Resolving Credit Problems
While resolving credit problems resulting from identity theft can be time-consuming and frustrating, the good news is that there are procedures under federal laws for correcting credit report and billing errors, and stopping debt collectors from contacting you about debts you don't owe.
This page briefly summarizes basic rights and what you can do to clear up credit problems that result from identity theft.
Note: This information has been provided care of the United States Federal Trade Commission (FTC). Many of the references refer to American institutions. However, much of the advice remains the same for other regions. Consult your local government authority for information about the laws in your area.
The United States Fair Credit Reporting Act (FCRA) establishes procedures for correcting mistakes on your credit report and requires that your report be made available only for certain legitimate business needs.
Under the FCRA, both the credit bureau and the organization that provided the information to the credit bureau (the "information provider"), 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. It's very important to follow the procedures outlined below. Otherwise you won't have any legal recourse if you have a future dispute with the credit bureau or an information provider about inaccurate information that should be blocked from your report.
First, call the credit bureau and follow up in writing. Tell them what information you believe is inaccurate. Include copies (NOT originals) of documents that support your position. In addition to providing your complete name and address, your letter should 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. You may want to enclose a copy of your report with circles around the items in question. Your letter may look something like the sample below. Send your letter by certified mail, return receipt requested, so you can document what the credit bureau received and when. Keep copies of your dispute letter and enclosures.
The credit bureau's investigation must be completed within 30 days (45 days if you provide additional documents). If the credit bureau considers your dispute frivolous (which may mean it believes you didn't provide enough documentation to support your claim), it must tell you so within five business days. Otherwise, it must forward all relevant documents you provide about the dispute to the information provider. The information provider then must investigate, review all relevant information provided by the credit bureau, and report the results to the credit bureau. If the information provider finds the disputed information to be inaccurate, it must notify any nationwide credit bureau to which it reports, so that the credit bureau can correct this information in your file. Note that:
- Disputed information that cannot be verified must be deleted from your file.
- If your report contains erroneous information, the credit bureau must correct it.
- If an item is incomplete, the credit bureau must complete it. For example, if your file shows that you have been late making payments, but fails to show that you are no longer delinquent, the credit bureau must show that you're 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 the written results and, if the dispute results in a change, a free copy of your report. 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.
If you ask, the credit bureau must send notices of corrections to anyone who received your report in the past six months. Job applicants can 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 a 100-word statement of the dispute in your file and in future reports.
Second, in addition to writing to the credit bureau, write to the creditor or other information provider to tell them that you dispute an item. Again, include copies (NOT originals) of documents that support your position, like your police report and the ID Theft Affidavit. Many information providers specify an address for disputes. If the information provider then reports the disputed item(s) to a credit bureau, it must include a notice of your dispute. If you're correct that the disputed information is not inaccurate, the information provider may not use it again.
For more information, see How to Dispute Credit Report Errors and Fair Credit Reporting , from the FTC at www.consumer.gov/idtheft .
In most cases, the Truth in Lending Act limits your liability for unauthorized credit card charges to $50 per card. The Fair Credit Billing Act (FCBA) establishes procedures for resolving billing errors on your credit card accounts. This includes fraudulent charges on your accounts.
To take advantage of the law's consumer protections, you must :
- Write to the creditor at the address given for "billing inquiries," not the address for sending your payments. Include your name, address, account number and a description of the fraudulent charge, including the amount and date of the error. Your letter may look something like the sample below.
- Send your letter so that it reaches the creditor within 60 days from when the first bill containing the fraudulent charge 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 bill would have been mailed to you. 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, return receipt requested. This will be your proof of the date the creditor received the letter. Include copies (NOT originals) of sales slips or other documents that support your position. Keep a copy of your dispute letter.
The creditor must acknowledge your complaint in writing within 30 days after receiving it, unless the problem has been resolved. The creditor must resolve the dispute within two billing cycles (but not more than 90 days) after receiving your letter.
For more information, see Fair Credit Billing and Avoiding Credit and Charge Card Fraud , from the FTC at www.consumer.gov/idtheft .
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. 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.
