So, you’re a victim of fraud.
What do you do?
Who do you even go to for help?
How are you going to get your money back?
Why do these questions seem so important to know, but so hard to answer?
Before you panic and do more damage to your wallet than the cyber-thieves have done already, let us explain why hiring an attorney isn’t the best initial response, how it can cause more harm than good, and provide you with some better alternatives.
(Most) Attorneys are NOT identity theft experts
Due to the lack of available options out there, they have become the logical, go-to answer for victims of identity theft, fraud, and other cyber-threats.
Although it’s safe to assume that some help would be better than no help, victims often panic and forget about the cost of things in these situations.
This is understandable, because nobody want’s to feel that their information or finances are vulnerable, but it can lead to people making rash decisions.
Not to mention, it’s kind of like hiring an electrician to fix a plumbing issue. Unless an attorney has experience or specializes in helping identity theft victims, they can make the situation a lot worse than it is already.
There have been far too many identity theft victims that have had to fix the damage done by both the criminals and by the attorneys they hired as well.
Here’s a few examples:
1. Bad Advice
A man discovered that someone had used his identity to commit credit fraud, and opened up few costly lines of credit for cars and even took out a home equity loan.
Not knowing what to do, or who else to call, the first thing he did was call his attorney for help.
The attorney told him that the best thing to do in this scenarios was to start from the ground up and file for bankruptcy. He then had to pay the attorney to proceed with the bankruptcy filing.
Unfortunately for the victim, his attorney had zero experience with identity theft cases prior to this event and by filing for bankruptcy, caused the victim to take all the financial liability with no hope of recover.
While there were several different laws in place to protect this victim (specifically the FCRA) from this kind of fraudulent debt, his rights were forfeited the second he took his attorney’s advice.
2. A missed opportunity
A couple received a letter from their bank stating that one of their savings accounts was overdrawn. They were shocked to find that someone had slowly moved money out of their retirement account within the past few months.
Had they monitored their statements on a regular basis, they could have caught the problem sooner, possibly avoiding this situation altogether. Nevertheless, they figured they had to hire an attorney to sort out the issue.
After many billable legal hours and dozens of phone calls with the bank, the attorney was able to recover some of the stolen money. However, this was only the minimum amount of money that banks are legally required to give to victims of fraud according to the Electronic Funds Transfer Act. Had the couple contacted the bank on their own and disputed this claim, they would of received the same amount of money.
So, they ended up getting stuck with the attorney’s bill on top of everything else that was stolen.
3. Malpractice, or just misinformed?
In this last example, a victim received an email receipt for fraudulent purchases made out of state. Fearing the worst, they decided to lawyer up.
After months of not being able to trace where the fraud came from, the attorney’s office started reaching out to other sources for help.
Finally, someone noticed that there wasn’t any actual evidence of fraudulent purchases. Nothing fraudulent showed up on the “victims” bank accounts, credit reports, or card statements.
As it turns out, the email the “victim” was so concerned about, was only a phishing email. She never clicked on any harmful links, or gave out any information, but the damage had already been done another way.
The client had paid thousands of dollars over the course of several months to try and fix a problem that never even existed in the first place.
(Note: this example happened back in (2012), where it could be argued that people were still unfamiliar with phishing emails. It just goes to show how important it was to hire the right person for the job.)
When to go to an attorney for identity theft help
Some cases of identity theft or fraud cases may require legal action. If the identity theft has led to legal disputes with creditors, financial institutions, or other parties, an attorney can represent you and help protect your rights.
However, not just any lawyer knows what it takes to help these victims. There are specific law offices that specialize in helping legal work involving cybersecurity cases. Just like doctors, most attorneys specialize in specific areas—and the growing number of fraud cases has created a demand that these lawyers are starting to fill.
Still, identity theft threats and techniques are constantly changing. So, if you are going to hire an attorney, do your research to make sure that they are more than capable of helping you recover the right way. The last thing you want is for them to make matters worse.
Recovering on your own may be easier than you think
Every second counts
When it comes to recovery. The main reason legal action is required in some identity theft scenarios is because incidents were reported too late for the financial institutions to transfer liability.
Under the Fair Credit Billing Act, you generally have a maximum of 30-60 days from the time the credit/bank statement was mailed to dispute any unauthorized charges. If you report the fraudulent charges within this time frame, your liability is limited to $50. If you wait longer than 30-60 days to report the fraud, your liability can increase to the full amount of the unauthorized charges—This is when legal assistance can come into play.
However, if it’s caught early, recovery can be as simple as a few phone calls. As soon as you discover the theft, you NEED to contact the related financial institutions or credit bureaus and alert them to the situation and start the process of disputing fraudulent charges and accounts. You should also consider filing an FTC Identity Theft Report and placing a credit freeze on your credit accounts.
Of course, every situation is different—If you believe you’re a victim and need help recovering, we offer plenty of resources to assist you and point you in the right direction.
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