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Identity Theft Protection

Credit Monitoring and Identity Theft Protection Guide

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Theft Protection Guide

In 2017, Equifax announced that the Social Security numbers, birth dates, addresses and (in some instances) driver’s license numbers of  over 140 million people had been hacked.

This widely publicized incident caused consumers to face the serious effects of identity theft, and to think about how they could protect themselves.  In September 2018, a new federal law went into effect as a result of the breach: People can now freeze and unfreeze their credit at all three major bureaus without being charged.

Here is a summary of the best steps to take to protect yourself from identity theft. You should have a plan to:

  1. Prevent identity theft from happening with a credit freeze.
  2. Detect identity theft as soon as possible, with credit monitoring and account alerts. There are both free and subscription services available.
  3. Resolve identity theft if it does happen. You can either get help or do it yourself.

Our full identity theft guide is still below this summary.

1. Prevention

If someone has stolen your personal information, you will want to prevent people from being able to open new credit accounts in your name. You can do that by freezing your credit. A credit freeze prevents any third party from obtaining a copy of your credit report. That means that new credit accounts cannot be opened. (You can read our full credit freeze guide here).  If you want to apply for credit, you would use a pin code (generated at the time of the freeze) to un-freeze your account. Here is where to go to freeze your credit:

In addition, you will want to set up 2-factor authentication on all open accounts (especially your bank accounts or email). That means any time you want to access your account or send money, you would need to receive a text message, email, phone call or confirm via an app.

2. Detection

Even if you freeze your credit, you should have credit monitoring in place. And if your credit isn’t frozen, you definitely need credit monitoring. With credit monitoring, you will be notified as soon as someone tries to open a new account. In addition, you will be notified if new negative information hits your credit report. (Even if you have a credit freeze, someone could use your Social Security number at a hospital. That medical debt could end up with a collection agency – and on your credit report. Only with monitoring would you know.)

You can get 1-bureau monitoring for free. You have to pay for 3-bureau monitoring. Here are our recommendations:

  • Best Free (1-bureau) monitoring:

LendingTree

MagnifyMoney’s parent company, LendingTree, offers credit score monitoring in partnership with Transunion. You will be notified of any changes to your credit report, including inquiries and new account applications. You can sign up for the service here.

LendingTree

Learn more Secured

on LendingTree’s secure website


CreditKarma

With CreditKarma, you can also monitor your TransUnion credit report daily. You will be notified of any change to your credit report – including newly opened accounts, inquiries or collection items.

  • Cheapest 3-bureau monitoring: CreditSesame ($15.95 per month)

With CreditSesame you can monitor all three credit bureaus daily. This will cost you $15.95 a month, and does not include resolution services. If you are very concerned about identity theft, three-bureau monitoring could be worth the investment.

  • Set up alerts on all active accounts (free)

Most banks, credit card companies and credit unions have a feature that allows you to receive an alert (text message or email). Make sure you set these up for all accounts – especially accounts you rarely or never use. (You can read our guide to setting up alerts here.)

3. Resolution

If you are the victim of identity theft, you will need a game plan for resolution. The best place to start is IdentityTheft.gov, where you can see a full checklist of the steps to take to ensure you minimize losses and regain control of your identity.

You might want to have help with the resolution process. That is where credit resolution services come in. In a best case scenario, you give power of attorney to the company, and you will have a dedicated case worker handling everything (which can take years).

  • Cheapest resolution service: Zander ($6.75 per month)

At Zander, you are paying for “white glove” on-shore service if your identity is stolen. You will also have a $1 million insurance policy to cover any expenses associated with recovering your identity.

Bottom line

  • Freeze your credit with all three credit bureaus
  • Sign up for free one-bureau credit monitoring at CreditKarma
  • Make sure all open (existing) accounts have both alerts and dual-factor authentication enabled
  • Check your report with all three bureaus at least once a year for free at AnnualCreditReport.com
  • Sign up for credit resolution services ($6.75 a month) at Zander

If you do these things, you will have a cost-effective strategy to protect yourself. Below is our original guide. And if you have any questions, don’t hesitate to email us at [email protected]

What is identity theft?