A collector also may not contact you if, within 30 days after you receive the written notice, you send the collection agency a letter stating you do not owe the money.
Although your letter should stop the debt collector's calls and dunning notices, it 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're sent proof of the debt. So, along with your letter stating you don't owe the money, include copies of documents that support your position.
If you're a victim of identity theft, include a copy (NOT the original) of the police report. If you don't have documentation to support your position, be as specific as possible about why the debt collector is mistaken.
The debt collector is responsible for sending you proof that you're wrong. For example, if the debt in dispute originates from a credit card you never applied for, ask for the actual application containing the applicant's signature. You can then prove that it's not your signature on the application. In many cases, the debt collector will not send you any proof, but will instead return the debt to the creditor.
For more information, see Fair Debt Collection from the FTC at www.consumer.gov/idtheft .
ATM Cards, Debit Cards and Electronic Fund Transfers
The Electronic Fund Transfer Act provides consumer protections for transactions involving an ATM or debit card or any other electronic way to debit or credit an account. It also limits your liability for unauthorized electronic fund transfers.
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.
- If you report your ATM card lost or stolen within two business days of discovering the loss or theft, your losses are limited to $50.
- If you report your ATM card lost or stolen after the two business days, but within 60 days after a statement showing an unauthorized electronic fund transfer, you can be liable for up to $500 of what a thief withdraws.
- If you wait more than 60 days, you could lose all the money that was taken from your account from the end of the 60 days to the time you reported your card missing.
The best way to protect yourself in the event of an error or fraudulent transaction is to 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 copy of the letter you send for your records.
After receiving notification about an error on your statement, the financial institution generally has 10 business days to investigate. The institution must tell you the results of its investigation within three business days after completing it and must correct an error within one business day after determining that the error has occurred. If the institution needs more time, it may take up to 45 days to complete the investigation -- but only if the money in dispute is 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: 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.
For more information, see Electronic Banking and Credit, ATM and Debit Cards: What to Do If They're Lost or Stolen , two consumer publications from the FTC at www.consumer.gov/idtheft .
Proving You're a Victim, Not a Deadbeat
Unlike victims of other crimes, who generally are treated with respect and sympathy, identity theft victims often find themselves having to prove that they're victims, too -- not deadbeats trying to get out of paying bad debts. So how do you go about proving something you didn't do? Getting the right documents and getting them to the right people is key.
The Police Report: If you have a police report, send a copy to Experian, Equifax and TransUnion. They will block the information you're disputing from your credit reports. This may take up to 30 days. The credit bureaus have the right to remove the block, if they believe it was wrongly placed. Because this initiative is voluntary in the vast majority of states, it's important to also follow the dispute procedures outlined in "Credit Reports," above. Contact the credit bureaus to find out more about how the "Police Report Initiative" works.
The ID Theft Affidavit: Since you didn't open the accounts in dispute or run up the related debts, of course you don't have any paperwork showing you didn't do these things. That's where the ID Theft Affidavit can be very helpful. The FTC, in conjunction with banks, credit grantors and consumer advocates, developed the ID Theft Affidavit ( click here ) to help you close unauthorized accounts and get rid of debts wrongfully attributed to your name. If you don't have a police report or any paperwork from creditors, send the completed ID Theft Affidavit to the three major credit bureaus. They will use it to start the dispute investigation process. Not all companies accept the ID Theft Affidavit. They may require you to use their forms instead. Check first.
Creditor Documentation: Getting documentation from a creditor may be difficult. Creditors' policies on confidentiality and record keeping vary and may prevent you from getting the paperwork you need to prove you didn't make the transaction. On the upside, most victims can get accounts closed and debts dismissed by completing the creditor's fraud paperwork or the ID Theft Affidavit and including a copy of your police report. Insist on a letter from the creditor stating that they have closed the disputed accounts and have discharged you of the fraudulent debts. This letter is your best defense if errors reappear or your personal information gets re-circulated. This letter is also the best document to give credit bureaus and debt collectors if your police report and ID Theft Affidavit aren't enough to resolve your problems with them.
