Identity theft and tax returns

[Dark Optimist]

First, I have to say that I am a long time (7 or 8 years at least) lurker. I have generally enjoyed the discussions and subjects discussed here. There have been times in the past that I have wanted to add a comment, but just never got around to registering.

What finally motivated me to register was personal identity theft and the IRS announcement of the dirty dozen scams for 2012.

The brief version of my story - about a month ago, I picked up my mail and had three letters from credit card companies saying "Welcome to your new credit card." However I had not opened any new accounts recently. After a couple of calls to the credit card companies, the accounts were frozen and referred to the internal investigation department.

Whoever had gotten my information had my name, address, Social Security number, DOB and even my wife's name. One thing that they did not have right is the spelling of my name (Adding a letter in one case, changing a vowel in another).

They opened the new accounts and bought electronics at the same time - from what I found out, they purchased in the area of $9,000 from two different stores.

Now for the really annoying part. I am a CPA. I prepare my own tax return. When I tried to electronically file my return, I got an error message that a return had already been filed.

So I make a call to the IRS. I have to call for clients all of the time, but this is the first time I've had to call for my own account. The agent was very helpful and confirmed that a fraudulent return had been filed - filing status had changed from prior year, etc. Fortunately the agent was also able to stop the refund check from being issued.

How did the person get my information? I have absolutely no idea. About three years ago I got a letter from a former employer that said a laptop with current and former employee data had been stolen. Perhaps the person who got my information is working their way through the alphabet and got to my last name.

So far it's taken me about 8 hours to get a hold put on my credit reports, file a police report, deal with the credit card companies, etc. Unfortunately this has been a pretty straightforward process - and I say unfortunately because it happens enough that the credit card companies and the IRS have trained their employees on how to work with a person who is a victim of ID theft.

So even if you check your credit reports on a regular basis, someone may still get your information and open accounts - if it weren't the letters from the credit card companies coming in the mail about a week after the accounts were opened, I probably would not have found out about the theft until the monthly statements started coming.

[rogfulton]

In Texas, law enforcement has a process to report ID theft to the FBI through their NCIC office and I am sure your state has a similar procedure.

Hopefully, that will add a little peace of mind as you continue deal with the aftermath.

[fortinbras]

ID theft was actually being marketed quite some time before internet was popular, by some unscrupulous "credit repair" and "debt elimination" companies. They euphemistically called their fraud "file segregation" and essentially, if you were their client, coming to them with ruined credit caused by major debts, they'd find someone (with better credit) whose name was not too different from yours, get his SSN, birthdate, and a few other personal details, and then tell you to pretend to be him. For this information they'd collect serious money (cash) from you. If you were desperate enough to do business with them, you would thereafter be living two lives; your own among friends and neighbors, and this other person's as far as most money transactions were concerned. You might even use the other person's SSN when getting a job - then the other person would be credited with your earnings (which would make his life miserable with the IRS) but the IRS would leave you alone.

The credit repair companies were obviously fly-by-night, probably operating just so long as one of the accomplices was working at some financial institution where he could wander through the files looking for suitable names.

[Arthur Rubin]

You have to thoroughly remove sensitive data from any unwanted computer you are disposing of

Removing the hard drive, running it through an MRI, and then running it over with a bulldozer will usually do the job. At my last job in a classified work environment, removing the hard drive and sending it by a secure method to an incinerator was the normal procedure. But metal-grade incinerators are hard to find....

[Lambkin]

You have to thoroughly remove sensitive data from any unwanted computer you are disposing of

Removing the hard drive, running it through an MRI, and then running it over with a bulldozer will usually do the job. At my last job in a classified work environment, removing the hard drive and sending it by a secure method to an incinerator was the normal procedure. But metal-grade incinerators are hard to find....

Unless your enemies have the resources of the NSA or foreign state governments, running a drill-bit through the drive is entirely sufficient. No garden-variety identity thief would take the trouble to piece together what's left.