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Financial Education for Everyone

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October 19, 2007

In the 1970s-era spy thriller "The Day of the Jackal," a would-be assassin steals the identities of several dead people to further his plan to kill French President Charles DeGaulle. Unfortunately, this once-shocking plot device has become all too common in real life today.

Identity thieves use stolen personal information to borrow money, make fraudulent purchases or escape legal or immigration problems. They've discovered that it's often much harder for authorities to catch on when their target is "dead." By the time grieving relatives realize that their loved one's identity has been stolen, tremendous damage already may have been done – particularly when a widowed spouse's finances are intertwined.

Here are a few steps you can take to protect someone's identity when they pass away:

Be discreet in obituaries. You want to honor the dead and notify their friends, but be aware that unscrupulous people regularly troll obituaries, looking for clues. Be wary of including the person's exact birth date and location, most recent address and other personal information that can make it easier to steal their identity.

Contact Social Security. When someone dies, the funeral director notifies the state, which in turn informs the Social Security Administration (SSA). This may take weeks or months, so contact SSA yourself so it can more promptly flag the person's Social Security number as "inactive" and cancel benefits – or, if he or she was married or had surviving eligible dependents, convert the benefit to the proper status. For instructions, go to www.ssa.gov/ww&os1.htm.

Tell the DMV. Criminals sometimes obtain duplicate copies of dead people's drivers licenses with their own photos superimposed, so be sure to notify the Department of Motor Vehicles as soon as possible that someone has passed away.

Notify banks and creditors. Although SSA periodically notifies financial institutions of recent deaths, it's also a good idea for you to contact the person's banks, credit card issuers, mortgage lender, broker and the three credit reporting agencies – Equifax (www.equifax.com), Experian (www.experian.com) and TransUnion (www.transunion.com). Often these companies will require a copy of the official death certificate, so order ample additional copies – the funeral director can help.

You'll probably want to close most accounts immediately, to prevent fraudulent use, keeping in mind that outstanding debts will need to be settled. It's also a good idea for the surviving spouse to remove the deceased from any joint accounts or to close those accounts and reopen new ones in his or her name only. Consider consulting a financial advisor to help determine the appropriate steps you should take.

If you're having problems with identity theft, a good resource is Call for Action, an international nonprofit network of consumer hotlines affiliated with local television and radio broadcast partners (www.callforaction.org). Call for Action's website features comprehensive tips, and volunteer professionals on its hotline (866-ID-HOTLINE) offer free, confidential services to individuals and small businesses.

Another good resource is Practical Money Skills for Life, a free personal financial management site sponsored by Visa Inc., which contains detailed identity theft and security precautions everyone should take (www.practicalmoneyskills.com/security). Also visit the National Consumers League's site at http://www.nclnet.org.

It's hard to imagine someone stooping so low as to steal a dead person's identity, but unfortunately, there are such people in the world. Be prepared so you can protect the memory of your loved ones, and take precautions now to protect your own personal information to spare others that grief.

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This article is intended to provide general information and should not be considered health, legal, tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.

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