In a recent article dated June 20, 2008 from npr.org, writer Dina Temple-Raston reports on the arrest of hundreds of people believed to be guilty of scamming the public out of millions of dollars of hard earned home equity.
She writes, “instead of stealing an identity to secure a credit card, scammers have been zeroing in on people they think have a lot of equity in their homes. They steal their identities, then go online and get a home equity line of credit on that person’s house and take the money.”
It’s a terrifying scenario for consumers who have worked hard for years to establish good equity and credit. As someone who works directly with victims of id theft, I know how frustrating it is for victims when the person who stole their identity is never caught or prosecuted. I am hoping that the news of these crooks getting arrested will bring about a feeling of justice for victims; that something is being done and people are being punished.
Temple-Rason concludes her piece with this warning, “the FBI is sending a specific message: If you are involved with mortgage fraud — whether on Wall Street with high-level investors, or on Main Street with ordinary homeowners — the bureau intends to catch and prosecute you.”
Score one for the little guy. For more, check out this video:
Credit monitoring is an important tool in today’s fight against identity theft. Many individuals subscribe to a service provided by all three of the major credit bureaus and their affiliates.
Is this an effective tool that prevents identity theft?
Unfortunately, the answer is no. Credit monitoring provides a useful tool to determine if there is an unauthorized change to your credit profile which may indicate misuse by an identity thief.
It does not prevent an identity thief from setting up fraudulent credit lines, changing your address, getting a job in your name, declaring bankruptcy, or committing crimes that become part of your records. All monitoring services will send you an alert when they detect a change to your credit profile. Only you can determine if that change was one you initiated or not. The assumption is if you didn’t do it, you may be a victim of identity theft.
There are a couple of other drawbacks to credit monitoring. The first is it does not monitor other types of accounts for potential fraudulent activity. For example, it does not monitor your checking account. Many forms of identity theft go undetected (see my related posting on Lifelock). The other drawback is if you believe there is misuse of your personal information, all of the services provided by credit bureaus make you fix this yourself. Although many offer assistance —this really translates to “do it yourself”. The other issue is that it reports changes to your credit profile as opposed to being an early detection tool of identity theft.
So while credit monitoring is not perfect, it is one of the most prevalent tools consumers use today to protect themselves from ID theft.
You might ask, are there better tools on the horizon? Stay tuned for my next post on Identity monitoring.
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by Heather Wells
