TypewriterFrom The Urbach Letter July 2012

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Your Wallet is Gone

Was it stolen or just misplaced? A preliminary search turns up nothing. What now? These days, you can't afford to wait and hope for the best. In this age of rampant cyber crime and identity theft, time is NOT on your side, and you must assume your wallet is now in the possession of someone with evil intent. You'll need to take immediate and decisive action to protect yourself from financial loss, or worse...

Here's the quick list of 8 things you must do:

  1. Notify your bank
  2. Notify the major credit card companies
  3. Cancel/replace all other (store, gas, etc.) credit cards
  4. Report the loss/theft to the police
  5. Replace your driver's license
  6. Cancel and replace other cards (library, gym, etc.)
  7. Contact your insurance companies
  8. Order a credit report and initiate a fraud alert

Detailed Instructions

1. Notify your bank

Your ATM/debit card inherently carries more risk than a credit card. If unreported, you may be liable for all withdrawals and even overdraft charges. However, once you notify your bank, your associated debit card liability is limited to a maximum of $50. If you carry checks in your wallet (not recommended), then you have even more to worry about. No federal law caps your losses if someone forges your signature or otherwise fraudulently withdraws money from your checking account. State laws generally hold the bank liable in these instances... but only if you "take reasonable care" of your account. In this situation, that reasonable care may include closing your account and reopening a new one. Once an account is closed, your bank will notify its internal processors about the closure but you should still contact all three of the following check verification services used by many merchants. Doing so will prevent the bad guys from using your check at a retail store, and may even lead to their apprehension:

Check verification services

  • TeleCheck 1-800-710-9898
  • Certegy Inc. 1-800-770-3792
  • International Check Services 1-800-631-9656

Of course, for good measure, you will also change your PIN, account passwords, etc. Right?

2. Notify the major credit card companies

Cancel all of your major credit cards immediately (Visa, M/C, Amex, Discover). They'll send you replacement cards with brand new numbers. By default, these will come to you in regular postal mail, but you can often expedite this by requesting overnight delivery. There may be a fee, which could be waived if you're a good customer or have a good story to tell. Be prepared to spend a little time with the phone rep going over recent transactions recorded to your account to determine if they're legitimate.

3. Cancel and replace store/gas cards

Many people fail to do this. Mistake. Unfortunately, many store cards have less stringent security policies than the majors, and less lenient treatment of improper charges. Crooks know this, and often ring up big ticket purchases at places like Home Depot. Many stores have short (e.g. 48 hour) deadlines to report lost/stolen cards to avoid liability.

4. File a police report

Does this sound like overkill to you? It's not. While the police will likely not do anything to assist recovery, reporting the loss/theft is an essential aspect of fraud prevention. You will have to personally visit a station to file the report, but will walk away with a police report. This will be helpful in numerous ways: in filing insurance claims, showing to an officer if you're stopped prior to obtaining a replacement license or ID, and for avoiding liabilities if your identity is stolen.

5. Replace your driver's license

The nice people at your friendly Department of Motor Vehicles will be very sympathetic to your loss, offer their heartfelt condolences, allow you to phone in the request, waive all replacement fees, and not even require a police report. Just kidding. They're going to make you do all those things: appear in person, wait in line, supply a police report, and pay a fee to replace your license. What did you expect? (Actually, the procedure varies state-by-state, with some, like New York, making replacement much easier than others. This site will help you determine what's what: DMV.org)

6. Cancel and replace all your other cards

Again, this may seem like overkill; until three months later, when you get a big overdue notice from your library for all the books and DVD's checked out by your card pilferer and never returned. Also get your supermarket reward cards voided, along with your gym membership card and others of this type. Doing so provides an (admittedly small) extra measure of protection against identity theft.

7. Contact your insurance companies

You absolutely don't want a crook using your medical insurance card. This can lead to multiple nightmare scenarios. Medical identity theft is the worst. If a bad guy uses your insurance card for, say, emergency room treatment, his "conditions" are now yours. This is very hard to reverse, and people have been denied for insurance coverage over things just like this. A woman was nearly given the wrong blood type during surgery because "her" records were corrupted by those of a methamphetamine addict. On the brighter side, notify your P&C (homeowners) insurance agent, who may tell you that you have coverage for loss and identity theft remediation.

8. Order a credit report and initiate a fraud alert

Your last immediate task is to request a credit report on yourself and put a fraud alert in your file. The credit report is (truly) free at www.AnnualCreditReport.com. Be aware of similar-sounding (but not free) web sites and services. Most of them are cheesy and spammy, but you can trust annualcreditreport.com.

Next, start a fraud alert at Experian, TransUnion, or Equifax. They inter-report, so you can just pick one.

Credit Bureau Contact Information

  • Equifax
    Call: 1-800-525-6285,
    and write: P.O. Box 740241, Atlanta, Ga. 30374-0241

  • Experian
    Call: 1-888-EXPERIAN (397-3742),
    and write: P.O. Box 9532, Allen, Texas 75013

  • TransUnion
    Call: 1-800-680-7289,
    and write: Fraud Victim Assistance Division,
    P.O. Box 6790, Fullerton, Calif. 92834-6790


The service is provided at no charge and will monitor your credit for 90 days. Then if you (or someone else) attempts to set up a new account or obtain credit you'll get a phone call to confirm it's really you.

Doing all this is a hassle, and you'll be tempted to cut corners or delay. Don't.

Realistically, how long should you search before beginning this process? If you're in a public place, spend about 15 minutes retracing your steps. At home, maybe spend an hour looking around before you "push the red button." If your wallet turns up later on, somewhere, somehow, no real harm will have been done by taking the prudent steps outlined here. If found, however, be sure to destroy all the old cards (especially the magnetic strip).

Will all this negatively affect your credit rating? Yes. Sorry, it probably will. However, not by much and not for long. Compared to other credit transgressions, reporting a loss and closing accounts after a breach are minor events.

I'll have more on this topic for you in August, including the smart, preventative things you should do while your wallet is still safely in your pocket or purse.

-V-

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(c) Copyright 2002-2012 Victor Urbach
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may be reprinted with permission and attribution