Identity theft is any attempt by another person to use your identity for their own personal or financial benefit. Identity theft victims are protected by law, and they have the right to a full restoration of their identity, but achieving restoration isn’t always easy. It is up to identity theft victims to find and follow the recommendations of the Federal Trade Commission to achieve full restoration of their accounts, identity and good legal standing.

Identity theft manifests itself in two forms:

Account Takeover

The most common form of identity theft is an account takeover which involves another person using either your credit or debit accounts to make transactions for their benefit.

Identity Takeover

A less common form of identity theft is called identity takeover. This involves thieves using the name, social security number, or other personally identifying information to fraudulently assume their victim’s identity for their own benefit.

When it comes to identity takeover, it’s not just your credit and money that is at risk, it’s your entire identity. In worst case scenarios, you may find that your ID is filled with false medical records, false work documents, criminal charges, unpaid taxes in addition to financial and credit issues to resolve.

How does identity theft happen?

Identity theft can take place through physical and cyber channels, and nearly everyone is at risk for identity theft. Knowing the most common identity theft scams can help you take common sense steps to mitigate risk.

Account Takeover:

  • Data Breaches- Your account number gets stolen from a large corporate database along with thousands or millions of other people’s accounts.
  • Account Skimming- A thief steals your card ID and pin from an ATM or during a transaction, and uses it for purchases or to steal cash later on.
  • Stolen Cards- A thief steals your card and uses it.
  • Phishing- A cyber criminal reaches out to unsuspecting people in the hopes of obtaining account information
  • Online Hacking- Cyber criminals steal your account information when you are logged into an account on a non-secure wireless connection.
  • Unauthorized use- A friend or family member uses your card (or your ATM Pin) to make purchases without your knowledge or consent.

Identity Takeover:

  • Stolen tax documents- Thieves steal tax documents that include SSN, employment information and more from your mail, trash or digital locations.
  • Documents in your trash- Thieves steal documents with personally identifiable information from your trash or recycling bin.
  • Data Breaches- Your personal information gets stolen from a large corporate database.
  • Phishing- A cyber criminal reaches out to unsuspecting people in the hopes of obtaining personal and financial information
  • Online Hacking- Cyber criminals steal your personal information when you are not on a secure wireless internet connection.
  • Unauthorized use- A friend or family member uses your personally identifying information (such as SSN, address, and more) for personal gain.

How Can I Protect Myself?

Although it is impossible to eradicate identity theft, but each person should take steps to mitigate their risk of identity theft and the reach of consequences in the event of such theft.

Mitigating the risks and costs associated with identity theft depends on a thoughtful approach in four categories:

  • Proactively preventing identity theft
  • Monitoring your identity for fraud
  • Limiting the cost of resolution
  • Restoring your identity

You can learn more about the free and paid options for each of these categories below:

Prevention

Although it’s impossible to completely prevent identity theft, everyone can take steps to decrease their risk of being a victim.

It is particularly important to note that friends and family members are often the perpetrators of identity theft. If you are unwilling to press charges against someone, then you need to do all you can to prevent them from stealing your identity.

How do I prevent identity theft?

Account Takeover:

Criminals can find ways around even the best security, but you can take steps to make yourself a less attractive target for thieves.
Top 10 ways to decrease your risk of Account Takeover

  • Don’t give out your ATM PIN to anyone (including family or friends).
  • Use your hands to cover the pin-pad when using an ATM
  • Avoid ATMs at convenience stores or other locations that don’t have security footage
  • Password protects your phone.
  • Don’t log into bank accounts or credit card statements on public Wi-Fi.
  • Do not give out account information (online, over the phone, or in person) unless you are about to make a transaction.
  • If anyone calls to ask for your account information, do not give it out. If you suspect the call may be legitimate, call your credit card company or bank back through their secured lines.
  • Use high quality passwords for online financial accounts.
  • Change passwords for online financial accounts frequently.
  • Shred documents (including old checks) that have account numbers in them before disposing.

