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Identity Theft

Follow Up On Resolving Your Long Term Credit Problems

Don't expect it to be easy. The messes made by identity thieves can be time consuming and frustrating to clean up. Fortunately, there are federal laws that outline procedures for correcting credit report and billing errors, and for stopping debt collectors from harassing you about debts you don't owe.

Your Credit Report

The Fair Credit Reporting Act (FCRA) establishes procedures for correcting mistakes on your credit record. Under the FCRA, both the credit bureau and the organization that provided the information to the credit bureau, such as a bank or credit card company, are responsible for correcting inaccurate or incomplete information in your report. To protect your rights under the law, contact both the credit bureau and the information provider (creditor).

Step One

The Credit Bureaus

You've made the initial call to each credit bureau and have received a copy of your credit report from them. Examine each report closely to determine what information is incorrect. Contact each credit bureau in writing. In addition to providing your complete name and address, clearly identify each item in your report that you dispute, give the facts and explain why you dispute the information, and request deletion or correction. Enclose a photocopy of your report with circles around the items in question. Include photocopies (NOT originals) of documents that support your position. Send your letter by certified mail and return receipt so you can document what the credit bureau received and when. Click here for a sample credit bureau dispute letter. Keep photocopies of your dispute letter and all enclosures.

Credit bureaus must investigate the items in question, normally within 30 days (unless they consider your dispute frivolous). They must forward all relevant data you provide to the information provider (creditor). The information provider must also investigate and review all relevant information provided by the credit bureau and report the results back to the credit bureau. If the information provider finds the disputed information to be inaccurate, it must notify any nationwide credit bureau that it reports to so that the credit bureaus can correct this information in your file.

A few things you should know about credit bureaus:

  • Disputed items that can't be verified must be deleted.
  • Erroneous information must be corrected.
  • If an item is incomplete, the credit bureau must complete it. For example, if your file shows that you have been making late payments, but fails to show that you are no longer delinquent, the credit bureau must show that you are current.
  • If your file shows an account that belongs to someone else, the credit bureau must delete it.

When the investigation is complete, the credit bureau must give you written results and a free copy of your report if the dispute results in a change. If an item is changed or removed, the credit bureau cannot put the disputed information back in your file unless the information provider verifies its accuracy and completeness, and the credit bureau gives you a written notice that includes the name, address and phone number of the information provider.

In order to protect yourself, it is a good idea to ask the credit bureaus to do the following. They must act upon your requests:

  • Send notices of corrections to anyone who received your report in the past six months.
  • Job applicants may have a corrected copy of their report sent to anyone who received a copy during the past two years for employment purposes.
  • If an investigation does not resolve your dispute, ask the credit bureau to include your statement of the dispute in your file and in future reports.

Step Two

Your Creditors

To protect your rights under the law, contact all creditors or other information providers - in addition to the credit bureaus - in writing. Use the information you gathered to send to each credit bureau to send to your creditors. Again, include photocopies (NOT originals) of documents that support your position. Note that many information providers use a separate address for disputes, so make sure you send your correspondence to the correct address. Click here for a sample creditor dispute letter.

If the information provider reports the disputed item to any credit bureau, it must include a notice of your dispute. If the disputed information is found to be inaccurate, the information provider may not use it again. When negative information in your report is accurate, only the passage of time can assure its removal. Accurate negative information will generally stay on your report for 7 years. There are certain exceptions:

  • Bankruptcy information may be reported for 10 years.
  • Credit information reported in response to an application for a job with a salary of more than $75,000 has no time limit.
  • Credit information reported because of an application for more than $150,000 worth of credit or life insurance has no time limit.
  • Information about a lawsuit or an unpaid judgment against you can be reported for seven years or until the statute of limitations runs out, whichever is longer.
  • Criminal convictions can be reported without any time limit.

Specific Credit Card Issues and Protections

The Truth in Lending Act limits your liability for unauthorized credit card charges in most cases to $50 per card. The Fair Credit Billing Act establishes procedures for resolving billing errors and/or fraudulent charges on your credit card accounts.

To take advantage of the law's consumer protections, you must:

  • Write to the credit card company at the address given for "billing inquiries." Include your name, address, account number and a description of the billing error, including the amount and date of the error. Click here for a sample creditor dispute letter.
  • Send your letter so that it reaches the credit card company within 60 days after the first bill containing the error was mailed to you. If the address on your account was changed by an identity thief and you never received the bill, your dispute letter still must reach the creditor within 60 days of when the creditor would have mailed the bill. This is why it's so important to keep track of your billing statements and immediately follow up when your bills don't arrive on time.
  • Send your letter by certified mail and request a return receipt. This will be your proof of the date the credit card company received the letter. Include photocopies (NOT originals) of sales slips or other documents that support your position. Keep a photocopy of your dispute letter and all enclosures.

