It's Tuesday morning and you head out to the local pharmacy to pick up a prescription renewal.
You've been a regular customer for years, so the pharmacist and staff know you. If fact, they have the meds out for you when you get to the counter. All you need to do is sign for them and pay — you've done it many times.
Only there is a problem: The charge card reader rejects the transaction. You take out a different card. Same result.
The clerk calls the card issuer and now tells you that the card has been cancelled. You pay cash for your purchase, go home and call the card issuer. Surprise! You are told that you cancelled the card earlier that day and had a new card issued, but to your new address?
This is the start of a real-life nightmare: Identity theft. Identity theft happens whenever a thief uses another person's information in a fraudulent manner. Using stolen identity information, someone can access to your financial data, change credit information, and run up bills in your name.
A $20 billion problem
The story is repeated every day with an untold number of victims, and while the scenario above is extreme, varying degrees of identity theft are occurring at an alarming rate. According to the AARP Fraud Watch Network, identity theft occurs every two seconds of every day; about 17 million times last year alone account for over $20 billion in losses.
How does this happen? In some cases, it is the result of large-scale security breaches of corporate or government files. In these cases, personal information including names, addresses, account numbers, passwords and Social Security Numbers are stolen, used, or sold to other criminals.
In many situations, identity thieves act as imposters to gain access to your information using false identity, claiming to be IRS agents, computer technicians, or even family members. Some identity theft is even the result of personal carelessness with critical information such as account numbers, Medicare cards, credit and debit cards and other personal documents.
The fact that you are a victim of identity theft may not be immediately apparent. Some of the signals include irregularities with credit card accounts such as unknown charges or even the failure to receive a credit card bill. Denial of credit, problems with credit reports, unexpected calls from debt collectors, and even what appears to be a fraudulent address change are telltale signs.
With your identity compromised, criminals conduct a wide range of activities in your name. Bank accounts are drained or others opened for the purpose of writing bad checks in your name. Credit card accounts are opened and purchases made in your name. Your credit history is used to secure loans or purchase "big ticket" items. Even illegal activities involving drug trafficking, child pornography, or possibly arrest, take place and result in creating a criminal record in your name.
Steps to take
There are a number of steps to take if you suspect that your identity has been stolen.
The United States Federal Trade Commission recommends four specific actions.
1. Call the companies where you believe the fraud occurred to report the situation, close the accounts and change logins.
2. Contact any one of national credit bureaus (Equifax, Experian, Transunion) to obtain credit reports and place a freeze on your credit.
3. Report the identity theft to the FTC identitytheft.gov completing the online form.
4. Contact local law enforcement.
Another highly recommended step is to contact the AARP Fraud Fighter Call Center at 877-908-3360. The call center is staffed with trained volunteers who provide protection tips and contact information for law enforcement agencies.
Identity theft is devastating but not the end of the road. Taking the right steps can reduce loss and provide peace of mind.
Elliott Greenblott is the Vermont coordinator of the AARP Fraud Watch Network. Next time: Protecting yourself — fighting identity theft. The AARP is seeking fraud fighters. Join the AARP Fraud Watch Network and receive watchdog alerts and tips. It's free. Go to aarp.org/fraudwatchnetwork or volunteer by calling Vermont AARP at (866) 227-7451.