Identity Theft

The FTC took in more than 1.3 million identity theft reports in 2025, and credit card fraud was the biggest chunk. Most of it is not a stolen card. It is brand new accounts opened in somebody else's name with stolen information. That is exactly the kind that shows up as a collection call for a debt you never took out.

The Different Kinds

• New account fraud. Someone opens a card, loan, or utility account with your information. Most common, and most likely to land in collections.
• Existing account fraud. Someone uses the card or bank account you already have.
• Tax identity theft. Someone files a return with your Social Security number and takes your refund.
• Medical identity theft. Someone gets care or prescriptions billed to your insurance.
• Criminal identity theft. Someone gives police your name instead of their own.

Signs to Watch For

• Accounts or hard inquiries on your credit report you never opened
• Collection notices for debts you know you never took out
• Getting turned down for credit for reasons that do not match your real history
• A tax return bounced because one was already filed under your number
• Medical bills or insurance statements for care you never got

Do These Things First

1. Report it at IdentityTheft.gov. That gives you a recovery plan and an official FTC Identity Theft Report, which you need for the next steps.
2. Put a fraud alert or a credit freeze on your file with that report in hand. Which one to pick is below.
3. Dispute the fake accounts with both the company and the credit bureaus.
4. If your taxes got hit, file IRS Form 14039, the Identity Theft Affidavit.

Freeze or Fraud Alert?

Both are free. They do different jobs.

A credit freeze blocks new lenders from seeing your report at all, so nobody can open an account, including you, until you lift it. It lasts until you take it off and does not touch your score. You have to set it up with all three bureaus separately.

A fraud alert does not block anybody. It makes businesses verify who you are before opening something new. A basic alert lasts one year. With an FTC Identity Theft Report or a police report you can get an extended one that runs seven years. You only contact one bureau. They have to tell the other two.

Neither one protects the accounts you already have. For those, you still have to read your statements.

Not sure? The freeze is stronger and the better pick if you are not applying for credit soon. The alert makes more sense if you want protection without lifting a freeze every time you apply for something.

When a Collector Calls About a Debt That Is Not Yours

You have the right to dispute it and demand proof before you pay a thing. Send a debt validation letter and read up on your rights under the FDCPA. Do not pay to make it go away.

Sources

FTC Consumer Sentinel Network (2025 identity theft report data), IdentityTheft.gov, FTC Fair Credit Reporting Act guidance on credit freezes and fraud alerts, IRS Form 14039.