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Assisting consumers with identity theft resolution reflects positively on creditor clients and the collection industry.
A consumer calls and alleges she is the victim of identity theft. Do you know how to respond to the consumer's concerns? Does your agency have policies and procedures to handle such situations? The answers to such questions likely vary. However, with the current growth of identity theft in the United States, a collection agency needs to be able to answer "yes" to both of these questions.
Although identity theft is not a new crime, the advent and growth of information technology has increased the capacity for an identity thief to access a consumer's personal information and use such information fraudulently. The federal government recognized the pervasiveness of identity theft more than a decade ago when it enacted the Identity Theft and Assumption Deterrence Act, which criminalized identity theft crimes. Identity theft has also been addressed by numerous federal, state and local agencies. In fact, identity theft issues have become a priority for the Departments of Justice and Treasury and the Federal Trade Commission (FTC), which are all currently working to determine effective means to prevent, investigate and prosecute identity theft offenses.
Identity theft essentially involves the misuse of another individual's personal information, such as name, date of birth, Social Security number (SSN) or credit card number, to commit fraud. Although identity theft can happen in a variety of ways, the fundamental concepts are the same. A data thief gathers another's personal information from an array of potential sources, including dumpsters, workplace records, mailboxes, phishing scams or computer hacking. The data thief then uses this information to open new credit accounts, take over existing accounts, obtain government services or benefits, or evade law enforcement by taking on a new identity.
Unfortunately, many consumers do not even realize they have fallen victim to identity theft until they have been denied credit or a debt collector seeks payment for a debt the victim did not incur. This delay can result in substantial cost to both the consumer and her creditors. In spite of the current debate about the prevalence and cost of identity theft in the United States, approximately 8.4 million residents were victims of identity theft last year alone,...