Identity Takeover:

Protecting yourself from identity takeover requires protecting yourself from cyber-criminals, criminals who may have access to paper documents, and from thoughtless friends and family members. Even though identity takeover is less common, it’s even more important to take protective measures against it.
Top 7 Ways to Reduce Your Risk of Identity Takeover

  • Do not give out your Social Security number to anyone unless there is a legitimate financial, tax or employment need.
  • Shred or burn documents that contain personal identifying information.
  • Do not access tax documents or tax software via public Wi-Fi.
  • Do not store your Social Security Number on your phone.
  • Freeze your credit if you suspect someone attempted to steal your identity.
  • Use anti-virus software or personal encryption software.
  • Use high quality passwords on all accounts that contain personal info.

What companies can help me prevent identity theft?

Most protective measures are free to consumers, and any company that promises full prevention of identity theft is lying. Because identity thieves constantly evolve, it is not possible to fully avoid identity theft risk.

Account takeover

Identity Guard Unfortunately, no company can completely prevent others from taking over your accounts. As long as you have digital accounts you will retain some level of risk.However, Identity Guard ($19.99 per month) mitigates risk by providing customers with password, keystroke and anti-virus protection on their personal computer. This will reduce your risk of being individually targeted for identity theft.

Identity Takeover

If you are worried about identity takeover, one low cost option you may want to consider is a credit freeze. If you are either in the process of cleaning up identity theft, or you have reason to believe that you are at a high risk for identity theft then you should consider placing a credit freeze on your account. A credit freeze prevents other people from viewing your credit history, and it prevents you and others from initiating new lines of credit.

Credit freezes  provide as much protection as any of the major identity theft insurance products that are available on the market.

Some companies can help you reduce your risk of identity takeover by adding additional security against hackers and cyber criminals.
LifeLock Advantage The premier advertiser of identity theft protection services was LifeLock who has been sued repeatedly for falsely advertising their ability to completely prevent identity theft. Since then, LifeLock has turned more toward advertising protection through monitoring.
Identity Guard Using the encryption methods explained above, Identity Guard ($19.99 per month) mitigates risk for account takeover from cyber criminals who may target personal information.

Monitoring

When it comes to identity theft, the best defense is the early detection of fraudulent activity. If you detect fraudulent activity early on, you can usually prevent full account takeovers, quickly get reimbursed for fraudulent activity, and deal with less paperwork as you unravel the effects of identity fraud. As a result, we recommend that everyone take monitoring their personal information seriously.

How do I monitor for identity theft?

Account Takeover

Since account takeover involves the fraudulent use of existing credit and debit accounts, it is fairly easy to monitor your accounts using just a few simple tricks.

  • Set up your own alerting system on all open accounts (even if you don’t use them regularly)
  • Review transactions before paying your credit card bill.
  • Pay attention to alerts from your bank or account issuer if they experience a data breach
  • Receive proactive data breach updates using identity theft protection services.

Identity Takeover

Identity takeover has both financial and non-financial components, but most monitoring efforts focus on the financial component of monitoring. This is because identity theft most commonly manifests itself through new credit accounts being opened or negative information (unpaid bills) being introduced to your credit report. The top ways to monitor for identity takeover include:

  • Annually check for fraudulent or incorrect information on savings accounts or checking accounts using the ChexSystems.
  • Pay for three credit bureau monitoring.
  • Pay for web or “dark web” surveillance that will identify if your social security number is being offered for sale.
  • Pay for change of address alerts from monitoring companies.

What companies can help me monitor for identity theft?

While no company can identify every instance of identity theft through monitoring, you may find that you are more comfortable maximizing the amount of monitoring available to you.

Identity Takeover

Identity Takeover typically manifests itself through negative credit information, so monitoring your credit report for fraudulent information, is the best way to monitor for identity theft.

