Identity theft can affect your credit rating by causing ...

• A. Unauthorized charges on existing accounts only
• B. Authorized new credit lines approved with your consent
• C. Regular payment history unaffected
• D. Unauthorized accounts opened in your name

Answer: (D)

Identity theft harms your credit rating most when someone uses your information to open new credit accounts in your name. These fraudulent accounts appear on your credit report as new tradelines, and if the thief makes purchases or misses payments, those payment histories can be reported as late or delinquent. The presence of unfamiliar accounts and any associated late payments or high credit usage can drag down your credit score, sometimes significantly, until the accounts are resolved. That’s why the option describing unauthorized accounts opened in your name best fits how identity theft can impact credit. Charges on existing accounts can hurt those accounts and, if not resolved, may affect your score, but they don’t reflect new, fraudulent accounts opened under your name. Legitimate new credit with your consent isn’t identity theft, and regular payment history would not remain unaffected in a theft scenario.