeze. You must contact each credit bureau individually to initiate either of those actions.
You can not be charged for initiating, lifting, or reinstating an extended fraud alert or credit freeze.
Continually monitoring your credit—by ordering your free annual credit reports through AnnualCreditReport.com or from the credit bureaus themselves—is essential to catching and clearing up additional instances of identity theft before they can prevent you from getting a mortgage or car loan or a new credit card.