Identity Theft Woes, Columnist David Lazarus Writes of His Own Experience

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David Lazarus, a columnist that writes for the L.A. Times, recently wrote about his own experience with Identity Theft that occurred 15 years ago but still plagues him today. A copy of his article that appeared in the Chicago Tribune on Sept. 4, 2012, is at,0,3447151,full.column. It’s a familiar tale with victims of identity theft, unfortunately. It’s a good read to understand why it is important to check your own consumer credit reports at least once each year, which you can do for free, and look for any accounts listed that you did not open or on which you are not an account holder.

There are steps you can take too that if done soon enough can prevent many problems that can result with identity theft. If that is a problem for you, we have more information on identity theft on our website,

ERISA Insurance Plan Cannot Recoup Benefits Against Insured’s Law Firm Says the 8th Circuit Court of Appeals

The federal court of appeals for the 8th Circuit recently decided an important case addressing whether an insurance plan could recoup payments it made for an insured against the insured’s law firm after the insured recovered for his claims. The Eighth Circuit rejected the plan’s claims against the law firm.

In Treasurer, Trustees of Drury Industries, Inc., v. Goding; Casey & Devoti, P.C., (8th Cir., No. 11-2885, 9/7/2012), an ERISA plan attempted to recoup against an insured’s law firm the benefits it paid out for the insured’s treatment after the insured recovered in a civil claim related to a slip and fall accident. The insured filed and obtained a discharge of the plan’s claim through bankruptcy. The plan then sued the insured’s law firm from the slip and fall claim. The Eighth Circuit held that the plan could not recover against the insured’s attorney under the contractual subrogation provision of the contract with the insured because the attorney was not party to the plan. The court also rejected the plan’s theory under equity and a state cause of action for conversion against the law firm.

Here is a link to the Justia summary and the decision:

When Someone Else Uses Your Social Security Number for a Job

When someone else is using your social security number for employment purposes, it presents a difficult situation to resolve. While the answer to how to stop this from continuing is not clear, there are some things you can do.

You can contact the Social Security Administration and the Internal Revenue Service to notify them of the fraud, as you want to avoid tax liability on this imposter’s wages. Also, the imposter could potentially open credit using your SSN, which would cause you additional problems. So you can contact the consumer reporting agencies to report fraud and ask them to put a fraud alert on your consumer file. Every employer is also required to verify the identity of an employee using a form I-9, which is governed by the Dept. of Homeland Security, formerly the INS, so you could notify the Dept. of Homeland Security. Also, the Federal Trade Commission accepts complaints of identity theft, as they keep a database and cross-reference complaints for potential action. You can attempt to file a police report of the fraud, but the local police department may not accept the report, as many are reluctant to do so if there doesn’t appear to be an economic loss associated with the matter.

Providing the identity of the employers where the fraudster worked and to these agencies may help get some interest going on to investigate to help you find out the identity of the person using the SSN.

The FTC has a very good guide on what to do when your identity has been stolen. Anyone that is victimized by identity theft should review that site and follow its recommendations.

For more information on what you can do, visit our website page on Identity Theft at

Supreme Court Balks & Consumers Win in First American Financial v. Edwards

Consumers and their attorneys were waiting with baited breath today for the decision by the U.S. Supreme Court in First American Financial v. Edwards. All breathed a sigh of relief today, June 28, 2012, when the high court of the nation decided not to decide this case, rejecting the appeal to the Supreme Court. Although the court initially said it would hear and issue a decision in the case, and the court waited until the last day of its term, the court found that the original basis for choosing to hear the case was mistaken and withdrew the certification of the case to the court.

This is actually a victory for consumers. The Ninth Circuit Court of Appeals, the lower court from which the case came, made a favorable decision for consumers, rejecting First American’s claim that a statute that provides for presumptive damages, known in the law as “statutory damages,” is unconstitutional. Had the Supreme Court agreed with First American, massive amounts of consumers would lose their day in court and it would have changed the landscape of consumer protection laws throughout the country.

In many consumer protection cases, the law provides that a court can award these presumptive or statutory damages where the consumer cannot prove actual damages. Congress has provided for statutory damages in consumer protection laws because violations cause harm beyond that inflicted on the particular consumer, it is a deterrent to break the law and actual damages can simply be hard to quantify and prove sometimes, though it is recognized that these violations do cause harm.

Some Federal protections that this decision could have affected include claims under the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, the Real Estate Servicing Protection Act, Truth-in-Lending violations and others.

