Home Living
Avoiding Identity Theft and Fraud
Part I - Fraud Alerts
This month I wanted to follow up on an article I wrote a couple of years ago. Many of you have called over that time frame to ask about whatever happened to Gladys. For those of you who don't know that name, I will provide a little background. While I was working at a previous employer, we employed Gladys (not her real name) for about six months. We terminated her employment for unrelated reasons, but subsequently discovered she had provided a false social security number. She had used that social security number and managed to build a credit rating, purchase a car, and a new home. That social security number in fact, belonged to a very nice fellow in Collegiate Point, NY. To make a long story short, Gladys decided her termination was not to her liking and threatened a law suit. We hired a private investigator to do a background check in response to that threat. (A policy which became standard practice, post Gladys) That report clearly showed beyond any reasonable doubt, that this was not the first time Gladys had used an alias or someone else's social security number. In fact, she had used four separate social security numbers and six different aliases. In each case, she had left some amount of derogatory credit in her wake, under those victim's social security numbers. We provided the Jefferson County Sheriff's Complex Crimes division, with a complete copy of that private investigator's report. Nothing happened until a few months later, when I wrote an article about these events. I was concerned that nothing had been done, because Gladys was still working in the mortgage business and had access to other people's identities on a regular basis. Low and behold I got a call from the Sheriff's department the week the article went to press. I was assured that an investigation was moving forward and that Gladys had been called in for questioning. Subsequently, I learned from the investigator that she had canceled the meeting and was in the process of hiring an attorney. Out of my own and my reader's curiosity, I have followed up from time to time to inquire about the progress of the investigation. The last I heard from the Jefferson County Sheriff's office was that they do not consider this to be fraud. I was informed that it wouldn't rise to the level of fraud, unless Gladys went into a foreclosure. Apparently if no one is officially harmed (suffers a financial loss), then it doesn't rise to the level of fraud. I decided to call a couple of real estate attorneys in Colorado to see if that sounded correct to them. Both attorneys thought that this was incorrect, and that Gladys had in fact committed fraud and should be prosecuted. Knowing I planned a follow up article, I have left a couple of messages with the investigator over the last month, but he has not returned either of my phone calls so far. If any real police work ever did get done, it certainly didn't interrupt Gladys' criminal career. She still works in the mortgage industry, and lives in the same house she bought with someone else's social security number.
In my first article regarding this issue, I had mentioned that it might not be a bad idea to place a fraud alert on your credit report with all three bureaus, as a preventative measure. It is still the only sure way our friend in NY, could have prevented Gladys from using his social security number. However as it turns out, this may not be the best advice from a personal convenience perspective. In essence, a fraud alert requires that any new creditor must first contact you at your home or work number, to verify you want the new loan or credit to be issued. So if someone else is trying to use your identity (or social security number), you can say no before it ever happens. However a problem that some of you experienced, is that this likewise prevents instant credit from being issued. One of my readers wanted to get the 10% off at Dillard's department store, for opening a new charge account. Since she was standing at the register, she could not be reached at home or work. Her application was rejected and she felt awful at the time. Once she discovered that it was simply the result of the fraud alert, she was actually comforted to know that it had worked. But she missed the discount. Next month in part II, find out a list of things you can do other than filing a fraud alert, to protect your identity. For those of you who are willing to take your chances, I would consider it must reading. I know Gladys does! For expert advice on this or any other aspect of home finance, talk to the professional. Dan Smith can be reached at 303-674-0201
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