Dear Liz: My sister, who is a 29-year-old single mother of three children, has committed identity theft by taking out loans and credit cards using my mother’s name. Her total debt is $30,000.
My parents are torn about what to do. I feel that she needs to be turned in so that they don’t have to pay this debt themselves, using their retirement money to do so.
They are concerned for the kids, but I feel that she needs to learn a lesson and that the family can take care of the kids. My sister suffers from bipolar disorder. I’m not sure what she would do if my parents turn her in.
Answer: If your mother lives in California or one of the other states that allows credit freezes, she should put one in place immediately â€” as should you and the rest of your family.
A credit freeze prevents anyone from opening credit accounts in your name, and is a much stronger protection than the fraud alerts that credit bureaus typically recommend.
A family member who has stolen one person’s identity could well steal the identities of others, because she probably knows the essential details â€” names, Social Security numbers, dates of birth and addresses â€” that would allow her to commit more of these crimes.
You seem to understand that to avoid responsibility for this debt, your mother almost certainly will need to file a police report, which means your sister could be prosecuted and sent to jail.
Occasionally lenders will let a victim off the hook without such a report if the thief admits the deed, commits to making payments and has the means to do so, said Linda Foley. She is co-founder of San Diego’s Identity Theft Resource Center, which helps victims of this kind of fraud.
The family typically needs to hire a lawyer to conduct such negotiations and draw up the necessary paperwork, Foley said.
It doesn’t sound like your sister’s a great candidate for this kind of deal, however, unless she’s gotten her act more together than your letter would indicate.
Your best move now, after recommending credit freezes for your family members, is to point your parents to the Identity Theft Resource Center, which has resources for victims of familial identity theft. Then back off. This is your parents’ decision to make.