Financial firms helping victims of identity theft

More companies set up programs to fight fraud and help customers recover their good names

October 02, 2005|By EILEEN AMBROSE | EILEEN AMBROSE,SUN REPORTER

THE PROGRAMS — Financial companies are adding new programs to help customers recover their stolen identities, responding to the millions of fraud cases so far and consumers' fears that they could be next.

The programs - offered by credit-card, insurance and other companies - have cropped up in the past two years, coinciding with heightened public awareness of identity theft. Credit-card giant Citibank, for example, launched a free service for its customers in 2003 to combat identity theft. It has been promoting the program through a series of television advertisements where victims speak in the voice of their identity thief.

The goal of these services is to help victims navigate the process of contacting creditors, credit bureaus and authorities so they can get their financial life back in order. Some programs offer more hand-holding than others, making follow-up calls with customers and monitoring credit reports for suspicious activity.

"Identity theft management is a growing industry. We are at the beginning of the curve," said Pam Dixon, executive director of the World Privacy Forum, a San Diego nonprofit that researches privacy issues. Financial institutions are smart to offer such services for free to customers, she added. "It saves them money by reducing fraud, and identity theft [assistance] is a good customer relationship opportunity."

The Federal Trade Commission released a widely publicized report two years ago that said 27.3 million Americans had been victims of identity theft in the previous five years, with 9.9 million of those cases occurring in 2002 alone. Companies lost nearly $48 billion to identity theft in 2002, and victims paid $5 billion in out-of-pocket expenses, the FTC said.

Insurance giant MetLife added an identity theft service in June to all its policies for renters, condominium-owners and homeowners at no extra cost to customers. ID theft victims can get one-on-one assistance with contacting credit bureaus, placing fraud alerts, dealing with creditors and police, preparing needed documents and other steps necessary to recover their identity.

Early customer survey results show an uptick in loyalty to MetLife and its products because of the ID theft program, said Matt Cullina, product development manager of MetLife Auto & Home in Warwick, R.I.

Citi's Identity Theft Solutions is based in the card company's sprawling processing center in Hagerstown.

Officials there say they designed the program to deal with the financial and psychological issues ID theft victims face.

"They call and they are extremely agitated," said Ronni Burns, Citi's director of business practices. "It's very scary when you realize that your wallet or personal information has been stolen and to figure out that somebody is impersonating you."

Calls are routed from around the country to the Hagerstown center when Citi customers are likely victims of identity theft.

Recent calls came from a woman who fell for an e-mail scheme seeking her financial information, a man whose account data may have been obtained by a computer hacker, and an elderly Marylander who had been robbed of his wallet. Each customer is assigned a caseworker, so they deal with the same person throughout the process.

Pull credit report

Caseworkers pull a customer's TransUnion credit report and talk with them about inquiries made and any new accounts opened during the past year.

"Anything they are suspicious of or not able to fully confirm, we flag and can look at in further detail," said Jeffrey Bashore, Identity Theft Solutions operations manager.

With the customer still on the phone, the caseworker will contact TransUnion, which will mark disputed items, put fraud alerts on the file and send the information to the other two major credit bureaus. Citi will assist customers with filing police reports and contacting other creditors, Bashore said.

Customers receive an identity theft tool kit, with the names and telephone numbers of those who have been contacted. Caseworkers follow up with periodic calls to the customer. The customer's credit reports also are monitored for three months, or more if the case takes longer.

For competitive reasons, Citi says it won't disclose the size of its identity theft staff, call volume or the cost to the company.

"It's not inexpensive," Burns said.

In recent telephone conversations recorded and edited by Citi to protect customers' privacy, consumers appeared relieved to have someone walk them through the process.

Evan Hendricks, editor of Privacy Times newsletter, praises Citi's program, saying it cuts through much of the red tape in cleaning up an identity theft case.

"If you can get the credit grantor to tell the credit bureau you are right, that's the short cut," Hendricks said.

Too many other companies' programs fall short, sometimes merely selling customers identity theft insurance, Hendricks said.

"That doesn't do anything for people. They really need concierge service and hand-holding," he said.

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