Greetings,

Longtime 'lurker,' first time poster. I'll try to keep this short, but greatly appreciate any advice. My wife and I have been debt free for over 3 years now, meaning no credit card debt and only our mortgage.

When I ran our credit report the other day (which I do annually), I noticed 3 cards under my wife's name with balances of $2K, $3K and $12K. This shocked/worried me for obvious reasons. My wife said she did not open them, so she asked her mom and sister. They admitted to opening the balances under my wife's name! My wife was still receiving credit card offers at her mom's house, so they took advantage of the offers AND of my wife's excellent credit

They have been making payments and have never been late..........yet. We want them out of my wife's name asap, but therein lies the issue. They can't open any credit cards in order to transfer the balances into their names, PLUS my wife thinks if I report this as fraud/stolen ID, they will go to jail. She doesn't want this to happen due to our 4 year old niece.

I really want to get this resolved, but am at a loss re: how to handle it. They also really need financial advice/counseling, but that can wait, IMO.

I appreciate any thoughts, comments and/or advice from the distinguished members of this forum.

SouthernGent

My colleague had a similar situation where his mother opened up credit cards using his name and then filed for bankruptcy, which totally screwed him.

I understand it is your family, and you care about them, but they sure didn't care about your wife or you at the time they opened up three credit cards and then proceeded to charge $17k on them without informing your wife or getting her permission. Now your wife is completely liable for the $17k if she does not report it now that she knows. It isn't your mother and sister in-laws' debt, it is your and your wife's debt. moreover, the $17k in your wife's name is lowering your credit rating, because it probably boosts your debt to income and outstanding credit to available credit ratios. I would definitely report it to prevent your wife's liability. Punishment is used to prevent a behavior, and perhaps the threat of going to jail and losing a child is what your in-laws need to get their act together. Here's a good little resource on some of your options
http://www.idtheftmostwanted.org/artman2/publish/v_fact_sheets/Fact_Sheet_115_When_you_personallyknow_the_identity_thief.shtml

you'll have to scroll through all the Fact Sheets and Letter Forms, but it is a pretty comprehensive website in dealing with ID theft. They have just about every scenario you could imagine to include your own situation with relatives.

basically you have three options: report it as a real id theft; work with the creditors to resolve w/o police; pay as if it were your debt (which legally is if you don't report it as id theft). Speed is essential, though, because the longer you wait, the more you become a co-conspirator.

In the future, you might want to get a credit freeze put on your accounts in order to prevent them or anyone else from opening accounts. You can also have the creditors stop sending the offers by opting out and calling existing creditors to stop the mailings as well.

What an awful situation. I'd give them 3 days to get the debt out of your wife's name. Are you sure they can't get credit, or just that they can't get a decent credit card? It's not your problem if all they qualify for is 24% with horrible terms. If that means selling their cars and riding bikes to work, so be it. The first time you make a payment, it will appear that this is your debt or that you consented. Don't wait to put yourself in a predicament when they can't pay. They wouldn't have used your credit if they had oodles of their own money.

I'd also offer to take the niece in, in the event that her mom ends up in jail. More likely she'll have to pay the money back with community service and probation, since she's a first-time offender committing a nonviolent crime.

In my opinion, there's family and then there are people who are total losers that feel a sense of entitlement to crap on people who happen to be "family". Like everyone else, I've got lots of family sprinkled with a couple of losers who I wouldn't leave alone in my house unsupervised. These people victimized you, and I urge you to look at them as criminals rather than family. They didn't look out for you or treat you like family. I wouldn't even THINK my mom or sister were using me if I discovered I was an identity theft victim, so I'm wondering about the history of those relationships your wife has. Worst case scenario, maybe they never talk to you again. That's something you need to talk to your wife about and prepare her for. It seems it would be their loss anyway.

sorry to hear this. a colleague of mine just went through this with her ex-bf. she found that in order for most credit cards to dismiss the balance, you need to file a police report.

i would give them a chance to make good on the debt and close all accounts within 30 days, and let them know that on day 31 you are going to the police. it's fair, it offers them a chance to redeem themselves, and it's firm to get the idea across that you WILL protect yourself against this personal offense.

there is a certain level of familiarity that families have- and they walked right over that line into defrauding your wife. i'd say she has the right to make some demands in return. i can tell you this, if any of my siblings did that to me, i'd be on their doorstep tomorrow (i live 1200 miles away) demanding answers and my money back NOW or i'm taking equivalent property values as collateral. car keys first, hope your bikes are tuned up.

also, take your names off the prescreened credit offers list- optoutprescreen.com

Thank you all for your advice and comments. The website referred to by googoo was particularly helpful and I appreciate it greatly.

