Identity theft is rampant in the United States, with millions of people affected every year. The Federal Trade Commission (FTC) reported that consumers lost $12.5 billion due to identity theft in 2024.
The experience can be scary and uncertain, but you have options even if you think your identity has already been stolen. Don't delay, because the sooner you take action, the less harm the attacker can cause.
If you believe your identity might have been stolen, these steps can help you minimize the potential losses.
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1. Place a fraud alert
As soon as you suspect identity theft, your first course of action is to place a fraud alert. Do this by visiting the fraud alert of any of the three major credit bureaus (Experian, TransUnion and Equifax). There's no need to alert all three, as the others will be notified once you place the alert with one.
A fraud alert will let lenders know they should be extra cautious when verifying your identity. Fraud alerts can last for varying timeframes, such as one year or seven years.
2. Freeze your credit reports
This is similar to placing a fraud alert but more restrictive. Rather than advising lenders to take extra precautions, freezing your credit prevents them from accessing your credit report. This prevents anyone from opening credit in your name.
Because this is more limiting than a fraud alert, this step is best reserved for situations where you are highly confident your identity has been stolen. If your credit reports are frozen, and you want to apply for credit or a loan, you must unfreeze them before you can move forward.
3. Alert your bank and other financial institutions
Inform your bank and any other financial institutions of the potential fraud. For instance, if you have credit cards, a mortgage or an auto loan, inform each about your suspicion.
If your account with any of them is compromised, they might freeze the account or close it altogether. Credit card issuers can close your credit cards and mail new ones.
Another critical step is to increase your account security at your financial institutions. Consider changing your passwords and enabling multi-factor authentication (MFA).
If you change your passwords, use long passwords that aren’t easy to guess and contain a combination of upper-case and lower-case letters, numbers and special characters. You can use a password manager, such as those from 1Password, NordPass or LastPass.
4. File a claim with your identity theft insurance
With so many consumers affected by identity theft every day, identity theft protection can be a worthwhile investment.
If you already have identity theft insurance, you can file a claim with your insurer, and they will process it. In some cases, your employer might already cover you with identity protection.
If you don't already have identity theft insurance, you likely won't be able to get coverage for this incident. However, this kind of insurance can be well worth the cost. Several companies offer it, including Norton, Experian and Aura.
5. Report the identity theft to the FTC
If you suspect identity theft, it's best to cover all your bases. That includes informing the FTC of the potential theft by visiting IdentityTheft.gov. This is a website dedicated to reporting identity theft. It will also provide you with a personalized recovery plan, outlining the steps to recover your identity.
It isn't necessary to create an account on the website, but the results might be better if you do. This will allow you to get guidance through each step of the process, your plan will be updated, and they'll track your progress as you work to regain control of your identity.
6. Dispute fraudulent charges or accounts
When criminals steal someone's identity, they often make fraudulent charges or open new accounts in your name.
"You should regularly check your accounts and bank statements for unfamiliar charges," says Paul Tucker, chief information security officer at BOK Financial.
Tucker also recommends checking your credit report at least once a year for unrecognized accounts, which you can do at AnnualCreditReport.com. If you find any unrecognized charges or accounts, you can dispute them with the three credit bureaus.
When disputing charges or accounts, contact each bureau individually. Include as much information as possible, and attach your report to the FTC. These reports generally take up to 30 days to process.
7. Prevent future identity theft
Eliminating the threat of identity theft is impossible, but you can significantly reduce it by taking the proper steps.
For example, these steps are relatively low-effort and can help you stay protected:
- Use strong, unique passwords and a password manager.
- Be cautious about sharing personal information online.
- Regularly update antivirus and anti-malware software.
- Shred sensitive documents before disposal.
Tucker also suggests shredding documents containing Social Security and account numbers, as well as credit card information. You can also sign up for a free or paid credit-monitoring service.
"If your identity is stolen, you should immediately notify all your banks and financial companies. They can help correct unauthorized transactions, fix any incorrect information sent to credit reporting agencies, and work with you to help prevent future fraud," Tucker says.
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