When natural disasters become credit disasters

by Mackenzie McCarty11 Jan 2013

A consumer advocate for accurate credit reporting is warning Australians that their important papers must be disaster-ready to prevent both loss and theft of identity.

CEO of MyCRA Credit Rating Repair, Graham Doessel, says if clients need to leave their homes at any time during a disaster - whether it be a bushfire, storm, or flood, they need to ensure their important documents are ready to go with them.

“In a disaster, there is seldom time to fish around for important papers, so documents should be ready to go should victims need to leave their home in a hurry.”

This comes as the Government issued bushfire warnings last week and urged the public to be prepared should disaster strike – including securing important family documents.

Attorney-General and minister for emergency management, Nicola Roxon, says Australians need to prepare an emergency kit, including a torch, first aid kit, medication and a battery operated AM/FM receiver.

“Other items to include in a household emergency kit include copies of important family documents, contact details for your agreed out-of-town contact and spare clothes and strong shoes.”

Doessel says disasters in the recent past were further plagued by scammers and identity thieves hoping to make a quick buck from the misfortune of others.

“In the days and weeks following the Queensland floods in 2010, victims were tricked into giving over personal information and banking details, and were also robbed by crooks masquerading as tradespeople.”

Likewise, after the Canberra bushfires in 2003, there were reports of fraud.

"In the Canberra fires, many victims lost their homes, possessions, cars and key identification documents, meaning they had no way to prove their identity or use support services. Equally, impostors had an opportunity to present themselves as such victims, for instance by claiming to be someone whose name and address they had garnered from media reports.”

Doessel says if a disaster victim is unlucky enough to have their personal information stolen by identity thieves, they can have credit taken out in their name.

“They are hit twice – because they are also robbed of their ability to have a financial future. They are locked out of credit for up to 5 years or until any defaults that are incurred are removed. This is regardless of the source of the default. The process of repair can take months, as it involves the victim proving to creditors they didn’t initiate the credit in their name.”