Published: September 2015
You may monitor your credit report, shred your mail and keep a watchful eye to make sure that your identity hasn’t been stolen. But do you also consider identity theft when a loved one passes away? Unfortunately, the risk for identity theft does not stop at the end of life. According to a study by ID Analytics, more than 2.5 million deceased Americans are victims of identity theft each year.
The Identity Theft Resource Center (ITRC) says that this crime, called ghosting, is often committed by thieves accessing the Social Security Administration’s Death Master File. The file contains personal information of about 86 million people and can be accessed by organizations such as financial institutions and credit companies for a fee.
Common scenarios include identity thieves filing fraudulent tax returns or using the deceased person's Social Security number to open new credit cards, according to IDT911. While surviving family members typically aren't held responsible for fraud charges that ghosting can incur, keeping your love one's name clear may be important to you as you honor his or her memory. You can help prevent ghosting by taking the following steps:
Identity theft might be the last thing on your mind as you write the obituary, but what the public announcement says could accidentally give clues to potential identity thieves. The Internal Revenue Service recommends leaving out the birth date, address and mother’s maiden name. The same goes for social media: Don't post identifying details when remembering your deceased loved one.
Typically, the funeral director will notify the Social Security Administration of the death. Once you receive the death certificate, the IRS suggests mailing official copies (not photocopies) via certified mail to the three major credit bureaus — Equifax, Experian and TransUnion — to request that a deceased alert be placed on the credit report immediately. The IRS also asks that you send them a copy of the death certificate.
It is essential to make sure that all current accounts are closed. The ITRC recommends notifying credit card companies, banks, stock brokers, loan holders and mortgage companies by sending a certified death certificate.
Some families skip this step if there is a surviving spouse — check with your financial institution if you have a joint account regarding the best action to take in your situation. When closing accounts, the ITRC recommends you have the institution mark it as “Closed. Account holder is deceased."
Even after taking these precautions, identity theft is still a possibility. Check your deceased loved one's credit reports to look for credit activity. If you see credit activity after the date of death, contact the creditor, credit bureaus and police immediately.
After the loss of a loved one, the last thing you need to worry about is fixing damage from identity theft.
Identity restoration coverage, typically sold as an add-on coverage to your auto or home insurance policy, can help with the notification and credit monitoring process if you suspect a deceased family member's identity has been compromised. Talk with your agent to see if this type of coverage is an available option on your family's policies.