How To Recover From Identity Theft

Written By: Matt Casadona
Reviewed by: Mike Reyes
Last Updated January 10, 2023

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You might ask yourself, “How can I recover from identity theft.” Millions of people are at risk every year. Typical forms of identity theft include fraud, credit card skimming, and even stealing your mail. Identity theft can have major implications on your entire life. If your identity is stolen, someone might use your personal information to take out credit card debt in your name, which can impact your financial health and credit score. 

If you fall victim to identity theft, your main goal should be clearing your name and reporting fraud. Unfortunately, many people who have their identities stolen don’t realize it until it’s too late, making it difficult to clear their names quickly and remove fraudulent activity from their credit reports. When your identity is stolen, you must act fast. This article will cover what to do if your identity is stolen and how to prevent it. 

Recovering From Identity Theft

Early detection is key for recovering after your identity has been stolen. Unfortunately, the longer the theft has been going on, the worse the impact can be, damaging your credit history and costing you time and effort. Here’s what to do if you find fraudulent charges on your credit or debit card or inaccurate information on your credit report. 

Notify Creditors and Banks

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Contact your bank immediately if you see a fraudulent charge on your credit or debit card. Most credit cards come with protections for victims of identity theft. The Fair Credit Billing Act also protects you, so the maximum liability you have for unauthorized or fraudulent charges is only $50. 

If your credit or debit card has been lost or stolen, you should report it before any fraudulent transactions occur. Otherwise, you might have a short window to report unauthorized charges. 

Similarly, you must act quickly if you notice any information on your credit report that doesn’t make sense, such as a loan being taken out under your name. Report unauthorized loans to the credit bureau where you found the mistake so they can begin looking into the issue. 

No matter what you believe has been compromised, whether it’s a card or your credit report is showing unauthorized loans, suspicious activity should be immediately reported. 

You can file an identity theft report and a police report to be shared with your creditor to show them you’re taking the appropriate steps to resolve the issue. 

Use a Fraud Alert

Because fraud can make your credit score drop, you need to protect your credit from more damage that can last for years. You can contact three credit reporting agencies to request a fraud alert. The credit reporting agencies are:

  1. Equifax
  2. Experian
  3. TransUnion

You should also notify your CPA. Suppose your accountant is using professional tax software. In that case, they may have access to certain protections for you, including alerting credit records, access to identity theft restoration advocates, and notifications to banks. 

Fraud alerts are free and stay on your credit report for one year. You can also get a new alert after the first year to ensure security. An alert will make it difficult for other people to open accounts in your name, forcing businesses to contact you before issuing any loan. 

Review Credit Reports

Once an alert is set up, you’ll receive free credit reports from the three reporting bureaus. Review each report for any possible signs of fraud, including new accounts you never opened, inquiries you don’t remember, and payment histories that don’t make sense. Also, check your personal information to ensure it’s correct. 

If you’re looking for how to prevent identity theft, pull your reports every year to check for potentially fraudulent activity. 


Once you’ve found evidence of fraud on your credit report, freeze your credit. Credit freezes prevent reporting agencies from releasing your reports to creditors. Therefore, if a stranger tries to open up a credit card in your name, they won’t be able to because there is a credit freeze on your report. Freezing your credit is free, but contact all three bureaus to request it. 

Report Theft to the FTC

Once you’ve reported identity theft to the bank and credit bureaus, it’s time to contact the FTC. You can fill out an online form at and provide as many details as possible. By contacting the FTC, you’ll receive a free recovery plan to help you get back on track. You’ll also get an Identity Theft Report as proof your identity was stolen. This report can help you file a police report and may serve as necessary evidence when talking to one of the major credit bureaus. 

Talk to the Police

Filing a report with your local police department can help provide you with further proof of identity theft. Having a police report in hand can protect you from any damages caused by theft, such as owing money to a creditor. The police report should list all of your accounts affected and a copy of your Identity Theft Report from the FTC. 

Have Fraudulent Info Removed From Credit Report

After finding the fraudulent activity on your credit reports:

  1. Contact all three credit bureaus to have fraudulent information removed.
  2. Include a copy of your police report and Identity Theft Report from the FTC to prove that you have been a victim of theft.
  3. Be descriptive and include details about the fraudulent information so you can remove it from your report. 

Change Your Passwords

Identity theft can come from several places, including lost or stolen credit cards or cyberattacks. For example, if your favorite online shop got hacked, your information, including credit card numbers and addresses, could have been stolen. 

Someone may have also hacked into any of your apps to access your bank accounts. Once you find suspicious activity on your bank account, change all of your bank passwords and the passwords of anything associated with your account, including payment apps and eCommerce shop logins. 

Final Thoughts

If your credit score has been affected by identity theft, it can take years to go back up, depending on the damage. However, if you follow these tips, you can start protecting yourself and ensuring you won’t become a victim again. The best thing you can do after you’ve taken all of the necessary actions with the police, the FTC, and the major credit reporting bureaus, is to practice patience. Eventually, your credit score will return to a healthy number. 

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