Part 1 of this series describes synthetic identity theft and part 2 explains why it is a challenge for consumers to determine if they have been victimized by this type of ID theft. Part 2 also discusses why one that commits synthetic identity theft might not be charged under current identity theft laws. In this final part of the series, we discuss the steps that consumers can take to prevent identity theft and how to detect if they become a victim of synthetic identity theft.
Don’t give up on credit monitoring services or checking your credit reports or both. One credit-reporting agency said they provide monitoring alerts based on the use of the SSn and not the name associated with the SSn. Another said that any account a person opens in a name different than yours would appear on your credit report. It is likely that because of the dominance of synthetic identity theft and because of the significant financial losses that businesses suffer, estimated at more than $50 billion annually, that the credit reporting agencies will be improving fraud detection based on SSn regardless of the name that is used with the SSn.
Credit monitoring can provide two other important benefits to you today. It can provide alerts for true name identity theft, and it provides alerts of credit derogatories, for example late payments, bankruptcies, and collections, etc. These alerts of derogatories may be valid, they may be a result of true name or synthetic identity theft, or they may be errors. Regardless of how they originate savvy consumers will want to know when and if derogatories appear and take appropriate and immediate action because deragatories decrease your credit score. The credit score reflects your financial credibility, which in turn affects your ability to get preferred rates on credit, loans and insurance.
If derogatories are placed on your credit report or detected by credit monitoring that are errors, you will want to contact the credit-reporting agency as soon as they are detected and have them corrected. Otherwise, the errors can cause you to pay higher interest rates on loans, have credit applications denied and even result in the denial of employment. (see service with best value.)
Consumers must also be alert and look for clues of true name and synthetic identity theft regardless if they check their credit report manually or they subscribe to credit monitoring. Consumers must remain vigilant and look for clues. You can look for clues when reviewing your credit reports (www.annualcreditreport.com), for example, do you recognize all of the credit accounts and are there any other names associated with your credit report other than yours, for example Jane Smith (assuming you are not Jane Smith).
Look for clues when reviewing your annual Social Security statement. If your W-2 earnings were $40,000 last year and your annual statement says you earned $400,000 that’s a clue that one or very likely more people are using your SSn for employment.
Review your Medical Information Bureau report annually (www.MIB.com), and you also have access to an annual copy of the LexisNexis Full File Disclosure Report. Generally, data warehouser LexisNexis (formerly ChoicePoint) will show other names that are associated with your SSn. If you see names other than your own on your report, you may be a victim of synthetic identity theft.
There is no charge for any of these aforementioned reports and you are entitled to one each during a 12-month period.
Additionally, most all of the standard advice given to consumers to prevent identity theft applies to preventing synthetic ID theft such as:
- Protect your personally identifiable information, especially your SSn
- Limit the identification you carry in your wallet or purse, and do not carry anything that displays your SSn
- Shred documents containing personally identifiable information before you dispose or recycle them
- Monitor your credit reports regularly as discussed in this article
- Beware of social engineering scams involving the telephone, mail, the internet or face-to-face contacts. Social engineering occurs when scammers are manipulate you into disclosing sensitive information such as your SSn or accounts numbers--either credit cards or banking.
Identity theft is not going away anytime soon, and new twists on this age-old crime continue to evolve.
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