Each year, approximately 2.5 million Americans have their identity stolen... after their deaths. These stolen identities are used to borrow money, purchase cell phones, fraudulently open credit cards, etc., all of which can dramatically impact the liability exposure of the decedent's estate. Criminals may even file tax returns under the name of the decedent and collect refunds (totaling $5.2 billion in 2011) that rightly belong to someone you.
Welcome to the world of "ghosting": the theft of a deceased individual's identity.
How does "ghosting" happen?
Your identity as a deceased individual is perhaps more vulnerable to theft than your identity as a living individual. Suppose you pass away today. It can take six months or more for credit-reporting agencies, financial institutions, and the Social Security Administration to register your death records and share information that lets other governmental agencies and financial institutions know you are deceased. During that time, you aren't regularly checking your credit score or other financial information because, you know, you're dead.
Your identity may be stolen deliberately. A thief could get your personal information from an obituary, a funeral home, or hospital records. With your name, address, and birthday, they can illicitly purchase your Social Security Number for as little as $10. Alternatively, your identity may be stolen by sheer luck: A thief makes up a Social Security Number that just happens to match yours (think of it like picking lottery numbers).
You may not care whether your identity is stolen after your death (after all, you're no longer using it). However, identity theft is a very real problem that could affect the estate of a loved one and, in turn, affect you.
Is there any way to prevent "ghosting"?
So what can be done to protect your loved one's estate after their death? The short answer is this: "be vigilant." If you notice any suspicious activity on a deceased loved one's accounts, contact the institution and/or law enforcement to investigate. There are some other ways you can help prevent identity theft in the first place:
- Don't disclose too much personal information. This is key to preventing identity theft in general. For example, in obituaries, list the age of your loved one but don't include their birthday or their mother's maiden name or their home address.
- Send death certificates to credit bureaus. Send copies of the death certificate to credit-reporting bureaus — Equifax, Experian, and TransUnion — and ask them to place a "deceased alert" on your love one's credit report. Be sure to use certified mail with a "return receipt requested" when mailing this information (so you will know the bureau received the certificate).
- Send death certificates to financial institutions. Similarly, mail death certificates to banks, investment companies, credit card companies, brokerages, insurers, mortgage companies, and other institutions where the decedent owned accounts. For any joint accounts, simply remove the deceased individual's name.
- Report to Social Security. Report the death to the Social Security Administration by calling 1-800-772-1213.
- Cancel driver's license. Contact the DMV to cancel the decedent's driver's license. This helps prevent duplicate licenses from being issued to criminals.
- Check credit reports. Check the credit report of the decedent a few weeks after their death to see if there is any suspicious activity. A few months later, get another report from a different bureau.
It is often difficult to think straight after the death of a loved one, and focusing on financial matters and identity theft may be the last thing you want to do. But we highly recommend that you take the time to perform these preventative measures and lessen the possibility of an even bigger headache later on.
Protect yourself with a solid estate plan.
Identity theft is a problem whether you are living or dead. But during your lifetime, you can take steps that make it less likely your information and assets will be vulnerable to identity theft: namely, you can ensure that your personal information will be handled by people you trust — something you control through estate planning. To discuss creating or reviewing your estate plan, contact the experienced Oklahoma City estate planning attorneys at Postic & Bates today for a free, no-obligation consultation appointment.
[As with all our posts, the contents of this article do not constitute legal advice and are subject to our site-wide disclaimer.]