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Identity Theft: How To Fight The Scam.

LENA (not her real name) couldn't wait to try out the cellular phone her sister gave her for her birthday. But when she went to the dealer to have it activated, she discovered that she already owed $600, and that the company wanted its money now!

Yet Lena had never owned a cell phone in her life. As it turns out, someone had used her personal information without her knowledge to open an account in her name and had never paid. And the real Lena was left with the bill.

Lena was unlucky; so were the people who answered the following ad:


This ad, directed at elderly African-Americans in Southern and Midwestern states, claimed that money was available to Blacks from the so-called "Slave Reparation Act." But there is no such act. The notice was meant to entice elderly Blacks into revealing personal information, such as their address, birth date and social security number. Then the thieves could get access to their credit cards or open new accounts in their names without their knowledge.

Both cases are real-life instances of identity theft, dubbed by law enforcement as the fastest-growing crime in America. Identity theft occurs when someone uses someone else's personal information, usually a social security number or credit card number, and acts as if he or she is that person. Then thieves are free to buy cameras, cell phones, jewelry and other items in person, through the mail or over the Internet. In some cases, thieves actually use your identity and apply to credit card companies, get cards with your name on them and proceed to make charges. And you are saddled with the bill.

Estimates indicate identity theft reaches 900,000 new victims a year. Some victims' accounts have been fraudulently charged for $200, others for $200,000.

In this electronic age, your finances can be damaged within a matter of seconds by this easy, popular crime. The damage to your credit can take years to undo, but if you take swift action, you have a better chance of restoring your good name and keeping your finances intact. If you haven't been a victim, guard yourself, because you never know when it can strike.

How To Know If You're A Victim

Identity theft announces itself in a variety of ways. You may get a call from your creditor, stating it suspects "unusual activity" on your account. You may receive a call from a collector, demanding payment for a stereo system you never bought. You may be denied a car loan, view the credit report and see a host of overdue bills you never knew about.

Damage Control

If you are a victim of these schemes, the quicker you take action, the better off you'll be.

First and foremost, call the police. In cases of identity theft and illegal credit card use, it's especially important to get a police report. However, some officers won't write a report. They claim that the credit card company--not the consumer--is the true victim of the fraud because it absorbs the financial losses. Be persistent, says Gregg McClain, chief of the economic fraud and environmental protection unit in the district attorney's office of San Diego. Don't leave the station without something in writing.

"What you really need is the report itself," McClain explains. "Regardless of whether the cops do anything, at least you have a copy of the report.

You can forward the report to the security division of the credit card company. At least they know it's not you [who made the purchases], since you went through the trouble of reporting it ... You've got to be able to protect yourself and say, `That wasn't me.'"

Call the three credit reporting bureaus: Trans Union, Equifax and Experian. They will place a "fraud alert" on your behalf and provide a free credit report to you. Examine the report to check other accounts.

Next, inform the creditor that fraudulent activity has occurred on your account. The creditor will freeze the old account and issue a new card and account number.

Richardo Kilpatrick, a Detroit-area attorney and president of the American Bankruptcy Institute, stresses the importance of timing. Kilpatrick, whose organization defends creditors' rights, says the longer you wait to dispute the fraud, the fewer rights you have, he says.

"If you don't do it properly, you can be responsible for the charges," Kilpatrick says. "If you let the statements go a number of months, you put them [creditors] at a disadvantage unless you give them the information to protect both you and them."

Fighting Identity Theft

The Federal Trade Commission offers several helpful tips in the fight against identity theft and consumer fraud. It encourages consumers to:

* Keep your personal information private. Don't disclose personal information, such as your address, or Social Security number, unless you know who is collecting the information and why they are collecting it.

* Read all of your bills carefully. Call creditors to dispute any charge you didn't make or authorize.

* Order a copy of your credit report each year from all three credit bureau reporting agencies to check for anything that could indicate fraud.
COPYRIGHT 2001 Johnson Publishing Co.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2001 Gale, Cengage Learning. All rights reserved.

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Article Type:Brief Article
Geographic Code:1USA
Date:Aug 1, 2001
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