Topic Overview Responding to Identity Theft: Civil Rights & Remedies

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1 Topic Overview Responding to Identity Theft: Civil Rights & Remedies Suzanne Begnoche, Attorney at Law Chapel Hill, North Carolina (919) Client Screening Initial Investigation Preparing an Identity Theft Affidavit Minimizing Identity Theft Consequences Civil Remedies for Identity Theft Victims Investigation Steps Screening call. In-person screening follow-up meeting. Initiate fraud alert and security freeze. Obtain credit reports if necessary. Consumer to file police report and update investigating officer as necessary. Initiate fraud block and notify creditor. Screening Call Establish whether consumer is calling about an actual identity theft orunauthorized use of an existing card or account of consumer s. Establish that your office will not represent consumers in identity theft matters unless the consumer is willing to file a police report and assist in the prosecution of the perpetrator. Instruct consumer to obtain current credit reports ( Screening Meeting Materials Originals of Social Security Card, Driver s License, Passport, any other Photo ID. Current credit reports. All prior names, Social Security Numbers, addresses, employers. Documentation of name changes. Documentary evidence of the identity theft account (bills, collection letters). Screening Meeting Materials Documentary evidence of client s attempts to resolve identity theft: Client s notes Letters to/from creditor and credit bureaus. Police report and contact information for investigating officer. FTC complaint/response. Attorney general complaint/response. Communications with perpetrator. 1

2 Screening Meeting Follow-up Client should keep detailed records of subsequent communications and interactions with the creditors, credit bureaus, law enforcement, etc. Client should log date/time of each communication, full name and number of each person spoken with. If client choses to pursue own written communications, should use certified mail and keep copies. Red Flags Client knowingly allowed another person to use his/her identity. Client conceals key information, such as a legal name change or gender change. Client claims pending/past criminal charges were incurred by identity thief. Client claims government officials are working in concert with identity thief. Red Flags Client knows the identity of the perpetrator, but does not want to report him/her to law enforcement. Perpetrator is a family member of client s. Client MUST be willing at all stages of the matter to report the crime to law enforcement and assist with the prosecution of the perpetrator. Fair Credit Reporting Act (FCRA) Applies to claims regarding consumer reports and against credit reporting agencies and furnishers. 15 U.S.C. 1681, et seq. FCRA Provisions: Fraud Alert 90 Day Renewable Fraud Alert: Consumer calls fraud hotline for one of the CRA s to request; that CRA will notify the others. Effect: Business must verify identity before issuing credit. Consumer should ensure each credit bureau has current contact information so creditors can contact consumer for verification. FCRA Provisions: Fraud Alert Free Credit Reports: Fraud alert process entitles consumer to a free copy of credit report from each bureau. Should obtain from each and review for fraudulent accounts. 2

3 State Law Provisions Credit Report Freeze : Blocks potential creditors from obtaining consumer s credit report, thus limiting an ID thief s ability to open new accounts. N.C.G.S Won t prevent ID theft related to taxes, public benefits, healthcare, etc. or accounts with creditors who don t use bureau screening. State Law Provisions Online freeze request forms: linked at Protect-Your-Identity/Protect-Yourself/Freeze- Your-Credit/Free-Security-Freeze.aspx Freeze form letter: Included in CLE materials. Consumer will receive a PIN from each bureau to use for temporarily lifting the freeze. Identity Theft Affidavit Must include consumer identification information and specific details of identity theft accounts. Use FTC sample affidavit included with CLE materials as a guide. To obtain CRA fraud block, must aver that the [identity theft] information does not relate to any transaction by the consumer. Attach all supporting documentation and proof of identity. Identity Theft Affidavit Submit with police report, other agency complaints, and fraud block letters. If client suspects identity theft arose from information obtained through theft of mail, should also report to U.S. Postal Inspection Service. FCRA Provisions: Extended Fraud Alert Consumer who supplies copy of police report can request an extended fraud alert that lasts up to seven years. My opinion: NC consumers who have already put a security freeze in place do not need the extended fraud alert. Client who choses extended fraud alert instead of freeze should monitor credit at least once yearly. FCRA Provisions: Fraud Block Blocks CRA from reporting identity theft accounts and other identity-theft related information (addresses, names, employment, etc.). Information furnisher cannot sell, transfer, or assign an identity theft account after notification of fraud block from CRA. Information furnisher must stop credit reporting of the account to any CRA. 3

