You might think that checking your credit score gives you a safe sense of security. But what if, and I mean, what if someone has already stolen your information without leaving any trace on your credit report? This is a real concern.
Credit monitoring services are designed to spot certain types of identity theft, especially when it comes to new credit accounts. Yet, the issue lies in the fact that thieves can also invade your existing bank accounts, retirement savings, or even your government benefits without triggering those usual credit alerts. So, a spotless credit report might not mean much in terms of your overall safety. Let’s break down what credit monitoring can catch, what it might overlook, and how you can better protect yourself.
By the way, if you’re interested in, um, learning more about staying safe while traveling, you might want to join a free online class called “5 Ways to Travel Smarter and Save Money” happening soon. It’s being led by Kurt, also known as “CyberGuy.” He’ll cover how to secure your phone and personal information, score some better travel deals, dodge common scams, and make the entire travel experience less stressful. Sounds useful, right? Just make sure to register for the class in advance.
IDENTITY THEFT PROTECTION IS CHANGING: WHAT TO LOOK FOR
What credit monitoring actually watches
In general terms, credit monitoring keeps track of any changes to your credit file. Depending on the service, it can alert you to suspicious activities tied to your credit history.
You might receive alerts like:
- New credit accounts: When a lender reports a new account in your name.
- Hard credit inquiries: If someone applies for credit using your information.
- Credit score shifts: Any changes in your score resulting from reported activities.
- Collections actions: Appearance of a collection account on your report.
These alerts can help you identify new account fraud early. However, keep in mind that credit monitoring relies on what lenders report to credit bureaus. Meaning, it might not catch identity theft that occurs outside of this system.
Six ways criminals can target you without triggering credit monitoring
Here are a few ways that criminals can misuse your information or steal money without causing a credit monitoring alert:
1. Existing bank account takeover
If a criminal gains access to your existing financial accounts, like checking or retirement accounts, this takeover might not show up on your credit report. Often, you might only notice the theft through unfamiliar transactions or alerts from your bank.
2. Government benefits and tax fraud
Imagine someone using your Social Security number to file a tax return or claim benefits. You might get an IRS notification for a return you didn’t file or learn that unemployment benefits were claimed in your name—neither of which will likely impact your credit score.
3. Medical identity theft
A thief could use your health information to receive care or prescriptions, and you might get bills for treatments you never received. Unfortunately, this misuse typically doesn’t trigger credit monitoring alerts either.
4. SIM swap and phone account fraud
Criminals might convince your mobile provider to transfer your number to a new SIM card they control, allowing them access to verification codes for your accounts. A sudden loss of cellular service could be a red flag.
5. Scams involving direct payments
Sometimes, scammers may trick you into authorizing money transfers or buying gift cards. Since you technically initiated the payment, traditional credit monitoring won’t alert you.
6. Personal information exposed through data brokers
Your personal details might end up on various data broker sites, making you more vulnerable to phishing or impersonation scams. The FTC notes that unauthorized withdrawals, unfamiliar bills, and fraudulent tax filings can be warning signs for identity theft.
Why checking your credit score isn’t enough
While your credit score offers a snapshot of your creditworthiness, it doesn’t encompass the entirety of your financial situation or safeguard you completely. For instance, your retirement account can be accessed without affecting your credit score at all.
Criminals can exploit your personal information in ways that won’t show immediate changes to your credit score. So, checking your full credit reports and other accounts periodically becomes essential.
How to spot identity theft your credit report can’t catch
Luckily, keeping an eye out for suspicious activities doesn’t have to cost you. Here are a few habits to adopt:
1. Review your financial accounts regularly
Look at bank statements, retirement accounts, and apps for unfamiliar transactions. Setting up security alerts can also help.
2. Watch for suspicious tax activity
Be wary of IRS notices for returns you didn’t file or unfamiliar employers. The IRS also offers an Identity Protection PIN to help guard against fraudulent tax filings.
3. Check your Social Security earnings record
Every now and then, review your earnings history to confirm it matches your employment. Unexpected figures might require a deeper look.
4. Review medical bills and insurance statements
Check for any medical services or claims that you don’t recognize. If anything seems off, reach out to your medical provider or insurance company.
5. Protect your mobile phone account
Ask your mobile provider about options for account protection. Where possible, use authenticator apps instead of text-message verification.
6. Check where your personal information appears online
Search your name and contact details to see if they’ve been exposed on people-search websites. You can request removal or use a data removal service.
Pro tip: Pick a specific day each month to review your accounts and records in conjunction with your bill payments, making it easier to establish this routine.
How identity theft protection services can help
While credit monitoring is useful, it can’t catch every type of identity theft. Some services provide broader monitoring, identifying suspicious activities across financial and online platforms. Still, the coverage level depends on your chosen provider and plan.
What to look for in identity theft protection
- Credit monitoring: Alerts about new credit accounts or suspicious inquiries.
- Financial account monitoring: Notifications of potential suspicious activities.
- Dark web monitoring: Alerts regarding your personal information appearing in breaches.
- Phone takeover protection: Signs that someone may be trying to seize control of your phone account.
- Identity restoration assistance: Help from specialists if your identity is compromised.
- Scam reimbursement: Some plans may cover financial losses, though details vary.
- Data broker removal: Assistance in removing your personal info from data broker sites.
Be sure to compare the features and costs of different services before signing up. Remember, no identity theft protection service is foolproof. It works best alongside strong security practices like good passwords and regular account checks.
What to do if you discover identity theft
If you suspect your information has been misused, don’t hesitate to act. You don’t have to wait for an alert.
- Contact the affected institution directly using official contact info and secure your accounts.
- Change passwords for any compromised accounts and enable multifactor authentication.
- Report identity theft to the FTC at IdentityTheft.gov and create a personalized recovery plan.
- Reach out to the relevant government agency for issues like tax fraud.
- Consider freezing your credit with Equifax, Experian, and TransUnion to prevent new accounts from being opened in your name.
- Keep thorough records of any communication and suspicious activities.
You can also check your credit reports for free at AnnualCreditReport.com, as free weekly reports are available from the credit bureaus.
Kurt’s key takeaways
I’m a big advocate for regularly checking your credit, but I wouldn’t solely rely on your score to gauge your identity’s safety. I’ve seen cases where someone accesses an existing account without any impact on that score. So, it’s vital to keep an eye on your financial statements, activate alerts, and utilize additional protective measures when possible. Identity theft protection services can offer an extra layer of vigilance, but you’ll still need to be proactive in monitoring your accounts.
So, when was the last time you took a careful look at your bank accounts and medical statements for signs of identity theft instead of just checking your score? I’d love to hear your thoughts on this.
