The Hidden Costs of Identity Theft

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It's been nearly three years since Brian Bateman's identity was stolen, and he still finds it painful to talk about.

“Just the thought of doing this interview had me stressed all weekend," says Bateman, a 38-year-old teacher in Morristown, New Jersey. “I don't mind talking about it, but it's just a reminder that every time I think I'm finished dealing with this, something else happens."

Bateman's identity was stolen in 2011 as part of a large East Coast identity theft ring that has landed at least seven people in jail. The ringleaders used stolen identity attributes to open credit cards in the victims' names, then changed the victims' address information to reroute their mail and hide the evidence. Although Bateman had no money stolen, the crime's effects have lingered. “I still get collections notices," he says. “I get 1099 forms for jobs I never held."

Bateman is proof that even when there are no lasting financial effects, identity theft is far from a victimless crime. The emotional toll can be significant: between the hassle of changing bank accounts and passwords to worries of repeat crimes and lack of trust, being a fraud victim can lead to both psychological and physical distress.

Red Tape and Stress

The most immediate source of stress for identity theft victims is the recovery process. One look at our identity recovery toolkit shows that clearing your name and protecting your assets is a slog: depending on the credentials stolen, the victim must notify banks, credit cards, medical insurers, the IRS, law enforcement, and more. And for some vulnerable groups, such as older adults, the process is even more arduous.

Ellyn Perrone can attest to the last point. In August 2013, her 88-year-old mother, who lives alone in Bryan, Texas, was mugged in a grocery store parking lot. Her mother's purse—containing her wallet, identification, checkbook, the key to her safety deposit box, and her Medicare card, which showed her Social Security number—was stolen.

Although she acted immediately to report the theft and try to replace her missing credentials, Perrone's mother ran into roadblocks at seemingly every turn: the Social Security office closed at 1 p.m. that day, a Friday; the department of motor vehicles wouldn't replace her license without an $11 fee, even though they knew that her cash and credit cards had been in the stolen purse. The calls to credit card companies and banks seemed endless, and with the weekend looming, she was worried that the thieves would use her information before she could act to protect herself.

“This has been a nightmare situation," says Perrone, the associate vice president for Research-Federal Relations at the University of Texas at Austin. “The bank, the DMV, the Social Security office—these are long waits for someone her age who's already stressed out." And although Perrone took a week off to help, she couldn't run these errands on her mother's behalf. “She had to be with me to answer security questions and so on. I do understand that's for security, but it's another stressor."

For Bateman, sorting out his identity theft has included nearly as much red tape. He first discovered the issue when mail stopped coming to his Morristown home. “I went to the post office, and they told me that I'd changed my address…except I hadn't," he says. Changing it back required trips to two different post offices, and that was just the beginning. As he realized the extent of the crime, he discovered that all his bank and utility accounts had to be closed as well. Then there were the credit card companies and collections firms who wanted to know why his bills weren't paid. “It's just long lines and red tape," he says. “I get so angry at [the banks, utilities, etc]—I know it's not their fault, but it's three years later and I'm still dealing with it. It's so overwhelming."

Loss of Trust

The long waits and the calls from collection agencies aren't the only things that upset Bateman about his experience. There's also a sense of having lost faith in the world around him. “It's taken a huge emotional toll, because I was such a trusting person beforehand," he says. “I left doors unlocked; I didn't put a password on my cell phone. I never thought this kind of thing could happen, so the shock I got when I found out was so upsetting."

"I never thought this kind of thing could happen, so the shock when I found out was so upsetting."
—Brian Bateman

Perrone, who is still helping her elderly mother monitor her identity (as of yet, her stolen credentials have not been used), agrees. “My brother and I are trying to minimize stress for her, but she's losing sleep, and her health issues are being magnified by the worry and fear," she says. “And part of that is the loss of trust. She's lived in Bryan for something like 67 years, and for a long time it was a much smaller town. So she's had to internalize that it's not the same place, and that there are people there who are out to do bad things. Her world has changed, and it's devastating and stressful."

Writing for Recovery

Dr. James Pennebaker has made a career out of studying the ways in which people manage stress. What he's discovered has powerful implications for anyone recovering from a traumatic event, including the theft of their identity.

“Major upheavals in anyone's life can be very stressful—they're associated with loss of sleep, change of appetite, and feelings of depression and isolation," says Pennebaker, a professor of psychology at the University of Texas at Austin. “This [can be] exacerbated because the event that's caused the stress is sometimes embarrassing, even humiliating, so that the person has trouble talking to others about it. We all do things like not pay enough attention to whom we give our personal information. So someone might feel like it's their own fault, or be afraid to patronize the same stores where their credit card information was leaked, and those emotions can build up."

Pennebaker's research over the last three decades has shown that putting negative experiences and emotions into words leads to positive physical and psychological benefits—for example, better grades and fewer trips to the doctor. “Being able to talk and share these experiences with others is healthy and normal," he says. But with experiences that are difficult to discuss, another strategy is to write about them.

“A major upheaval such as identity theft can be hard to discuss with others, because it covers so many parts of your life: finances, relationships with others, feelings of security and control," Pennebaker says. “Writing allows you to start putting all these things into perspective. Ask yourself: What happened? How has it affected me? Why am I reacting the way I am? Use it as an opportunity to analyze the situation and your response to it."

According to Pennebaker, this technique, known as expressive writing, works by helping people simplify their experiences and emotions. After writing about their experiences, his subjects tended to obsess less and sleep better—always a bonus for mental and physical health.

“Of course, writing's not a cure-all. There's a whole toolkit of things people can try," he says. “Meditation, exercise, or talking to a therapist or someone you deeply trust can all help."

For Brian Bateman, although he admitted that being interviewed for this article caused a good deal of stress, the relief he felt when it was finished proved Pennebaker's theory. Three days after we spoke, he sent a message saying our conversation had spurred him to finally contact the prosecutor's office for the details involving the identity theft ring and the part his credentials played in it.

“Thanks for this. It's good to get it all off my chest," he wrote, adding that it moved him towards “taking off the Band-Aid covering the wounds, and taking the final steps to put this to rest."

By Tricia C. Bailey
10.16.14

The Center for Identity's ongoing research is always providing new insights on the best ways to protect yourself from identity fraud and abuse. For more information about protecting yourself from identity theft, subscribe to our IDWise e-newsletter.

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