Monday, August 20, 2007

ID Theft Expected To Increase Because of New Law

Arizona passed a new law recently that should make most of us jump for joy. In order to get hired for a new job, employers have to search for your social security number in a federal database, and it has to match up with your name. This will probably have the effect of having fewer illegal immigrants get jobs, because right now it's quite easy to come up with fraudulent documents. This law goes into effect on January 1st.

That's the good news. However, the unintended consequence of this new law is that there may be more incidences of identity theft as a result of this law. People that want to work either have to do one of several things: work in another state, work under the table, or steal someone's identity. Working under the table will probably happen less often, because the penalty for hiring someone this way is quite stiff. They could lose their business license on the second offense.

So if you live in Arizona, make sure that you check your credit regularly. The AZ Republic, which had an article about identity theft in Sunday's newspaper, had a really good suggestion that I had never though of: instead of getting all three free credit reports at once, get your credit reports at different times of the year, and stagger them. That way you have less time between the times you check it. Don't forget to check your children's credit reports as well. My children have fairly unusual names so it's not as likely that people will want to use them, but you never can be too careful. Since this whole ID theft thing became common, I decided to check theirs at the same time I check mine and dh's.

One last thing I feel I should add: if you do have your identity stolen, you can clear it up. You don't need to hire anybody to do it for you, you can do it yourself. Some companies offer identity theft insurance... it isn't necessary, but whether you get it or not depends on you. Could you be organized enough to send out letters and follow through on them? Would you be willing to spend the time to write letters to creditors to clear up your identity? A few years ago, I did some work to repair my credit. There were some items that didn't belong on my credit report, some addresses on there where I had never lived, etc. I was able to get all the questionable items off my credit report, and so could you. I did have to send off a few Certified, Return Receipt Requested envelopes, which cost a little money, but not as much as it would cost me to pay for identity theft insurance for any meaningful time period. It took a little organization: I kept a portfolio with all my credit correspondence in it, I kept photocopies of all the letters I sent and all of my return receipt stubs. I followed up on people that did not respond. It wasn't that hard. If you need more information about clearing up credit for any reason, I recommend that you visit Creditmania.com. It is a very helpful resource, with sample letters and people that are willing to help answer your questions.

4 comments:

A. Van Gogh, Licensed Associate said...

Your article is quite imformative, but to tell others they can fix their own identity theft issues without paying a service, is a misconception at best. You have only discussed financial theft and that's not the only theft that's going on today. So, for your readers, I would ask you, do you know if someone, anywhere in the world is using your social security number? Your medical insurance information? Your DMV record? I do! And for $13/mo. I'll know within 24hrs. whether my identity has been stolen and will have private investigators to handle the details in restoring my identity. Can you do that with a free credit report?

Brooke Lorren said...

$13 a month for something that is not a necessity is a LOT of money for some people. I would agree that it can be a good deal for people who have extra cash but don't really have the time to deal with bureaucratic hassles. It does take some work to clear up identity theft, and if someone has that kind of money lying around, it may be worth it to them in order to have peace of mind or to potentially save a lot of time later.

I certainly wouldn't put credit monitoring above paying for necessities like groceries, transportation, and a place to live. I would also put health insurance or even life insurance at a higher priority.

Andi said...
This comment has been removed by the author.
A. Van Gogh, Licensed Associate said...

I would agree that you have to decide what your priorities are, but I promise that if your identity IS stolen, it'll cost a lot more that $13/mo! 1 in every 4 people have their identity stolen. On average, it takes an individual 80 hours to resolve a personal identity theft crisis and that's just in one state, and over $1600 to try and resolve it themselves. I pray you never experience what some of my clients have. Nevertheless, I was just informing your readers that a free credit report won't protect their identity. Take care.