To be honest, I am much more upset by this than my wife. "They" are telling her they're working on it, blah, blah, blah, but I know better, especially with the sister-in-law (she's a real piece of work/crap). The SIL has threatened to not let anyone see the niece previously and my wife is afraid if she pushes her, she'll not allow us to see our niece. I'm going to get things moving this week and hope to get some kind of resolution.

As you said, Dani, I don't think either of them would go to jail, being a first-time offense. The community service and probation would probably be the wakeup call they need to get their act together. What a mess!!

Thanks again and I will update this post as things progress.

SG

This is a very hard one for me. My mother is kind of in the same situation when she cosigned on a loan that is close to defaulting. My stepbrother's girlfriend also went through the whole ID theft issue too.

I can't give good advice on this. All that I can say is that you must protect yourself first, then your wife/kids, then your family, then your assets. What happens when family steals assets? They commit a crime.

All this boils down to accountibility. If there's no consequences for their actions, what's to prevent them from continuing to do it?

The whole "call the cavalry" thing has been done already, and I quite agree with it, but I do believe that the *motivation* for that must be in simply protecting yourself, and not standing in the way of consequences.

SouthernGent, would you be willing to let me use this as an "Ask the Readers" on the blog sometime in early May? I think it's an interesting story and an important subject.

JDR,

Absolutely. I hate my first post was such a negative issue, but I hope to become a more active member and, hopefully, be able to offer advice to others.

The issue is quite difficult, because my wife is now saying she doesn't want to involve any kind of legal/police entities. Just this week, my MIL was laid off from her job and is going to struggle to make payments............which makes my point that WE will be liable for this debt in the end if the acct defaults! And it's just a matter of time before the SIL loses her job or quits making payments. They don't think we'll do anything to them. What a crock!

Again, I appreciate everyone's advice and input. I will certainly keep you posted via this thread. Any other advice is certainly appreciated, as well.

Thanks again,

Robert

Well I am 65 years old and you would think I would have saw or heard of it all but this is one that I had never thought of before, now I know this was done without your permission and it is important you act now and make it clear to them this is not acceptable . I have family that is always borrowing money from family and seem to not want to pay it back and it just makes your blood boil to have people who seem to think that they are entitled to what is yours and this is a form of such .

Amen! The "stickiness" comes from my wife not being as aggressive with them as she should be, IMO. We are going to make them sign a notarized letter stating she is legally responsible for the debt and also see if the credit folks will transfer the debt to her SSN (which I doubt they will w/o a police report, which my wife refuses to do).

This SIL is my wife's half-sister and she is always thinking everyone owes her stuff, even though she's the one that is the huge screw up in life! She could easily go back to school and finish her degree, but is too damn lazy to do anything productive with her life. She and our niece live with my MIL, so she has it made. I am so SICK of these selfish, victim-type leeches that just skim by in life and never offer anything of value to anyone!

The other kicker is that they HAVE NOTHING TO SHOW FOR ALL THIS DEBT!!!! NOTHING!!!! $17k in under a year...............with nothing to show for it!!!

I better go to bed before I get really worked up again

Thanks for all the support!

SG

Oh my god that's a tough one to be in. Basically as others have said you have to protect yourself and your family. If you let them off the hook they will continue to do this. I went through something like this years ago in my family (brothers drug problems etc) and basically with my Parents it came down to "you made the bed you lie in it". Now both my brothers are drug free (in today's environment they'd probably be locked up for the rest of their lives) and productive members of society, alot of it came down to tough love from my parents. And trust me it's not easy.

The only caveat I'd ad is what is the punishment. If it's way out of proportion to the crime than maybe reconsider it. A good example is underage sex, it's a misdemeanour that's been classified as a major felony. In their case their unlikely to be sent to jail for the it.

Like the others have said they have only their selfish interests at heart. If you don't report it they will continue to take advantage of it.

keep us informed of what happens

Edit: spent some time on the id theft website and he's how you could handle it. Tell them that you will contact the CC companies in order to arrange for the balances to be transferred to their names. CCs will say that you have to file a police report. This (hopefully) makes you look a little less like the bad guys.

