Debt collectors can notify consumers about fraudulent charges and work through the situation with consumers.
Last year, about 17.6 million consumers in the U.S. age 16 and older reported at least one incident of identity theft, according to the report Victims of Identity Theft 2014 by the Bureau of Justice Statistics. While reported cases of identity theft have remained fairly steady since 2012, the report did show that debt collectors are playing a vital role in alerting consumers about suspicious activity on their accounts.
The report found that existing bank accounts (38 percent) or credit card accounts (42 percent) were the most common forms of information misused by identity thieves.
Overall, 16.4 million consumers reported the unauthorized misuse or attempted misuse of an existing account in 2014.
According to BJS statistician Erika Harrell, Ph.D., most victims of identity theft hear about it through their financial institution.
Forty-five percent of identity theft victims learned about it through their financial institution compared to 18 percent who found out when they noticed fraudulent charges on an account, according to Harrell’s report.
Overall, debt collectors are the seventh most likely group or business to notify a consumer about identity theft, according to Harrell’s report.
When a consumer is a victim of “other identity theft,” meaning anything outside of stealing from one of their existing accounts, 13.8 percent report that communication with a debt collector alerted them to the fraud.
Less than 3 percent of all identity theft victims ended up communicating with debt collectors “about charges and bills that were made as a result of the ID theft,” Harrell said. If the identity theft occurred with an existing consumer account (which is the case in a majority of identity thefts), then the percentage of consumers communicating with debt collectors falls to 1.6 percent.
In July, ACA International reported on results of the 2014 Consumer Complaint Survey Report showing that identity theft was the fastest-growing complaint at the state and local level in 2014.
Legitimate debt collectors are not consumers’ enemies are not interested pursuing a debt that is not owed. Consumers may receive contact from a debt collector about a balance they reportedly owe resulting from unknown theft of their credit or debit card. Collectors will work through the situation with consumers and can provide resources.
It is good practice for debt collectors to help victims of identity theft in any way they can. ACA members can access more information on duties of debt collectors working with victims of identity theft through ACA SearchPoint: Debt Collectors and Identity Theft. ACA members must be logged into ACA’s website to access SearchPoint documents.
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For more information about debt collection for your business, contact McHughes Law Firm at 501.376.9131 and schedule a free legal consultation.