Dealing with identity theft

We’ve all heard about identity theft and we closely guard our personal information, wary of schemes and scammers that may be lurking. But no matter how cautious we are, it can still happen—whether by a small personal oversight, an online security breach, or a careless mistake by a third party. The important thing is fixing it. And fast.

Unfortunately, there’s no quick fix.

John Russo, chief privacy officer for Equifax Canada, says many people have no idea their identities have been compromised until collection calls start.

“The first thing to do is request a copy of your credit file,” he says. “Review it carefully, and report any discrepancies for investigation and resolution.”

Equifax had 7,500 fraud victim notifications on its accounts in 2000. By the end of 2012, they had issued 28,651, a 24% increase from 2011. A consumer must pass through several levels of authentication such as confirming employment information, previous addresses and filing a sworn affidavit with the agency before a fraud alert is placed on his account.

Corporal Tim Laurence of the RCMP Integrated Counterfeit Enforcement Team recommends you first contact the police and then the Canadian Anti-Fraud Centre if you suspect you’re a victim of identity theft. You should complete an Identity Theft Statement to provide to every credit agency, in addition to police reports. Get the form online at: www.antifraudcentre-centreantifraude.ca.

Russo notes each credit-issuing agency has a different procedure. You may have to provide additional information to the creditor’s security department to prove identity.

An ID monitoring service says it can take up to 600 hours of effort over three years to restore a stolen identity. “The hardest piece to replace is your SIN—it defines you as a Canadian resident and citizen. You can’t just change it—it’s tied to years of personal history.”

Staff Sergeant Paul Lobsinger, who serves on the crime management team of the Waterloo Region Police, adds there are terms and conditions about the use of a debit card PIN that determines whether a bank covers an unauthorized withdrawal. “If the bank rules the PIN was generally known [or too easy to guess], it may not absorb the loss, leaving the consumer on the hook.”

Brad Brain, senior financial advisor with Manulife Securities, says identity theft is less likely to impact investment accounts due to compliance and identity verification requirements.

Once a report is made, even otherwise unaffected credit cards may be frozen while an investigation is conducted. You’ll also need sworn affidavits to accompany your documentation, which can cost more than $100 to prepare with the fees varying depending on the complexity of the case. Each credit-granting agency will require an original.

Lisa MacColl is an Ontario-based financial writer.