In addition to the free annual credit reports, free two bureau monitoring, and free checking account monitoring, it is possible to pay to receive three bureau credit monitoring services along with the monitoring of other data that will help you identify and resolve identity theft early on.This can be a good choice if you are in the midst of dealing actively with credit card fraud, or you want some of the additional coverage from these insurance providers.

3-logos

TrueCredit ($19.95/month) and AARP also provide cost-effective monitoring of all three credit bureaus. AARP and TrustedID also provide up to $1 million in Identity Theft insurance which is a benefit explained below. FICO Ultimate 3BmyFICO ($29.95/month or $329/year) offers quarterly 3 bureau credit monitoring along with intelligent identity theft monitoring features including Black Market Website Surveillance of the sale of your identity information and Social Security number alias watch which monitors the names and addresses associated with your SSN.

Limiting the cost of resolution:

Although laws exist to limit financial loss for consumers, identity theft resolution tends to have some out of pocket costs. These costs include liability losses (limited to $50 if fraudulent charges are reported within 2 days or $500 if reported within 60 days), legal costs (ranging from $20 for notarized forms to a few thousand if you undergo legal battles), and lost wages if you have to take time off to battle the legal system.

How do I limit the costs of resolution?

Account Takeover

  • Use debit and credit cards that advertise $0 Fraud Liability
  • Report any fraudulent transactions (especially cash withdrawals) immediately.
  • Follow your bank’s process for cancelling and reissuing accounts immediately.
  • Change login IDs, passwords, and PIN codes immediately.
  • Follow these steps to report identity theft.

Typically account takeover can be resolved at no out of pocket costs to you. By alerting your issuing bank, you can typically be made financially whole (unless the theft involved ATM withdrawals using your PIN number).

Identity Takeover

  • Report identity theft right away.
  • You will need to file an identity theft affidavit and a police report.
  • Change passwords and PINs as quickly as possible.
  • Follow these steps as quickly as possible to minimize the likelihood of litigation.
  • Consider purchasing identity theft insurance which will cover the financial costs associated with identity theft resolution.

Identity takeover is much more cumbersome to resolve, but outside of litigation, the financial costs are limited. If you are worried about loss liability or potential courtroom expenses, you may want find that purchasing identity theft insurance protection will be valuable for your peace of mind.

What companies can help me limit the cost of resolution?

Account Takeover

If your account is taken over, by law your financial institution must hold you to a $0 Fraud Liability on fraudulent transactions if you still have possession of your card.

However, if your card was lost or stolen, then you have up to $50 in liability if you report the fraudulent transaction within two days, and up to $500 in liability if you report the fraudulent transaction within 60 days. After that point, your liability is limitless.

Individual PlanZander ($6.75/month or $75/year) offers resolution services at no additional cost to their customers. Additionally, they offer up to $10,000 in recovery of fraudulent electronically transferred funds if legal recourse with a financial institution has failed, and the customer has sought funds from their financial institution first.Zander will not pay out any benefit if the unauthorized transfer was made by a person using your card and your PIN if you gave them access to that information in the past.

 

Identity Takeover

Among the most prominent identity theft products, identity theft insurance promises to cover the complete cost associated with identity theft. This can include the costs of notarization, legal costs, filing costs, and even lost wages. Identity theft insurance policies can cover anywhere from $25,000- $1 Million in coverage though $25,000 should be more than sufficient for most people.

Individual PlanZander ($6.75 per month) offers resolution services at no additional cost to their customers, and up to $1 million in coverage for identity theft related losses. Additionally, they offer up to $10K in recovery of fraudulent electronically transferred funds if legal recourse with a financial institution has failed, and the customer has sought funds from their financial institution first.
Equifax ID PatrolTMEquifax ($17.95 per month) offers up to $25,000 in identity theft insurance along with 3 credit bureau monitoring services, resolution services. Although their limit is lower than the other companies, $25,000 is likely to be more than enough to pay for all the legal fees and lost wages that could occur in a worst case identity theft scenario. Their insurance does not cover recovery of unauthorized electronic funds.
Identity GuardIdentity Guard ($19.99 per month) offers 3 credit bureau monitoring and personal resolution services, and their insurance is up to $1Million. Their insurance does not cover recovery of unauthorized electronic funds.

