Navigating Fraud & Identity Theft – Protect Your Assets

The Federal Trade Commission reported over two million fraud and identity theft cases in 2021. This results in a cost of over five billion dollars for consumers. Technology has opened up new avenues for identity theft and other fraudulent activities.

Here, you will learn to protect yourself and your finances from these threats. Austin Bankruptcy Lawyers will also share some practical measures to protect yourself from fraud. They will inform you of what actions to take if you become a victim of identity theft.

How Can You Protect Your Credit Or Debit Cards From Fraudulent Activities?

Staying vigilant and informed about your accounts is crucial to protect yourself from fraudulent activity on your credit or debit cards. It’s essential to take steps to protect your personal information. First, only share your social security number if you have a secure connection. Never provide it over the phone. Changing your passwords regularly and avoiding using the same password for multiple accounts is also advisable.

For instance, imagine if one of your family members texts you and requests your social security number. In such a situation, it’s essential to refrain from responding with sensitive information via text message. Be cautious not only about whom you share your information with but also about how you share it. Adopting these practices can significantly minimize the risk of falling victim to fraud. Many banks and credit bureaus can also help protect your identity.

Can Major Credit Bureaus Help Protect Your Credit & Identity?

The best way you can stay safe is to keep an eye on your credit reports. Consider personally checking a single report every four months so that you can detect any unauthorized or unexpected activity. Credit cards may also offer services that monitor your credit reports and flag any suspicious activity.

Your bank may also help by scrutinizing your debit card usage. They may contact you if they detect unusually high or spot charges from an uncharacteristic area. If there’s no response, they will freeze your card. Although it may be inconvenient, these precautions are in your best interest. The service is also an excellent tool to have in place to protect your financial safety.

Be sure to learn more about how to protect yourself from identity scams. It is better to be on the safe side to prevent complications.

What Is A Credit Freeze?

A credit freeze is a proactive step to protect yourself from identity theft. You would notify the three credit reporting bureaus that you have been the victim of identity theft. It will also tell them you do not authorize any new credit using your information.

While a credit freeze is effective in preventing new accounts that your identity thief may try to open, it also has a drawback. You must lift the credit freeze to open new credit accounts yourself.

Remember that a credit freeze may impact your finances. After all, it restricts new credit from being opened. Nonetheless, the peace of mind that comes from knowing your financial information is protected can be worthwhile. You can always lift the freeze when you’re ready to open new accounts again.

Does Credit Freeze Impact Your Ability To Pay Bills?

You can still pay your ongoing rent and utilities even with a credit freeze. These payments do not involve acquiring new debt or opening new accounts. You can continue paying them using your credit card or transferring funds from your account. You may also use whatever way you usually have to make these payments.

Can You Apply For Rent Renewal With A Credit Freeze?

Regarding renting, landlords often check credit reports as part of the application process. It’s natural to wonder how a credit freeze might impact your ability to apply for an apartment or renew your lease. The good news is when you renew your lease, landlords typically do not run a new credit report. Because of this, a credit freeze does not affect this process.

Even when renting a new apartment, landlords may pull a credit report, but it will usually be a soft rather than a hard examination. During this, they focus on potential red flags like eviction records rather than just your credit score. Despite having a credit freeze, you should still be able to rent a new property. However, if a landlord encounters difficulties running your credit due to the freeze, you can temporarily lift it before applying.

How Do You Address An Unauthorized Use Of A Credit Card?

As a customer, you have the right to expect the bank to rectify the situation. They generally have flexibility in matters like addressing unauthorized credit use. However, if the bank refuses to refund the money, you may be responsible for paying the debt.

Learn to monitor your credit card statements actively and not let 30 days go by before checking them. The 30-day limit is to ensure that you regularly review your transactions. You can secure better financial security by monitoring transactions proactively and promptly addressing unauthorized use.

Will Bankruptcy Cover & Discharge Debt Incurred From Identity Theft?

You can discharge debt resulting from identity theft through bankruptcy if it falls under dischargeable debt. When filling out a bankruptcy petition, there is a section where you can see a list of obligations. Make sure to include all debts to ensure comprehensive coverage. Whether legitimately yours, incurred by someone using your information, or debts you need clarification on. This approach allows for a thorough assessment of the debts that could come your way.

However, if you incurred the debt through fraudulent actions like forging a signature or inflating income, it may not be discharged in bankruptcy. In such cases, only obligations resulting from being a victim of identity theft are usually eligible for discharge.

Can You Restore Your Credit After Identity Theft?

To restore your credit score after identity theft, dispute any fraudulent debts on your credit report. Keep reporting this until you remove the unauthorized debits. This alone can go a long way in improving your credit score. Other ways to boost your credit score include making timely payments, paying down credit card balances, and using credit sparingly.

If you suspect someone has filed tax returns claiming your refund without your permission, report it to the Internal Revenue Service (IRS). They have a specific form (Form 14039) for such cases. The form, known as an Identity Theft Affidavit, also applies to other types of identity theft. You must provide details such as when the identity theft occurred and which tax years were affected.

Can You Protect Your Government Benefits In Identity Theft?

There are cases where someone tries to file for your government benefits through identity theft. The first thing to do is to contact the government agency responsible for the benefits. You will likely be asked to identify yourself and may need to file a police report to document the incident. It is essential to follow through and have a paper trail to protect your rights as a victim of identity theft. You never know when you might need the benefits, so take advantage of the opportunity to protect your rights.

How Can Bankruptcy Help Business Recover From Identity Theft & Fraud?

If your business has incurred debts due to fraudulent activity, bankruptcy may provide a path to recovery. However, explore other options before considering bankruptcy. You may file a police report and contact your liability insurance provider. In some cases, insurance can cover losses resulting from fraudulent activity.

Alternatively, you may pursue legal action against the individual responsible for the fraud through a civil lawsuit. This allows you to seek financial restitution for the damages caused. Bankruptcy might be an option if you have incurred debt from fraudulent activity. However, assessing your circumstances and consulting with legal professionals is vital to determine the best action.

Can Bankruptcy Provide Relief For Investment Fraud?

Investment fraud, including scams involving cryptocurrencies, can have severe financial consequences. If you have incurred debt due to this, including this debt in your bankruptcy petition is possible. However, if you made cash payments without using credit, the debt may not be eligible for inclusion.

In investment fraud cases, you should immediately report the incident to the authorities. This ensures that appropriate action is taken and helps protect others who may have fallen victim to the same scam.

Does Fraud Affect Bankruptcy Filings In Community Property States?

If your spouse has fallen victim to identity theft, it can impact your finances. In community property states, debt acquired after marriage could affect joint liabilities. However, if the identity theft occurred before marriage, it is less likely to impact you directly.

To protect yourself, diligently keep track of all financial activities, review credit reports, regularly check bank statements, and ensure strong password security. By staying proactive, you can safeguard your joint finances and minimize the impact of identity theft.

Summary

In 2021, the Federal Trade Commission reported over two million fraud and identity theft cases, costing consumers over five billion dollars. Protect yourself by safeguarding personal information, avoiding insecure data sharing, and changing passwords regularly.

Credit bureaus and banks offer tools for monitoring and protection. While a credit freeze can prevent unauthorized accounts, it may require lifting for new credit. In cases of unauthorized card use, monitor transactions and address promptly. Contact an experienced bankruptcy attorney in Austin for further guidance.

Restore credit by disputing fraudulent debts and managing credit wisely. Shield your government benefits, address business debt, and deal with investment fraud legally. Be sure to stay vigilant against identity theft and fraud.