If you’ve ever had your credit card number stolen or found unauthorized activity on one of your financial accounts, you know what a headache financial fraud can cause. A 2016 study found that 13.1 Americans became the victims of identity theft in 2015, costing them $15 billion. Over the past six years, fraudsters have stolen over $110 billion from U.S. consumers.1
One of the best ways to prevent identity theft from causing you financial damage is to spot it early. Here’s how:
You check your credit report and find an account you don’t recognize.
Checking your credit report annually or signing up for a credit-monitoring service (free for customers of some financial institutions) is one of the best ways to quickly spot identity theft. Ask your credit card company or bank if they offer customers free credit monitoring.
You check your credit card statement and see transactions you didn’t make. Checking your statements regularly can help you identify fraud and errors. If you see a small charge you don’t recognize, don’t brush it off as unimportant. Fraudsters often charge a small amount to test whether a stolen credit card number is still valid.
You receive notification of suspicious activity from your financial institution. If you have signed up for fraud alerts, your bank or credit card company may notify you of transactions that don’t match your usual pattern of usage. If you receive a message or phone call, be sure to respond immediately and check your other accounts for similar activity. Contesting fraudulent transactions is key to limiting the financial fallout.
Bills stop coming. If you’re used to receiving paper or emailed statements from your credit card company, utility provider, cell provider, or insurance company, be wary if you stop getting them. One way identity thieves cover their tracks is by changing the mailing address on an account or discontinuing paper statements.
You are declined for a loan. Unfortunately, many consumers don’t find out that they’ve been victimized until they discover that their credit has been tanked by fraudulent activity. If you apply for a loan and are denied for bad credit, immediately check your credit and begin the dispute process for any fraudulent accounts.
Identity theft and financial fraud can be very expensive and time-consuming to fix. Spotting the warning signs and acting quickly can help minimize the damage. If you believe that you have been the victim of identity theft, immediately contact the three credit reporting agencies and your financial institutions. You may also have to file a report with your local police department.