Identity Theft is Systemic, Pervasive, and Increasing Exponentially
Over 9 million Americans become victims of identity theft every year according to the Federal Trade Commission. Fraudulent purchases total $31 billion per year while the total economic impact to businesses is valued at a staggering $221 billion. However, the real cost to victims of identity theft is the damage done to their credit and the inordinate time required to repair the damage. The fraud itself is often the least of the victims’ worries; information posted to the victims’ credit report may haunt them for years if not dealt with properly. According to the Identity Theft Resource Center’s “Aftermath,” 47 percent of victims have trouble qualifying for a loan following identity theft. Fortunately, the Fair Credit Reporting Act (FCRA) provides rights for victims of identity theft that can be used to repair the damage.
Identity Theft Victims Have Federal Consumer Rights Protections
Under the FCRA victims have the right to place a fraud alert on their file for 90 days if they believe that identity theft has taken place. Once a victim has filed an identity theft incident report with a local law enforcement agency, the victim may use the report to request an extended alert which stays with his or her credit report for 7 years. After a fraud alert has been filed, the identity theft victim has the right to access information related to the fraud. An initial alert allows access to a copy of the victim’s file from all three major credit reporting agencies, and an extended alert provides 2 copies of credit reports in the following 12 months. Victims who possess the proper paperwork also have the right to access documents related to the fraudulent purchases in hopes of locating the perpetrator or stopping his or her future actions. These documents may include credit applications, transaction records, or information from debt collectors.
Victims of identity theft also have the right to ask that information resulting from identity theft be removed and blocked from their credit report files. The FCRA also obligates credit reporting agencies and furnishers of information to investigate and remove inaccurate data including data resulting from an identity theft. Despite the rights guaranteed under the FCRA, however, legitimate investigations and the resulting corrections to the victim’s credit report have been difficult in the absence of attorney assistance. Testimony from several identity theft trials has shown that these investigations were often limited to two minutes each and consisted of nothing more than checking the agency’s information against the furnisher’s report. According to the “Aftermath” report, 70 percent of victims have difficulty removing information that resulted from identity theft transactions. The credit reporting agencies have demonstrated that they will do as little as possible unless forced to act further—often only after an attorney is involved. Fortunately, the FCRA allows consumers to recover damages and attorney’s fees for willful noncompliance against non-compliant credit reporting agencies.
Unfortunately, a Consumer Rights Attorney is Often Needed when Dealing with Identity Theft
We have experience in removing improper negative credit data appearing on credit reports as a result of identity theft. We even have experience defending identity theft victims who are actually sued and brought to trial. We have forced credit reporting agencies to correct inaccurate credit reports and asserted and enforced the protections offered to identity theft victims under the FCRA. Many of our professional legal services can be offered without up front payment of attorney’s fees or costs because various laws will force unlawful credit reporting agencies to pay them for the identity theft victim.