Identity theft question (1 Viewer)

[Joe McKeown]

Perhaps someone could explain to me a little about Identity Theft.

Someone claiming to be John Smith applies for a credit card which the bank issues. Now the real John Smith gets his credit rating trashed because of this.Now what I don't understand, is that the bank failed to properly identify the person to whom it was extending credit. The real John Smith entered into no contract with the bank. The bank can provide no documents signed with John Smith's actual signature.

There's a big problem here and a big crime, but how can the real John Smith be made a victim? It was the bank that was defrauded, not John Smith. It seems that the trashing of credit ratings is nothing more than a retalitory strike from the true victim (the bank) against an innocent person.

There was a local case recently where a car dealer allegedly "stole" the identity of customers to obtain fradulent loans. Now the local DA is attempting to add "Fraud Alerts" to the credit records of the people whose identities were stolen. Seems Cool, but shouldn't there be a process whereby this sort of thing is actually removed? Or better yet, prevent these blotches from being added at all until true identity is confirmed.

IMHO if creditors were held liable for properly establishing identity before issuing credit, then the incentives would be in the right place. We would very quickly find the creditors as a collective group establishing the proper protocols for securly identifying individuals.

Anyone have insight?

 

[LewB]

No really sure about the specifics but I think that freely providing account numbers to telemarketers you don't know and not guarding your social security number have a lot to do with it. The SSN is the biggest risk of them all from what I can make out, since it's tied to so much information about you. My employer just demanded that our medical insurers no longer use our SSNs as ID numbers.
I used to pay my bills and then just throw all the statements and stuff in the trash. That stuff now goes into a 'confetti' shredder. Only $50 at the office supply store.

 

[MarcVH]

Life presents many instances where security and convenience are opposing values, and most people tend to value convenience over security. As you observe, most of the credit reporting infrastructure is set up to make it easy and convenient to get and use credit.

Liability, not on the part of credit issuers but on the part of credit reporting agencies, would also help, but of course it would make things less convenient.

 

[Charles J P]

I think credit ratings are the biggest problem and can create the most bullshit hassles of any other piece of information filed away about a given person. It doesnt even have to be a matter of theft, it can just be screw ups. When my wife and I applied for a loan for our house, there was quite a few things on here credit report that were just plain wrong. Balances on store credit cards that she had never had. A student load balance when she has NEVER, EVER, even been OFFERED a student loan (this was the scariest, as it was tens of thousands of dollars and she had never had a student loan in her life. It just was so frustrating because you feel so helpless. I think there really needs to be some changes to how credit ratings and personal information in general are handled.

 

[Rhett_Y]

"There's a big problem here and a big crime, but how can the real John Smith be made a victim? It was the bank that was defrauded, not John Smith. It seems that the trashing of credit ratings is nothing more than a retalitory strike from the true victim (the bank) against an innocent person."

What you have to remember identity theft (ca penal code 530.5pc) doesn't just relate to credit. People steal identiy's to purchase real estate, cars, credit, food stamps, loans, cell phones (clone and re-sell on market), all this while you are at home watching tv.

That is why when you do find out about this you report it to the police...and yes things do happen in a good way when the police get a hold of it......Also make sure to call all of your credit cards, have them reported stolen, call your credit report companies and have them flag your account, call bank, have them flag your account.....

Like others have stated convience is the name of the game........... When was the last time you went into the bank stood inline, waited for them to look over you credit app, talk to the manager on set limit....and then come back to you.....you haven't...instead we fill out the forms with all our info on it.......back to the credit card company.

Ways to protect onself

1. never leave mail at your mail box, take it to a public mail box you can drop it into, reason: people steal mail all of the time, looking for information.

2. shred everything. When in doubt shred it. If you don't keep your credit card statemenst, shred it, phone bills, gas bills, bank statements, you name it shred.......All a person needs is really a name.........trust me a name......

3. check your credit report regularly..........this will help you see if there is any irregalur activity.........


As far a question should the bank be held accountable...good question, but until then........protect yourself......

R~