Sample Dispute Letter - Credit Bureau
Your City, State, Zip Code
Name of Credit Bureau
City, State, Zip Code
Dear Sir or Madam:
I am writing to dispute the following information in my file. The items I dispute also are circled on the attached copy of the report I received. (Identify item(s) disputed by name of source, such as creditors or tax court, and identify type of item, such as credit account, judgment, etc.)
I am a victim of identity theft, and did not make the charge(s). I am requesting that the item be blocked to correct my credit report.
Enclosed are copies of (use this sentence if applicable and describe any enclosed documentation) supporting my position. Please investigate this (these) matter(s) and block the disputed item(s) as soon as possible.
Enclosures: (List what you are enclosing)
Sample Dispute Letter - For Existing Credit Accounts
Your City, State, Zip Code
Your Account Number
Name of Creditor
City, State, Zip Code
Dear Sir or Madam:
I am writing to dispute a fraudulent (charge or debit) attributed to my account in the amount of $______. I am a victim of identity theft, and I did not make this (charge or debit). I am requesting that the (charge be removed or the debit reinstated), that any finance and other charges related to the fraudulent amount be credited as well, and that I receive an accurate statement.
Enclosed are copies of (use this sentence to describe any enclosed information, such as police report) supporting my position. Please investigate this matter and correct the fraudulent (charge or debit) as soon as possible.
Enclosures: (List what you are enclosing.)
Although procedures to correct your record within the criminal justice databases vary, the following information can be used as a general guide.
If wrongful criminal violations are attributed to your name, contact the arresting or citing law enforcement agency -- that is, the police or sheriff's department that originally arrested the person using your identity, or the court agency that issued the warrant for the arrest. File an impersonation report. And have your identity confirmed: The police department takes a full set of your fingerprints and your photograph, and copies any photo identification documents like your driver's license, passport or visa. Ask the law enforcement agency to compare the prints and photographs with those of the imposter to establish your innocence. If the arrest warrant is from a state or county other than where you live, ask your local police department to send the impersonation report to the police department in the jurisdiction where the arrest warrant, traffic citation or criminal conviction originated.
The law enforcement agency should then recall any warrants and issue a "clearance letter" or certificate of release (if you were arrested/booked). You'll need to keep this document with you at all times in case you're wrongly arrested. Also, ask the law enforcement agency to file, with the district attorney's (D.A.) office and/or court where the crime took place, the record of the follow-up investigation establishing your innocence. This will result in an amended complaint being issued. Once your name is recorded in a criminal database, it's unlikely that it will be completely removed from the official record. Ask that the "key name," or "primary name," be changed from your name to the imposter's name (or to "John Doe" if the imposter's true identity is not known), with your name noted only as an alias.
You'll also want to clear your name in the court records. You'll need to determine which state law(s) will help you do this and how. If your state has no formal procedure for clearing your record, contact the D.A.'s office in the county where the case was originally prosecuted. Ask the D.A.'s office for the appropriate court records needed to clear your name.
Finally, contact your local motor vehicle authority to find out if your driver's license is being used by the identity thief. Ask that your files be flagged for possible fraud.
You may need to hire a criminal defense attorney to help you clear your name. Contact Legal Services in your area or your local bar association for help in finding an attorney.
Fake Driver's License
If you think your name or social security number is being used by an identity thief to get a driver's license or a non-driver's identity card, contact your local government authority for motor vehicles. If your social security number is used as your driver's license number, ask to substitute another number.
If you believe that an identity thief has tampered with your securities investments or a brokerage account, immediately report it to your broker or account manager and to the local government authority. When filing a complaint, be sure to include as much detail as possible.
- U.S. Securities and Exchange Commission (SEC)
You can file a complaint with the SEC using the online Complaint Center at www.sec.gov/complaint.shtml .
If an identity thief has stolen your mail to get new credit cards, bank or credit card statements, prescreened credit offers or tax information, has falsified change-of-address forms, or obtained your personal information through a fraud conducted by mail, contact the proper authorities, such as the local postal inspector in the U.S.
- U.S. Postal Inspection Service (USPIS)
If you've lost your passport or believe it was stolen or is being used fraudulently, contact your country's passport agency.
- United States Department of State (USDS)