Resolution

If you’ve been the victim of identity theft, then it is up to you to report the identity theft and restore your good name to all affected areas. This can be a time consuming task, and some companies are willing to take on the burden for you.

How do I restore my identity after I’ve been a victim of identity theft?

Account Takeover:

  • Call your credit or debit card company, cancel your existing account, and have them replace it with something new.
  • Make sure that fraudulent charges are removed and your money has been restored.
  • If instructed by your bank, file an identity theft affidavit and a police report.
  • If necessary, follow these steps to resolve identity theft according to the Federal Trade Commission.
  • If you have paid for identity theft resolution services, report identity theft to your company, so that they can complete resolution steps on your behalf.

Account takeover can usually be resolved between you and your financial institution without too much red tape or documentation required.

Identity Takeover:

  • Visit IdentityTheft.gov, a website that will walk you through all of the steps required to take back your identity. You will also be able to speak with real people. Steps include:
  • Place a Fraud Alert and Get Credit Reports
  • Report identity theft to FTC
  • File a police Report
  • Freeze your credit
  • Close fraudulent accounts
  • Repair your credit report
  • Unravel misuses of your ID for tax, work, social security, medical or other purposes.
  • Utilize resolution services from an existing identity theft resolution policy to assist or resolve issues for you.

What companies can help me restore my identity?

The average identity theft victim spends more than 30 hours unraveling the work of identity thieves in order to make themselves whole again. Several companies offer a range of identity theft resolution services that can help resolve both account takeover and identity takeover.

Resolution assistance

These companies offer resolution help, but they do not restore your identity on your behalf.

Equifax ID PatrolTMEquifax ($17.95 per month) offers resolution assistance through a members only toll-free hotline; depending on your situation, they may assign a caseworker directly to you, but it is up to you to complete all filing. Equifax has an A+ rating with the BBB, but their identity theft product had few online reviews
Identity GuardIdentity Guard ($19.99 per month) provides a toll free hotline and promises one on one service, but you are expected to do the heavy lifting associated with filing paperwork and recovery. Identity Guard has an A+ rating with the Better Business Bureau, and all complaints filed against them have been resolved. Online customer reviews showed overwhelmingly positive support.
PrivacyGuardPrivacyGuard ($19.99 per month) offers a team of fraud experts but not individualized caseworkers. The experts take on much of the burden of contacting creditors and filing paperwork. However, online reviews for PrivacyGuard showed overwhelmingly negative experiences including billing problems and poor customer service.
FICO Ultimate 3BmyFICO ($29.95 per month) provides 24/7 restoration assistance with identity theft experts, and they promise to hire lawyers, investigators and legal case managers on your behalf if you need legal help. However, some of the resolution burden continues to rest with the consumer.

Guaranteed full resolution:

These companies promise to do all the work necessary to restore your identity on your behalf.

Individual PlanZander Insurance ($6.75 monthly) is one of the top names in restoration services. They assign a US based case worker directly to your case and promise to do all the heavy lifting associated with restoring your identity. They boast a 100% success rate in identity recovery, have an A+ rating with the Better Business Bureau, and overwhelmingly positive online reviews.
IDShield FamilyID Shield ($12.95 per month) promises that a licensed private investigator will be assigned directly to your case, and provide you with complete resolution. They are not rated by the Better Business Bureau, but they have very positive online reviews.

Determining the right products for you

Best overall free strategy

  • Use AnnualCreditReport.com to review your three bureau credit report once per year.
  • Use ChexSystems to check for accurate checking and savings information once per year.
  • Use CreditKarma to access two of three credit bureau reports on a weekly basis.
  • Set up transaction alert s for open credit accounts.
  • Review debit and credit transactions at least monthly.
  • Keep your information secure and private.
  • Freeze your credit if you fall victim to identity theft.
  • Follow the FTC steps to resolve identity theft.

