One of the many disturbing aspects of identity theft occurs when an identity thief abuses your credit and you are both hounded by a debt collector attempting to collect payment for a debt you never incurred and this negative information gets reported on your credit report at each of the three major credit reporting agencies, Experian, TransUnion and Equifax. Your credit report does not only have a significant affect on whether you are going to be granted credit, but the information contained in your credit report is also used by employers in determining whether to hire you, by insurance companies in determining whether to sell you insurance and numerous other purposes. A big problem for many people continues to be clearing up your records when you become a victim of identity theft. Now, California has just passed a new law entitled the “Identity Theft Resolution Act” which will go into effect on January 1, 2017. This new law amends a former law and requires debt collectors who receive a police report or other similar documentation from someone reporting that they are a victim of identity theft to start an investigation within ten days regarding the claimed identity theft. The new law also requires the debt collectors to notify the credit reporting agencies about the claim of identity theft and upon concluding its investigation, the debt collector must send the results of the investigation to the credit reporting agencies within ten days. If the investigation indeed confirms that identity theft occurred and the victim did not incur the debts that appeared in his or her name, the debt collectors and the credit reporting bureaus are required to delete those claimed debts from identity theft victim’s records.
This law is a great step in the right direction and it is hoped that more states will follow the lead of California and pass similar legislation. It also emphasizes the importance of what I have said for a long time, namely that if you become a victim of identity theft, you should promptly file a police report to document the crime even if you have little expectation that the identity thief will ever get apprehended.
If you do become a victim of identity theft, go to the tab at the top of this page entitled “If you are a victim of identity theft” for detailed steps to take.