The credit card company must acknowledge your complaint in writing within 30 days, and must resolve the dispute within two billing cycles (but not more than 90 days) after receiving your letter.

NOTE: You will not receive the protections outlined above if you do not act within the stated time frames.

ATM Cards, Debit Cards and Electronic Fund Transfers

The Electronic Fund Transfer Act provides consumer protections for electronic transactions. It also limits your liability. It's important to report lost or stolen ATM and debit cards immediately because the amount you can be held responsible for depends on how quickly you report the loss.

  • Within two business days: your losses are limited to $50.
  • After two business days, but within 60 days after a statement showing an unauthorized electronic fund transfer: up to $500.
  • More than 60 days: no protection.

Note: VISA and MasterCard voluntarily have agreed to limit consumers' liability for unauthorized use of their debit cards in most instances to $50 per card, no matter how much time has elapsed since the discovery of the loss or theft of the card.

Again, call the financial institution and follow up in writing by certified letter, return receipt requested so you can prove when the institution received your letter. Keep a photocopy of the letter you send and all enclosures for your records.

After notification, the institution normally has 10 business days to investigate. The financial institution must tell you the results of its investigation within three business days after completing it and must correct any error within one business day after determining that an error has occurred. The institution may take up to 45 days to complete the investigation, but only if the money in dispute is provisionally returned to your account and you are notified promptly of the credit. At the end of the investigation, if no error has been found, the institution may take the money back if it sends you a written explanation.

NOTE: You will not receive the protections outlined above if you do not act within the stated time frames.

Bad Checks

Hopefully, you've stopped payment on your outstanding stolen checks. If some slipped through the cracks and you've begun receiving notices, what should you do?

You will probably receive two types of "bad check" notices; one from your credit union, and one from the merchant. The merchant will contact you based on the contact information printed on your check. Each merchant notice will contain information regarding the bad check, the amount, the check number, the date written, the fee, and a reference number. There is also a contact number for the check recovery service. Call the check recovery service and ask to speak to someone in the fraud department. Provide them with the reference numbers on the checks, tell them you are a victim of identity theft, and that the checks involved were not written by you.

IMPORTANT- Ask to have copies of the disputed checks faxed or mailed to you.

Ask the check recovery service what you need to provide as proof that you are a victim of identity theft. You will probably be asked to provide the following:

  • Affidavit of fraud - ask the check recovery service for one of these to complete.
  • Photocopy of the police report.
  • Photocopy of your driver's license.
  • Statement from your financial institution confirming that you closed your account because of stolen checks, and that your signature does not match those on disputed checks. You must provide copies of the disputed checks for a signature match. Most financial institutions will have your signature on file.

Send these packets (affidavit of fraud, police report, driver's license, & bank statement) to all of the check recovery services specified on the returned check notices.

  • Check Rite: (800) 766-2748
  • Chex Systems: (800) 428-9623
  • CRA Security Systems: (800) 486-0955
  • CrossCheck: (800) 843-0760
  • Equifax Check Services: (800) 437-5120
  • International Check Services: (800) 526-5380
  • National Check Fraud Service: (800) 571-2143
  • SCAN: (800) 262-7771
  • TeleCheck: (800) 710-9898 or (800) 927-0188

REMEMBER - Keep photocopies of everything you do, send all correspondence via certified mail with return receipt, and take notes on all of your telephone conversations.

If any check recovery service chooses not to cooperate with you, you may want to escalate your complaint to the proper authorities. Start with your State Attorney General's Office, the Federal Trade Commission ((877) IDTHEFT), and finally the Privacy Rights Clearinghouse ((619) 298-3396). You will probably continue receiving returned check notices for some time. Do not pay any of the disputed charges and continue to follow up with the check recovery services.

Debt Collectors

The Fair Debt Collection Practices Act prohibits debt collectors from using unfair or deceptive practices to collect overdue bills that a creditor has forwarded for collection.

You can stop a debt collector from contacting you by writing a letter to the collection agency telling them to stop, or by telling them that you do now owe the money. Include photocopies of documents that support your position. If you're a victim of identity theft, including a photocopy (NOT original) of the police report you filed may be particularly useful. Once the debt collector receives your letter, the company may not contact you again - with two exceptions: they can tell you there will be no further contact and they can tell you that the debt collector or the creditor intends to take some specific action.

Writing the collection agency will not necessarily get rid of the debt itself, which may still turn up on your credit report. A collector can renew collection activities if you are sent proof of the debt.

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