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Daughter Steals Mom's Money and Good Credit

 
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November 30, 2012
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QDear Erica,

My daughter and son-in-law opened up an account with American Express in my name. I had no idea until I happened to find a copy of a bill. They charged $1,700. I could not turn them in because they have two small children. They keep saying they are going to pay, but I keep finding out they haven’t. I had excellent credit. They also got themselves a phone in my husband’s name without us knowing it. What should I do? – Karen

AHi Karen,

Cut them out of your will? Disinvite them for the holidays? Those are just a couple of suggestions I can come up with instead of ratting them out to the proper authorities.

Unless your daughter and her choice of mate do not make amends in a few days, contacting your credit card company and the police immediately is the right thing to do. They committed a crime. How a child can do this to her own mother is beyond me, but sadly, it happens quite a lot.Ask Erica

I get that you want to protect your grandchildren, and that’s understandable. Therefore, here’s an alternative plan.

First, speak with your daughter privately. Find out what has really been going on between her and this guy. Who knows? There might be a substance abuse issue or a gambling problem that has prompted the identity theft. In that event, you’ll want to help her deal with it separately from the money and credit problems that she’s experiencing — and that she’s now passed on to you.

However, if your daughter and son-in-law opened the card using your personal and financial information because they simply “needed” the money, explain that you have no choice but to demand the funds back — or there will be major consequences. No more empty promises from them or toothless threats from you.

Write up a contract and present to both of them. This document should include:

  1. The amount they owe you. Make sure it includes any finance charges that have already been incurred, as well as projected charges if you can’t repay the entire balance quickly.
  2. Repayment terms. That will be the amount they need to pay on a monthly basis, and on the date of the month that you expect it.
  3. What will happen if they do not honor the contract. And if they do not pay as agreed? That will be up to you. You may hold onto their laptop or other property that is equal in value to the debt as collateral. If they fail to pay, you will keep the item. Or, stipulate that a missed payment will trigger trip to small claims court.

Sign and date the paperwork and have them do the same.

If they authorize and honor the agreement, wonderful. But if they don’t, take them to court. You deserve your credit and money back.

Another option is to forget all that and instead just harden your heart. Call the credit issuer and police right away. By reporting the fraud, you will not be responsible for the debt, and your credit and good name will be restored.

Whatever you choose, add a fraud alert to your credit file by contacting all three credit bureaus — TransUnion, Equifax and Experian. Fraud alerts require creditors to check with you whenever there’s a request for credit in your name, reducing the possibility that you’ll get hit up this way again. You probably won’t be able to close the account until the balance is at zero, so call your issuer and ask to suspend further use of the card. Monitor statements closely, checking for erroneous activity.

Contact the phone company, too, and shut down that phone line your daughter and son-in-law opened in your husband’s name.

Back to your daughter: Another possibility — and I hope it’s a remote one — is that she and the kids are in a deeper type of trouble. Maybe these weren’t her decisions, and she was coerced. I’m not there, so I don’t know. It’s up to you to find out and help her change such circumstances.

Then again, if she’s stolen from you complacently and with her eyes wide open, take no more nonsense. Force the repayment or pursue legal action.

Got a question for Erica? Send her an email.


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