FRAUD 101

Most people are honest, but there are many who are not. These are the 'bad guys', and they are a sneaky, cunning lot who will commit an act of fraud every chance they get. But do not despair - you can fight the bad guys! If you arm yourself with everything you need to know about fraud, you can protect all that you have worked so hard for. And should all your preparations fail, you'll at least know what to do to minimize the damage should a fraudulent act occur.

Your first step toward protection is to understand the different categories of fraud. Let's take a brief look at the most common types:

• True Name Fraud. This occurs when a fraud perpetrator assumes the identity of a consumer. According to the Federal Trade Commission, about 50% of all reported identity theft complaints come from a perpetrator opening a new credit card account in the consumer's name.
• New Identity Fraud. This occurs when the fraud perpetrator actually takes on a new identity, perhaps even the identity of a deceased.
• Account Takeover. This occurs when the fraud perpetrator "takes over" a consumer's accounts and makes fraudulent charges on them. This often includes a perpetrator stealing the consumer's existing credit card number, or card itself, and making unauthorized charges.

How Do the 'Bad Guys' Do It?

They...

• Go through your mail or trash, looking for items like bank and credit card statements, pre-approved credit offers, and tax information.
• Steal personal information from your wallet or purse such as identification, credit cards, or bankcards.
• Complete change-of-address forms to redirect your mail.
• Acquire personal information you share on unsecured sites on the Internet.
• Buy personal information about you from an inside source -- for example, a store employee that gets your information from a credit application or by "skimming" your credit card information when you make a purchase.

What To Do If Fraudulent Activity Is Found

1. Keep a record. Recovering from identity theft can be a long and complicated process, so it's important to keep a record of all communications. Send all letters by certified mail and keep copies. If you think your case might lead to a lawsuit, keep track of how much time you spend dealing with the problem.
2. Call the police. Report the crime to the police or sheriff's department that has jurisdiction in your case and request a police report. Though the authorities are often unable to assist you, a report may be necessary to help convince creditors that someone else has opened an account in your name.
3. Contact the Federal Trade Commission. Call the FTC's identity theft hotline at 877-438-4338 and file a complaint. The FTC does not resolve individual consumer problems itself, but your complaint may lead to law enforcement action.
4. Check your credit report. Get your credit report FREE once a year from Equifax, Experian and TransUnion, or purchase your 3-in-1 Credit Report and check for inquiries that you do not recognize, balances and payments reported, and any new accounts opened in your name. New accounts may take up to six months to show up on the report; therefore, it is imperative that you continue to monitor your credit.
5. Activate fraud alert. Equifax can place an Initial Alert on your credit file that is effective for 90 days. You can also place an Extended Alert by writing to Equifax or one of the other nationwide credit reporting companies and providing an Identity Theft Report as well as a day and evening telephone number. The requirements for an Identity Theft Report are listed on the FTC's website at www.ftc.com. The extended alert stays on your credit file for 7 years and removes your name from pre-screened offers of credit for 5 years. If you have been called to active duty military service away from you usual duty post, you can place an Active Duty Alert, which will remain on your file for 12 months, and removes your name from pre-screened offers of credit for 2 years. Equifax will automatically share any Fraud Alerts or Active Duty Alerts that you place with Equifax with the other two nationwide credit reporting bureaus.
6. Freeze fraudulent accounts. Contact the appropriate creditors, banks, phone companies, and utility companies and have them freeze the compromised or fraudulent accounts. You'll probably be liable for only $50 of the fraudulent charges, but different issuers have different policies. Most creditors promptly issue replacement cards with new account numbers.

Special Scenarios: What to Do
Place a Security Freeze on your credit file.

If you reside in select states you have the right to place a security freeze on your Equifax credit file. A security freeze will require you to plan ahead for all your credit applications as you will need to contact us to request that we temporarily lift your freeze to allow us to report your Equifax credit file to the credit grantor you identify. This 'freeze' will prevent unauthorized activity from happening until you decide to 'thaw' it out.

Mail fraud

If you suspect that someone has changed your address with the post office or used the mail to commit identity theft, notify the US Postal Inspector.

Fraud using your Social Security number

If your Social Security number has been used to commit identity theft, contact the Federal Trade Commission (FTC), which is charged with handling most identity theft complaints at 1-877-IDTHEFT (1-877-438-4338). You can order a copy of your earnings and benefits statement to check whether someone has used your Social Security number to get a job or to avoid paying taxes.

Fraud involving your driver's license number

If your driver's license number has been used to open accounts or verify checks, contact your state's Department of Motor Vehicles.

Fraud involving your passport

Notify the U.S. State Department's Passport Services Department of the identity theft so that it can intercept anyone ordering a new passport in your name.

Fraud involving a business scam

If the fraud was perpetrated as part of a business scam, contact the National Fraud Information Center at 800-876-7060.

Moving Forward: How to Avoid Fraud in Your Future

Check your credit report regularly. This can help you catch mistakes and fraud before they wreak havoc on your personal finances. Make sure your report is accurate and includes only information that you understand. Equifax Credit Watch™ is a simple yet powerful tool for helping you to stay on top of all activity - authorized or not - on your credit report, and keep the bad guys from damaging your credit.