4 Fraud Block Request Supplements Copy of credit report with fraudulent information circled. Copy of police report & supporting evidence. Identity Theft Affidavit. Copy of driver s license/passport. Copy of Social Security card. Copy of utility bill with consumer s name, or other evidence of residential address such as a lease. Contacting the Business Notify creditor of fraudulent account by providing a copy of the fraud block letter and supporting documentation to business s fraud investigation department. Consumer should indicate ability and desire to assist in investigation and prosecution of identity thief. Consumer should respond promptlyto requests for additional information. Contacting the Business FCRA requires that, upon request, furnisher provide copies to the consumer of documentation of identity theft transactions: Credit applications Credit agreements Transaction records, such as charge slips This provision of FCRA is not privately enforceable; unfortunately not every furnisher complies with such requests. Tax Issues Usually receive IRS notification IRS says client received wages from an employer unknown to client Multiple tax returns filed for same year/refund already taken Balance due for year in which no return filed Notice of change in public benefits due to increased income Tax Resources IRS Notice, if received, will have specific contact information, otherwise- IRS Web Guidance: Identity-Theft IRS Identity Protection Specialized Unit: (800) IRS ID Theft Affidavit: Form Criminal Record Issues Often discovered during the course of an employment background check. Impersonator may have used client s identity when arrested/charged/prosecuted. Client may need criminal defense referral if outstanding warrants exist or probation is still in effect. 4

5 Criminal Record Issues Contact law enforcement agency or DA for assistance proving client s identity and that he/she is not same person. May require official fingerprinting, other proof of identity. Get documentation of clearance from agency. Notify vendors that handle criminal record information for the agencies involved in order of correction to client s criminal record. Medical Billing Issues Dispute bill with provider, collection agency. Request that provider compare client s official signature from license/passport with signature on provider s documentation. Request that provider compare client s physical attributes to those on medical records. Notify insurance company s fraud investigation unit. Social Security/Benefit Issues Notify Social Security Administration. May also need to notify IRS and complete IRS ID theft affidavit. Other Issues Addressed on FTC website and in resource materials accompanying the CLE: Minor child identity theft Student loan identity theft Utility identity theft Unauthorized use of credit/debit card Consumer Remedies Available Fair Credit Reporting Act (FCRA) Fair Credit Billing Act (FCBA) Fair Debt Collection Practices Act (FDCPA) Electronic Funds Transfer Act (EFTA). N.C. Law: Identity Theft Protection Act. N.C. Law: Tort claims. General Resources: Consumers FTC booklet, Taking Charge,Whatto Do if your Identity is Stolen. Includes sample letters, forms. With CLE material and at taking-charge.pdf National Consumer Law Center, Surviving Debt(2013). Consumer rights guide, including tips on dealing with identity theft. To order, visit 5

6 General Resources: Small Business FTC Privacy Compliance: Cybersecuritybasics for small businesses: featured-info-small-business General Resources: Attorneys National Consumer Law Center, Fair Credit Reporting(8th Ed. 2013). Several chapters on identity theft litigation and information privacy protections. To order, visit FTC Guide for Assisting Identity Theft Victims (Sept. 2013), with CLE materials and at: guide-assisting-id-theft-victims.pdf General Resources: Attorneys Suzanne Begnoche, Civil Remedies for Victims of Identity Theft, NC Advocates for Justice, Trial Briefs magazine, June 2013 issue. Included with CLE materials. (Provides more in-depth explanation of the statutes involved, including citations to specific provisions and case law.) 6