Identity theft is when someone uses your personal or financial information — your Social Security number, a credit card, your bank account details, or your health insurance information — without your permission. This guide walks you through how to prevent identity theft, safeguard your personal information, and protect against fraud and other criminal activities.
How to Prevent Identity Theft: 7 Steps You Can Take Today
Most identity theft victims don't discover the crime for three months or longer, making prevention far more valuable than recovery.
1. Protect Your Sensitive Documents
Your physical documents contain some of your most valuable personal information:
- Keep financial records, Medicare cards, and Social Security cards in a secure place at home.
- Shred financial statements or black out sensitive details with a marker before disposal
- Collect your mail daily to prevent theft from your mailbox.
2. Use Strong Passwords For Online Accounts
Use a different password for every account, especially financial accounts. A password that’s hard to hack typically includes a combination of upper and lowercase letters, numbers, and symbols.
It’s also helpful to enable two-factor authentication (2FA) when possible. This works like getting a second key: after you type your password, they send a number code to your phone that you must enter. Even if someone guesses your password, they won’t get access without that second code.
3. Monitor Your Credit Report
Your credit history is like a report card that shows all your loans, credit cards, and payment history. If someone has opened a new account without your permission, it’ll show up on your credit report.
You can access your credit report for free at AnnualCreditReport.com — this is the only official government website for free reports. Look for:
- Accounts you didn't open.
- Loans you didn't take out.
- Late payments that you know you made on time.
4. Check Financial and Medical Statements
Set aside a few minutes each month to go over your financial paperwork. If there’s a charge you don’t remember making, even a small one, call your bank to ask about it.
Pay attention to whether your regular bills arrive on time. If something is missing, it could be a warning sign that someone has changed your mailing address or is tampering with your mail. Keep in mind that many scams target people who receive Social Security. If you receive retirement income, make sure you understand when you’ll get your Social Security payments.
Also, check your explanation of benefits (EOB) from your insurance provider. If you see medical services you didn’t receive, it could be a sign of healthcare fraud.
5. Sign Up for Alerts
Most banks and credit card companies offer free alerts that send text messages or emails when your card is used, a new deposit hits your account, or a withdrawal is made. This way, you’ll get a warning sign right away if something looks off, so you can take action quickly.
If you’re a Charlie customer, be sure to activate Charlie FraudShield, which helps monitor your account activity and alert you to suspicious transactions.
6. Freeze Your Credit to Prevent Fraud
A credit freeze is one of the strongest identity theft protections available. It blocks new credit accounts from being opened in your name. Even if someone gets your information, they can’t use it to apply for loans or credit cards.
Here’s how to freeze your credit with each of the three major bureaus:
It’s free to do, and you don’t have to contact all three. Just notify one credit bureau, and they’ll pass it along to the other two. It doesn’t affect your score, and it’s one of the most effective steps you can take when learning how to prevent identity theft.
7. Avoid Phone and Email Scams
If someone calls claiming to be from Medicare, the IRS, or your bank — hang up. It might be a spam phone call. The IRS won't ring you up demanding immediate payment over the phone. Your bank won't text asking you to "verify" your account by clicking a link. Medicare won't email requesting your card number.
If you’re unsure, find the company’s official phone number (not the one that called you) and call to verify. The real customer service folks will tell you right away if there's a problem with your account.
You also should never click on links you don’t recognize in emails or texts. Even if they look real, they could be attempting to steal your information.
How Identity Theft Happens
Knowing how thieves operate helps you stay one step ahead of their tricks. Here are the most common ways crooks get their hands on your personal information.
Lost or Stolen Wallets
Don’t make the mistake of carrying too much sensitive stuff in your wallet. Leave your Social Security card at home. Those store credit cards you use twice a year? Keep them in a drawer instead of your wallet. And don't write down your PIN on a sticky note and tuck it behind your debit card.
For extra peace of mind, Charlie customers can activate Sleep Mode. It lets you turn your Charlie Visa Debit Card off when you’re not using it — instantly or at times you choose.
Stolen or Tampered Mail
Identity thieves can swipe bank statements or even redirect your mail to their address without you knowing. Sign up for USPS Informed Delivery to get pictures of what's coming each day so you'll know right away if something goes missing.
Widespread Data Breaches
Most major companies have had a data breach at some point, which can put your sensitive information in the wrong hands. That’s why it’s important to check your credit report and scan your statements for anything that doesn’t belong.
Phishing Emails and Fake Calls
Identity thieves may pressure you to share personal details by phone, email, or text. Don’t respond. Instead, look up the real contact info and verify the message.
Some identity thieves use emotional pressure or fake financial opportunities to build trust and steal information. Here’s how to spot and avoid them.
Card Skimming at Gas Stations and ATMs
Skimmers are tiny devices thieves attach to card readers, often at gas pumps or ATMs, to steal your card information. Use chip cards (the ones with the small silver or gold square) when possible, and pay inside when you can.
Charlie customers get added protection with FraudShield and SpeedBump, which activate during high-risk moments, such as large transfers or unfamiliar device logins.
Looking Over Your Shoulder
Some identity thieves don’t need tech, they just need a good angle. Someone nearby might watch you enter a PIN or snap a photo of your card. Cover the keypad with your hand, and never set your card down on a counter where others can see it.
How To Report Identity Theft
If your identity is stolen, don’t panic. These simple steps can help you start the recovery process and protect yourself from further damage:
- Report it to the Federal Trade Commission (FTC): Go to IdentityTheft.gov to file a report and get sample letters to send to credit bureaus and companies.
- Contact banks or creditors right away: Let them know what happened and ask them to freeze or close any affected accounts. Update your passwords and request a new card or account number.
- Add a fraud alert to your credit: Contact one credit bureau (Equifax, Experian, or TransUnion) to request a free fraud alert. They’ll notify the other two, and lenders will be asked to verify your identity before opening new accounts.
- Change your login details: Update usernames, passwords, and PINs for your online accounts.
- Watch your accounts closely: Check your credit report, bank statements, and medical bills for any unfamiliar activity.
- Consider filing a police report: If you have proof of fraud or need it for insurance or legal reasons, file a report with your local police. Bring your FTC report, a photo ID, and any supporting documents.
FAQ
What Should You Do When Your Identity Is Stolen?
Start by placing a fraud alert with one of the three major credit bureaus. Then file a report at IdentityTheft.gov, contact affected companies, change your passwords, and keep a close eye on your accounts for unusual activity.
How Do I Know If Someone Is Using My Identity?
Check your credit reports regularly to see if someone has opened accounts in your name, and contact those companies right away if they have. Sign up for credit alerts from the credit bureaus so they can notify you of any changes. Also, check for missing mail, especially financial statements, which could indicate address changes you didn't make.
What Is the Best Protection From Identity Theft?
There’s no single solution, but hard-to-guess passwords, credit monitoring, and staying alert to suspicious activity go a long way. Freezing your credit, signing up for fraud alerts, and regularly reviewing your statements are some of the most effective steps.
Content in the Customer Resource Center is for informational purposes only, and you should not construe any such information or other material as legal, tax, investment, financial, or other advice.