Unfortunately regardless of what you do short of bailing them out, you will will come out looking like the bad guy. I suggest you keep reminding everyone that they commited the crime and they can be responsible for paying it back. Worse case senioro is if your wife is unwilling to file a police report is she co-signs a loan for them in her name, and if they defeat it comes out of her bank account, assuming separate accounts etc.

My Father in law was in a similar situation, handed over thousands of dollars to their youngest son and his wife to help him fund his latest get rich quick scheme. Unfortunately they didn't cut him off until they ran into financial problems and then suddenly he got a job. Unfortuanatly we tried saying something but they wouldn't listen. I fear it will be the same with your wife.

Wow, that really is a crappy situation that your wife's family has put you into.

First things first, and hopefully you've already done this, but cancel the cards immediately. Make sure they're not racking up more charges on those cards while they're singing their sob story.

Secondly, others have already said this, but make sure your wife understands that if she does not report this as fraud to the credit card companies now that she knows about it, she is consenting to being liable for the debt. She does not have the option of waiting to see if her family will start missing payments, and then calling the credit card company and trying to say it's not her debt. After this point, the debt is on her (and your) shoulders, regardless of whether or not her family chooses to keep making payments.

Third, I understand your wife's apprehension about protecting herself from this debt (at the expense of the leeches who ran it up in the first place), but make sure she knows it's not just her credit at stake here. As her husband, you are equally liable for this debt. This is not a decision she gets to make on her own. If she chooses not to report it, and her family bails, it affects you too. Make sure she knows that you are just as much a stakeholder in this as she is. If she ends up getting stuck on the hook for $17,000, you are on the hook too. It affects your budget, your credit, your household living standards. Her family has shown both of you enormous disrespect. They have taken you for granted.

Personally, if it were me in this situation, I would report them to the credit card company immediately and put a freeze on any further credit applications in either of our names. If the credit card company requests a police report, then I would simply come clean with them, tell them what's happened, and see if a solution can be worked out without involving the police. Your wife has done nothing wrong here, there's no reason for her to lie to the credit card company.

By protecting her family, she is putting both of you at risk. She needs to understand that. They are the ones who made this mess, and it's not fair of her to unilaterally decide that you two will bear the brunt of the consequences.

I think you have two problems, not just one. First and foremost, you have your marriage to worry about. Secondarily, you have your fiscal health. You cannot tackle the second before you tackle the first.

I sympathize with you deeply. I would be out of my mind if I were you. You are put in an aweful position and then told you have no control over it. I recommend you and your wife immediately go see a financial advisor (1 hour session to discuss subject, but purchase nothing) and / or a marriage counselor. This independent third party will better facilitate the discussion so that you can see each others point of view, without dictating a solution. When you two have a way forward, whether it is taking on the 17k, filing a police report, whatever, you will decide it together.

This is a very emotionally charged problem. I wish you a speedy fiscal recovery.

I'm going to assume that your family would be willing to transfer the debt to their name if the creditors will let them, and I would proceed as follows.

1) Contact the creditors, and explain the situation. Ask them if it's possible to get the balance transfered without pressing charges. You may still have to file a report with the police to create a valid paper trail for the creditor but you do not necessarily have to send the sister to jail.

2) Contact the impostors and let them know you're going to file a police report and why. Also make sure they're aware that this does NOT mean you're pressing charges, and that you're going to do everything in your power to get this cleaned up without anyone going to jail. Hopefully this will reduce the drama while at the same time protecting you from fraud charges yourself.

3) Begin to work with the creditors and impostors to get the balance transfered. You should have plenty of leverage with the impostors to work something out.

I have a lot of faith that this process will work assuming the impostors want it to work, otherwise press charges. Some people just refuse to learn the easy way.

It sounds like a very bad situation. I think your wife is letting the fact that its her mother and sister get in the way of the fact that they did not look out for her best interests. That is more shameful than you and your wife taking action to prevent further harm against your family.

As I see it, you have two options. Let your wife decide if 17K less income for her is worth it to keep the status quo with her family, or not. Or, alternatively, you can take the Southern Gentleman archetype and protect your wife by filing yourself.

I'd opt for the latter. Cancel those cards immediately, contact the credit card companies, and protect your assets from harm. You said that the mother lost her job and now won't be able to pay. That about seals your option. If they're that irresponsible with credit now, and they're let off the hook, I would be concerned of the precedent set

I'm really sorry you're in that situation. You have my sympathies.