Identity theft according to the FCRA is a “fraud committed or attempted using the identifying information of another person.” Identifying information can include a victim's name, social security number, date of birth, registration number, passport number, and other identifying factors. It can be caused by the failure of the credit industry to protect a customer's file, leading to the potential use of a victim's identity by an impostor to take credit. In 2012, there were 369,132 reported cases, with more that 5.26% of U.S. adults as victims and over $21 billion stolen. 

For the victims, identity theft often causes inaccuracies at several levels of a consumer's profile. The thief can leave unpaid credit cards, empty out checking accounts, foreclosed mortgages, default judgments, bankruptcy declarations, and even arrest warrants. The thief's incorrect identity when used in the investigation can result in the victim getting undeserved repercussions. The cost to the victims in both time and money is disproportionate, with many having to live with consequences for months or years. A comprehensive study released by a national research firm reported that the average out of pocket expense to the victims is $373, and the average time to resolve identity theft cases is 21 hours. 

Child and foster youth identity theft is a commonality due to their lack of credit history. Children rarely check their credit reports. One survey calculated that among 40,000 foster youths, over 10% had someone using their social security number. Therefore, the federal law requires credit reports annually from youth in foster care, as an attempt to ensure credit authenticity. 

The Federal Trade Commission (FTC) holds most identity theft resources for victims. It can educate consumers about identity theft and provide means of contact for a victim to file a complaint. The victim can speak to customer counselors, fill out an identity theft affidavit form, and provide documents to the CRAs and financial institutions. The FCRA and other federal statutes also provide legal protections for identity theft. Most states in the U.S. have explicitly criminalized identity theft, enacting a special statute that bypasses the classic common law categories of offenses. These laws primarily prohibit a person from obtaining another's identity and using it without permission. Most impose criminal penalties for breaking the statutes. The state of California also recognizes that those who extend credit to thieves contribute to the victim's loss and therefore should also have liability. Therefore California's statute imposes two obligations on those who use consumer reports. The first addresses the discrepancy requirement which prohibits inaccurate information. The second obligation ensures that the person using a consumer report confirms that the applicant requesting an extension of credit is not the result of identity theft. If a creditor fails to properly investigate a claim of identity theft and continues to pursue the victim they may be liable for a statutory penalty of up to $30,000. 

If you or someone you know have been the victim of identity theft please contact the attorneys at Golden and Cardona-Loya, LLP for a free consultation.