Harv's Corner 05/26/2025

Harv's Corner

Terry Savage is a nationally recognized expert in personal finance, known for her straightforward and common-sense approach to money matters. With a background as a stockbroker and a pioneering female trader on the Chicago Board Options Exchange (CBOE) and the Chicago Mercantile Exchange (CME), Savage brings decades of experience in the financial markets to her work.

IDENTITY THEFT AND WHAT TO DO!

​It makes sense to assume your identity has — or will be — stolen! Ever since the Equifax breach two years ago, the “dark web” has the names, birth dates, addresses, and Social Security numbers of millions of Americans! Now, that information is being used to scam states out of unemployment benefits. And you may not even know that your identity has been used until you receive a 1099 tax form from the Government in January demanding taxes on money that was supposedly distributed to you from state unemployment offices or even the SBA’s PPP program! So if you never applied for unemployment but suddenly receive a debit card, or a letter from your state unemployment department, here’s what you should do.

SPECIAL UPDATE FROM IRS 02/21/21
The IRS has put up a short, but helpful page, telling taxpayers what to do if they are victims of Identity Theft fraud related to unemployment benefits. As I have previously written, although they advise asking your state for a corrected 1099G, that is unlikely to happen given all the confusion. Instead, you should file “an accurate federal tax return reporting only income received.” That is, do NOT report income from a fraudulent 1099G that you received. Here is a link to the new IRS page on Identity Theft and Unemployment Benefits.

SPECIAL NOTE TO ILLINOIS RESIDENTS RE UNEMPLOYMENT FRAUD 01/27/2021
The very messed up IDES website has made just a promise and posted a link! The promise is that if you report fraud on their site you will not receive a 1099G form, reporting those fraudulent earnings for tax purposes. It’s hard to believe that IDES will be that organized! But if you even suspect unemployment fraud in Illinois, here is the new link to report it online at IDES:
https://www2.illinois.gov/ides/Pages/Report-Identity-Theft.aspx

​ BE SURE TO TAKE A SCREEN SHOT OF YOUR FRAUD FORM BEFORE SUBMITTING! (Just push the “prnt scrn” button on your keyboard, and then paste it into an email to yourself!) If you DO receive a 1099G from any state for unemployment benefits that you did not receive, you must contact the state to re-issue the 1099 in a corrected form (Good luck with that!) And don’t ignore that 1099G on your Federal tax return, because the state will share that info with the IRS. Instead the IRS suggests putting a note — even on electronic forms — alerting the IRS to the fraud. No idea how that will be resolved, but I will update this post when more news is available!

Get Your Credit Report
Below are links to contact each of the three credit bureaus. The first step is to FREEZE YOUR CREDIT. There should be NO COST to freeze your account and to get your credit report online, immediately. Keep your secure PIN so that you can easily lift the freeze if you want to allow a company to check your credit, perhaps in a job search, insurance purchase, or mortgage refinancing. Here are the direct links to the CREDIT FREEZE pages at each of the three bureaus:

Here is the link to the freeze Page on Transunion’s site: https://www.transunion.com/credit-freeze

​Here’s the link at Experian: https://www.experian.com/freeze/center.html

And here’s the link at Equifax: https://www.equifax.com/personal/credit-report-services/credit-freeze/

You can get a free copy of your report from each of the three bureaus by going to AnnualCreditReport.com. Or call the numbers below: TransUnion 1-800-916-8800 www.Transunion.com
Equifax 1-800-685-1111 www.Equifax.com
Experian 1-888-397-3742 www.Experian.com

The whole idea of freezing your credit report is so that no one can use your identity to open NEW ACCOUNTS in your name. But you still must be vigilant about your existing bank and card accounts to make sure no one is using them for fraudulent purposes.

READ Your Credit Report!
You are looking for “inquiries” into your credit. Many people have reported a “soft inquiry” from a state unemployment bureau. Typically they then receive one of those fraudulent debit cards. Make sure you do NOT ACTIVATE any debit card. BUT, you may also see an inquiry from a bank or credit card company that you do not recognize. If you see a bank inquiry, contact that bank to make sure someone did not open an account in your name. Bank accounts do NOT appear on your credit report, but an inquiry will be a tip-off that you are a victim of identity theft. AND, if you see an inquiry from the SBA (Small Business Administration) contact them immediately. I have heard from several people that small business loans were taken out in their name — and they had no idea! Contact the SBA inspector’s office at (800) 767-0385.

Contact the FBI
The FBI has an active, nationwide investigation into Unemployment-related Identity Theft. In addition to trying to report fraud to the unemployment office and banks issuing benefits cards, they ask you to report directly to the FBI — and promise that your tip, whether by phone or online — will be read by TWO agents.

1-800-CALL FBI

Tips.FBI.gov Report Suspected Fraud to the Unemployment Department
You may not get through by telephone, search for the word FRAUD on your state unemployment website. Report your suspicions online immediately. And keep proof that you did! Directions below.

Report Suspected Identity theft to Social Security and the Federal Trade Commission You can contact the Social Security Office of the Inspector General’s fraud hotline at 1-800-269-0271 or submit a report online at https://oig.ssa.gov/. Since the IRS checks with Social Security regarding income attributed to your number, you want them to know your identity might have been stolen. That way, if you get a 1099 for income from unemployment, you will have one more level of proof that it wasn’t yours! (By the way, at www.Socialsecurity.gov, you can check your own personal account safely and securely online, using the “My Social Security” tool. Here is a link to that page. Checking your own benefits history does more than let you know what your monthly check is likely to be at retirement. It allows you to make sure your employer is contributing appropriately AND make sure that no one else is using your SS number in a fraudulent way.) Surprisingly, the Federal Trade Commission is the nation’s consumer protection agency. You can call them at 1-877-IDTHEFT (1-877-438-4338); (TTY 1-866-653-4261); or call 1-800-908-4490. Also, you should file an online complaint with the Internet Crime Complaint Center (IC3) at www.ic3.gov.

Keep Track of Your Attempts to Report Fraud
You might need to prove you tried to report any attempts at fraud. Here’s how to do that: Every time you file an online fraud complaint, take a screen shot of the filing page. (You can do that by pushing the button at the top of your keyboard marked “Prt Scr”. ) Then send yourself an email and “paste” the “screen shot” in the body of the email. You do that by clicking in the body of the email and if you don’t see the word “paste” come up, just press CONTROL +V at the same time, and the picture of the screen shot will appear in the body of the email! Save those emails that you send to yourself in a special folder. That will let the IRS know you tried to report fraud when it happened. And that will be useful if you receive a 1099 form next January asking you to pay taxes on the “unemployment benefits” your allegedly received – but, of course, didn’t!

Keep a Close watch on your Credit and Bank Accounts
Freezing your credit denies fraudsters the opportunity to open NEW credit in your name. But you must still check your accounts — bank and credit — on a regular basis online for unauthorized activities. Do this at least once a week. Change your password if you suspect identity theft might have occurred. Make sure you do your online checking from a SECURE WI-FI connection — not at a library or restaurant! Report any unexpected bank deposits, as they may be a prelude money being wired OUT of your account. And if you are offered “two-factor” identification (requiring confirmation by text or email of significant transactions) take a moment to set that up. Your goal is to BE AWARE, BE CURRENT, BUILD A FORTRESS AROUND YOUR CREDIT — and take action immediately if you think something is wrong.
Better safe than Sorry. That’s a Savage Truth!