CFPB Report Reveals Increase in Servicemember Identity Theft

CFPB logo with magnifying glassNearly 50,000 incidents of identity theft were reported by military consumers to the FTC in 2021, and military consumer complaints to the CFPB concerning identity theft-related debt increased nearly fivefold from 2014 to 2022.

01/18/2023 3:35 P.M.

3 minute read

Identity theft that results in damaging information on a credit report can cause problems for anybody, but for servicemembers it can result in the loss of a security clearance or even discharge, according to a new report from the Consumer Financial Protection Bureau.

In fact, according to the report, nearly 50,000 instances of identity theft were reported by military consumers—including active-duty servicemembers, veterans, and military family members—to the Federal Trade Commission in 2021.

Military consumers’ complaints to the CFPB concerning debts they said were the result of identity theft climbed nearly fivefold between 2014 and 2022, going from slightly over 200 each year in 2014 to more than 1,000 in 2022.

The CFPB detailed customers’ discomfort with filing complaints about erroneous information in a credit report. For example, consumers said that it was challenging to navigate a convoluted dispute process where they frequently had to fight false information repeatedly while handling other personal matters.

Customers who were trying to correct errors on their credit report brought on by identity theft described an especially challenging procedure. They frequently felt as though they were caught in a cycle of supplying documentation but receiving no changes to their report. Some consumers even mentioned paying a debt they didn’t owe to settle situations where an inaccurate debt collection item was listed on their report.

According to the bureau, servicemembers, veterans, and military families must be able to contact nationwide credit reporting agencies (CRAs) with their concerns about credit and identity theft.

The CFPB also urges financial institutions to think about enhancing their anti-identity theft defenses. When servicemembers report identity theft, the bureau will continue to use its resources to make sure that CRAs and financial institutions respond appropriately.

It added that servicemembers can protect their credit by:

  • Requesting an active-duty alert or security freeze before deploying for service.
  • Review their credit reports regularly and dispute inaccurate information.
  • Sign up for free credit monitoring services, which are available to active-duty military, reservists on active duty and members of the National Guard.

ACA’s Take

Identity theft triggers certain duties for debt collectors. Both the Fair Debt Collection Practices Act and the Fair Credit Reporting Act have requirements when consumers dispute a debt they owe. Debt collectors need to have policies and procedures in place to deal with claims of identity theft. A notice of identity theft from a consumer can be considered a dispute under the FDCPA.

Data furnishers also must have policies and procedures in place to stop the refurnishing of information that has been blocked due to identity theft.

The FTC launched a site,, in 2016 for consumers to file claims of fraudulent accounts on their credit report and send them to the CRAs. Additionally, this year’s Identity Theft Awareness Week, hosted by the FTC, is Jan. 30-Feb. 3.

With that in mind, Know My Debt, one of ACA’s most popular consumer education resources, features freshly updated content. ACA members can include the link to Know My Debt on your agency’s home page and give it to collectors to share with consumers.

By including links to vetted financial literacy resources on your website, you can help consumers find the critical information they need to feel comfortable talking to your company’s representatives. When creating a link on your website, ACA recommends calling it Know My Debt: Explaining Consumer Rights and Navigating Debt Solutions.

Visit the Know My Debt website to learn more about these valuable resources.

ACA members can find more information on the ACA SearchPoint website by searching for “identity theft.”

If you have executive leadership updates or other member news to share with ACA, contact our communications department at [email protected]. View our publications page for more information and our news submission guidelines here.

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