Cheapest way to maximize resolution

For a little more money:

    • Purchase ID Shield and receive personalized resolution services from a Kroll Private Investigator (especially helpful in complex identity takeover situations) along with single bureau credit monitoring: Total Cost $9.99 per month

Cheapest way to limit the cost of resolution

  • Purchase Zander Identity Theft Insurance and receive up to $1 million in identity theft insurance including recovery of up to $10,000 in unauthorized electronically transferred funds along with recovery services: Total Cost $6.75 per month

Best coverage Money can buy

You’ll get the most value by combining the free credit monitoring from CreditKarma and the resolution services from Zander Identity Theft Insurance — Credit Karma would alert you to a problem and Zander would help you resolve it, and Zander’s service costs $6.75 per month.However, for those who are willing to sacrifice a bit in the way of resolution services for additional monitoring, myFICO Ultimate 3B ($29.99/month) offers acceptable resolution services combined top insurance and the best monitoring services on the market.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Hannah Rounds
Hannah Rounds |

Hannah Rounds is a writer at MagnifyMoney. You can email Hannah here

Advertiser Disclosure

Credit Cards, Identity Theft Protection

When Banks Can Refuse to Refund Fraudulent Debit Card Charges

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

ATM

Typically, debit cards that are used as “credit” are offered the same protections as credit cards. This means that if you use your debit card in a store and choose “credit” instead of entering your PIN number, you should receive the same protections as if you used an actual credit card. However, we do encourage you to double check the fine print your bank provides on this matter before assuming your debit card will receive those protections.

But here’s a scenario where your debit card is riskier than your credit card. If you withdrawal money at an ATM (or any store doing cash back) using your PIN number, you have additional risk. If someone steals your pin number with a skimming device at an ATM, then he has direct access to your money. This isn’t like credit card fraud with obnoxious charges you need to dispute. This is your hard-earned cash being taken directly out of your checking account. And if you aren’t careful, you might not be able to recoup your losses.

So, what can you expect if you are a victim of debit card fraud?

Timeline for Being Able to Get Your Money Back

If you are a victim of debit card fraud, you are responsible for the following:

  • $0 if you report the loss or fraud immediately and the card has not been used,
  • Up to $50 if you notify your bank within 48 hours of your lost or stolen card,
  • Up to $500 if you notify the bank with 48 hours and 60 days of your lost or stolen card, and
  • All of the fraudulent charges if you don’t notify the bank until after 60 days.

It’s important you don’t delay in reporting the fraud to your bank if you want to be able to get all of your money back. If you were the victim of theft because the crook skimmed your info and used your PIN, then you may be on the hook for the $50 because you couldn’t report to the bank before the card was used. You didn’t know it had happened until the strange transaction showed up!

It may seem unfair to be responsible for charges that you did not actually charge yourself, but to avoid that scenario and protect yourself, consider taking the following precautionary actions.

What You Can Do To Protect Yourself

To protect yourself against debit card fraud, you should do the following:

  • Only use an ATM inside a bank (this will lesson the likelihood that a scanner is on an ATM)
  • Cover your hand when you type your pin into an ATM (to protect yourself against any devices attached to the ATM from getting your PIN)
  • Set up text alerts for each transaction over $0.01 on your card. This way you’ll be immediately alerted if a bogus charge is made
  • Monitor your bank on a regular basis (so you can give notice of fraud immediately)
  • Report stolen funds immediately (so you’re not responsible for the charges)
  • Check-in annually with your bank as to the policies regarding debit card theft (know whether your debit card is specifically protected and to what extent)

While you can notify the bank by phone, it is best to get everything in writing. For purposes of the time requirement, notice is considered given when you put the letter in the mail. It’s even better if you send the mail certified. You can, of course, send notice by mail and call. Whatever you do, keep a record of your communications you have with the bank. This will put you in the best position if you have to escalate your problem.