NY Times on How to Increase Your Credit Score

How to Pump Up Your Credit Score, according to the New York Times, May 17, 2012:
According to the NYT, banks are tightening up lending requirements for mortgages and credit scores have a substantial impact on whether you can get a bank loan and what the interest rate will be. “A majority of banks are less likely to offer loans to people with a FICO credit score of 620 and a 10 percent down payment than they were in 2006 … [and] Lenders were also less likely to do so even for those with a score of 720.”
The two biggest factors that affect your credit score according to FICO, says the NYT, is “your payment history, which accounts for 35 percent of the score, and the amounts owed, accounting for 30 percent,” and  reducing your balances on credit cards can help improve credit scores under the FICO model. A late payment occurring during the month that you apply for a mortgage loan “can be deadly,” according to the Director of Counseling at the Housing Development Fund, Stamford, Conn.
For these reasons, at CELCWI, we advise people to get your consumer reports from Experian, Equifax and Trans Union through before applying for credit. Review the reports for any inaccuracies, and then dispute the inaccuracies with the consumer reporting agencies, in writing. If the inaccuracies continue after the disputes, consumers do have legal options to correct the reports and recover any resulting damages.

Easy Money—Rarely Is

The FTC just won a court judgment against three get-rich-quick schemes that promised big dollars in real estate in return for minimal investments. These schemes typically target financially stressed consumers. Here is the story:

The promises were the same ones you hear over and over, little to no money down and lots of money in return. The problem, less than one percent of the consumers that buy into the product ever see a return on the investment like the expectations the scheme creates. Oftentimes, these schemes bring you in for a small investment into their system and then give a hard sell to suck you into buying on their add-on products and “personal coaching” that really costs you.

The action by the FTC was against the marketers behind the infomercials for “John Beck’s Free & Clear Real Estate System,” “John Alexander’s Real Estate Riches in 14 Days,” and “Jeff Paul’s Shortcuts to Internet Millions.”

Posted in Advertising, Fraud

Misrepresentations in the Employment Relationship—By the Employer

Did you know that Wisconsin law prohibits an employer and anyone acting on its behalf from making misrepresentations to an employee or prospective employee with the intent or for the purpose of inducing the public to enter into any contract or other obligation relating to the terms of employment?
Seldom used for this purpose, but Wisconsin Statutes 100.18, part of Wisconsin’s Marketing and Trade Practices protections, prohibits such misrepresentations in many consumer transactions and the employment context. If someone suffers pecuniary loss–generally a financial loss—he or she can a claim that can be enforced in the civil courts of Wisconsin for that loss plus the costs of the action and a reasonable attorney’s fee. If there was a prior injunction in place as to the offending conduct, then the injured consumer may recover twice his or her pecuniary loss.
Wisconsin Statues 103.43 has similar prohibitions specific to misrepresentations made to induce someone to leave one job for another, but typically applies in manual labor settings.
This law, if applied in the employment context, could cover false statements of wages, salary and other employment compensation or benefits. It could also cover situations where the employer promises a position without ever intending to actually hire the consumer. These inquiries, and whether the law would provide any remedy, are very fact specific to each circumstance.

Mixed Files Found to be Big Problem in Credit Reporting

The 4-part investigative article published by The Columbus Post reports that one of the biggest problems found in consumer complaints to the FTC is with mixed files, where someone else’s information is appearing in your reports.

Of the 1,252 people who told the FTC that their files had been mixed with other consumers’, 30 percent also complained that the credit-reporting agencies failed to correct the mistakes after being asked. The others did not indicate whether they had sought to have the information corrected.

You can read the rest of the article at this link: TheColumbusDispatchonCreditRpts.

Good News Article on Problems with Credit Reporting Errors

The Columbus Dispatch has just published a great 4-part article investigating consumer complaints on credit reporting errors and its impacts. Here is a link: TheColumbusDispatchOnCreditRpts

Errors in Credit Reports due to Mixing and Matching a Relative’s Data Most Prevalent

The Columbus Dispatch reports, following an extensive investigation into consumer complaints at the FTC over a 2.5 year period, that almost 3/4th of the complaints involved consumer reporting agencies mixing someone’s relative’s credit data into their file. Of nearly 1,300 complaints with the FTC, 563 reported the information being mixed with that of their mother, father, sister, brother, son, daughter or grandparent. The next highest category is data mixed from a stranger, reporting at 213.
You can view the results at this link: TheColumbusDispatchMixedFileStatistics.