Identity Theft: What's In Your Wallet?

12 Things to Do Immediately After Losing Your Wallet to Protect You from Identity Theft

It’s vacation time. We all long to be tourists exploring new places and having new adventures. But that also can mean an unexpected detour into Identity Theft Land if your wallet is stolen. In the iconic American Express commercials of the 1970s, Karl Malden would ask “What’s in your wallet?” Now’s a good time to find out. And here are the steps you’ll need to avoid identity theft if your wallet is lost or stolen.

Earlier this week, a long-time client of mine called me to ask for help. He had been vacationing on Cape Cod with his spouse and friends. They had left a restaurant to drive to some local shops when he then discovered that his wallet was missing. After some frantic searching, he reported his wallet missing to the local police. Lucky for him a Good Samaritan called to report finding his wallet the same day.

After making the drive back to the Cape to pick up the wallet, he discovered that the only thing missing from his wallet was his driver’s license. And the Good Samaritan told him that he found the wallet not at the restaurant or its parking lot but on the roadway outside making it unlikely that my client had lost it and more likely that he had been pick-pocketed.

There’s no way around the sense of dread you’ll feel if you can’t find your wallet … or your smartphone for that matter. Most of our lives are in there. From IDs to credit cards to medical insurance and even passwords, it’s all there for the taking. The best that can happen is you have to deal with the inconvenience and maybe embarrassment of losing the wallet. Perhaps you’ll be out some cash (which is why Karl Malden and American Express would always say never carry cash but instead carry AmEx Traveler Checks). And the worst that can happen is becoming a victim of identity theft and dealing with the countless hours trying to fix it.

According to the Federal Trade Commission, the most common forms of identity theft include credit card fraud, bank fraud, communications services fraud (such as opening a cell phone account), and obtaining fraudulent loans used to purchase goods or services.

In my client’s case, there were no test charges or unauthorized use. But the scary thing is that it’s possible that someone can use a driver’s license to assume a new identity which can boomerang back in unexpected ways. For instance, someone can use a stolen identity to get medical services sticking the true owner with the bill. Or perhaps a person gets stopped by the police and uses the assumed name. Then you may get an unexpected summons in the mail.

These are the twelve steps to help protect yourself from identity theft.

File a police report about your may wallet if you haven’t already. You should be able to do this in your town. Save the police report. In the event that someone does successfully open credit in your name you will have this documented.
Call your credit card companies and banks (at least the ones that were in your wallet) to alert them directly. Your liability is limited to $50 in the case of fraudulent use of credit cards. There’s no such limit for debit card use. The card companies do have very extensive fraud tracking so any charges that are outside of your normal pattern will trigger an alert.
You should arrange to have new credit cards issued. When an online hack happened to me earlier this year, I had the credit card company issue two cards tied to a new account number: one stays in my wallet and the other stays in my office safe to be used for online transactions only. In this case, if there were an online hack, it’s easier to simply shut off that one new card and not have to close out the entire account. Client services at the credit card companies can describe this option.
Add security features to your new cards and established accounts. You can arrange to have a temporary pin sent to you when trying to access your accounts online. This is referred to as second-factor authentication. If a thief doesn’t have your phone or email, they won’t be able to get in. You can also arrange to have extra security questions answered whenever the account is accessed or calls made to client service that involve cash advances or credit limit increases for instance.
Call to have a credit freeze on your account. The major credit reporting services may charge a fee ($5 to $10) which is waived if you are a Massachusetts resident and can show them a copy of the police report. Credit freezes are good for 90 days but can be extended.
Contact the Federal Trade Commission and file a report which will also be used to alert the IRS. You can call the FTC at 1-877-IDTHEFT (1-877-438-4338). You can use this resource from the Federal Trade Commission to guide you through: https://www.consumer.ftc.gov/articles/0497-credit-freeze-faqs
You should call the major credit reporting firms to report this as well. You’ll find the phone numbers for the credit reporting firms on the FTC website as well.
Monitor your credit. I recommend establishing an account through CreditKarma.com. You’ll be notified if you have any new hard credit inquiries which could alert you to unauthorized use. If you’re not comfortable with this you can schedule to get your free credit report from each credit bureau (one from each bureau free per year). You can use www.annualcreditreport.com . I suggest staggering the requests so that you get one free from each in four-month intervals.
Contact your Registry of Motor Vehicles to report your license as stolen. They will flag your license in case someone tried to use it. You may be better off asking for a new license number but the RMV can best advise on this. http://www.massrmv.com/LicenseandID/ReplacingALostLicense.aspx
Thinking ahead, you’ll want to file your next year’s tax return as soon as possible next year (late January or early February). If someone did hack your tax ID/SSN, they may want to file a tax return to claim a refund. The person who files first wins.
You should change your passwords on your websites that you use. It’s a good idea to do this periodically anyway. I recommend using a password manager that may help you create and track strong passwords. Check with your anti-virus software first. Microsoft includes something in its Windows operating software. I have used Kaspersky and Symantec Norton and each offers this. But I use LastPass, a dedicated password manager program.
Contact your insurance agent. You may have identity theft coverage as part of your homeowner’s insurance policy which can help defray some of the costs that you may incur trying to recover your identity.