Remember that if you take the actions listed above, you will be more protected than you otherwise would. Even if you didn’t do anything wrong, like in the example above, you can still find yourself stuck with fraud charges that your bank won’t reverse. These specific steps will help you protect yourself, even when you’re not at fault. This is particularly important if you use your debit card frequently.

Don’t want to use a credit card? Learn how to survive with just debit cards here. 

Debit vs. Credit: How to Decide

Using a debit card forces you to keep your spending in check because you cannot spend more than you have in the bank. However, it may be riskier than using a credit card for the reasons described above. Discover, for example, now offers a Freeze It® on/off switch for your account. If you’re concerned because you’ve lost your card, you can temporarily freeze your account and Discover will not authorize new purchases, cash advances or balance transfers.

Discover it® Balance Transfer

Intro BT APR

0% for 18 months

Balance Transfer Fee

3% intro balance transfer fee, up to 5% fee on future balance transfers (see terms)*

Regular APR

14.24% - 25.24% Variable

APPLY NOW Secured

on Discover Bank’s secure website

Rates & Fees

If you’re not sure which is best for you, ask yourself what do you value more – your spending being limited or the additional protections from fraud. If you can control your spending, then you may be better off with a credit card. If you are a spender, however, then take the additional steps listed above to make sure you fully understand your specific liability in the event of debit card fraud. If you feel your bank is behaving unethically and should be refunding you, then reach out to the Consumer Financial Protection Bureau to file a complaint.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Natalie Bacon
Natalie Bacon |

Natalie Bacon is a writer at MagnifyMoney. You can email Natalie at [email protected]

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Identity Theft Protection

How to Freeze a Credit Report After Someone Dies 

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

parent death_lg

Dealing with the death of a loved one is never easy. While loss is a natural part of life and we may expect it, death often overwhelms us with shock, depression and confusion. Sadly, when you’re in this vulnerable state, there are identity thieves looking to prey on your dulled awareness. They do so by stealing the identity of the deceased and fraudulently opening credit card accounts, applying for loans and obtaining service contracts.

This concept, sometimes called “ghosting,” is a widespread problem. There hasn’t been a lot of research on the issue, but one study estimates the identities of approximately 2.5 million deceased Americans are used fraudulently each year. Of those, almost 800,000 are deliberately targeted cases.

Why it’s important to freeze someone’s credit after they die

Many identity thieves are practiced in using the dead’s information for their own financial gain. Criminals who deliberately target the departed know that it takes time for financial organizations and credit reporting agencies to process death notices and update their records, leaving open a window of opportunity for fraud.

Following the 2017 Equifax breach, people may be more aware of their credit situation than in the past. However, a survey taken shortly after the breach by CompareCards.com (which, like MagnifyMoney, is a subsidiary of LendingTree) shows that approximately 78% of people did not freeze their credit after the breach. People are largely aware of the negative impact that identity theft can have, but a large portion of the American population neglects to take the next steps necessary to protect themselves.

Luckily, the steps to take to protect your loved one’s identity are clear and relatively simple to follow.

How to report a death to the credit bureaus

The Social Security Administration (SSA) states that, in most cases, the funeral director will notify the administration of a person’s death. To ensure this, you must give the deceased’s Social Security number to the funeral director. From there, credit reporting agencies and lenders will be informed of the person’s passing, and they’ll automatically put a death notice or alert on their credit.

To expedite the process, it is suggested that loved ones who are close to the deceased (typically a spouse or child) take matters into their own hands to get a death notice placed on their departed family member’s credit reports at the three major credit bureaus — Equifax, Experian and TransUnion. This will involve submitting a death certificate, and the Identity Theft Resource center recommends requesting 12 copies of the certificate for such purposes (some institutions may require an original, rather than a photocopy).

Carrie Kerskie, an identity theft expert and director of the Identity Fraud Institute at Hodges University, says you should contact the credit bureaus, but knowing the right verbiage is key. “Instead of requesting a freeze, one would request a death alert,” she said. “It is similar to a freeze, except a freeze could be lifted with a PIN. A death alert cannot.”

The easiest way to update that person’s credit account is to have a relative or executor send letters to each of the three credit national reporting agencies.

The writer should include the following information about the deceased in their letter:

  • Legal name
  • Social Security number
  • Date of birth
  • Date of death
  • Copy of death certificate or letters testamentary

They’ll also want to include:

  • The letter-writer or executor’s full name
  • Their address for sending final confirmation
  • Proof you’re the executor, if applicable

David Blumberg, director of public relations for TransUnion, said, “Our industry policy is that the receiving credit reporting company will notify the other two, so they can update their records as well.”

Still, to be safe, mail this information to each of the three credit reporting agencies. Their mailing addresses are:

TransUnion
P.O. Box 2000
Chester, PA 19016

Experian
P.O. Box 2002
Allen, TX 75013

Equifax
P.O. Box 105139
Atlanta, GA 30348-5139

Kerskie advises that people going through this process prepare to provide proof of relationship along with the death certificate they’re submitting. “This could be a marriage license or court papers,” she said.

What’s the fastest option?

When speed is of the essence in beating potential fraudsters, mailing is certainly not your fastest option. Experian offers a solution: Submit the death certificate and death notice request online by uploading the documents directly to its system. Once it receives the information, Experian will add the deceased indicator and permanently remove the person’s name from any future mailing lists for preapproved offers.

Equifax also offers two speedier options – email a copy of the death certificate to [email protected] or fax your records to (888) 826-0727. It should be noted that email isn’t a secure way to submit this personal information (especially in light of the fact that you’re working to prevent identity theft).

While TransUnion doesn’t have a streamlined online tool or fax offering, they do advise family members or executors to call (800) 680-7289 for more assistance. If you need any help requesting that a death alert be placed on a deceased’s account, your first action should be to contact the bureaus directly.

Other things to do besides reporting the death

Although going through the process of contacting credit reporting agencies may seem like a hassle, your to-do list doesn’t end here. In addition to notifying the credit bureaus of the death, you should also request a copy of the person’s credit report. The Identity Theft Resource Center provides a form you can use to request the reports. This will help you to better understand what accounts are open, and it can help you spot suspicious activity. Should you face the worst-case scenario and your loved one’s identity is stolen, this will also help you to prove any charges the thieves incur.

Additionally, while it’s common for funeral directors to assist you in reporting a loved one’s death to the Social Security Administration, it behooves you to ensure this has been done. The easiest way to contact the SSA is online, but you can also call them toll-free at (800) 772-1213 or at their TTY number, (800) 325-0778.

Other items for your list:

  • Be proactive and let the deceased’s various financial institutions and account holders know about their death. Reach out to banks, insurers, brokerages, lenders, mortgage companies and credit card companies by mailing them copies of the death certificate. Kerskie recommends sending these items by certified mail and requesting a return receipt to ensure the safety of the personal information you’re sending.
  • Limit the amount of personal information released to the public. Identity thieves often gain access through obituaries that list dates of birth, death, full legal names and addresses.
  • Consider changing the deceased’s address to forward to another loved one’s home or an executor’s place of business. Identity thieves sometimes steal personal information out of a deceased person’s mail box.
  • Don’t forget to file the deceased’s final tax return.

How to resolve identity theft of a deceased person

Resolving identity theft of a deceased person follows many of the same steps you would proactively take to prevent it: Request a copy of the credit reports from the three major credit bureaus, request a death notice on that person’s credit and notify creditors of the person’s death. If fraud has occurred, there’s an extra step: The Identity Theft Resource Center advises you to contact the police in the jurisdiction of the deceased with evidence of fraud. This might be a collection notice you’ve received on the deceased’s behalf, or a credit report showing fraudulent activity.

It’s important to remember that you should not be held accountable for fraudulent debt that’s racked up in the name of your deceased relative. While this may not provide any emotional consolation as you’re going through this process, it should help to relieve some of the money-related stress you’re experiencing.

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Dave Grant
Dave Grant |

Dave Grant is a writer at MagnifyMoney. You can email Dave at [email protected]