Consumer complaint received 2023-01-06
Company: NAVY FEDERAL CREDIT UNION
State: MA
Product: Credit card or prepaid card
Sub-product: General-purpose credit card or charge card
Issue: Getting a credit card
Sub-issue: Card opened as result of identity theft or fraud

Complaint:
XX/XX/XXXX - Fraudulent accounts opened in my name at Navy Federal Credit Union ( " NFCU '' ). Perpetrator used my real name, address, and social security number, but used a fake email address. Accounts were set up with paperless billing so I would not be aware. Credit card is mailed to an address different from mine, despite the accounts initially being set up with my real address, which shows a lack of due diligence and appears to be a violation of KYC standards. NFCU did not reveal the address the credit card was sent to until XX/XX/XXXX, see further information below. 
XX/XX/XXXX - I receive a letter from NFCU asking to confirm my SSN for the accounts opened in my name. I immediately call NFCU to report these accounts as fraudulent. The NFCU associate informs me that their fraud reporting system " is down '' and I have to send an email to them with the fraud report attached. I send the email as instructed. Despite refusing to confirm the validity of the use of my SSN, NFCU allows these accounts to remain open. 
XX/XX/XXXX - I run a XXXX report to identify any other fraudulent activity related to my SSN. I see a subprime lending company has requested a credit check. I also freeze my credit reports with all three bureaus and put fraud alerts on my reports. 
XX/XX/XXXX - I call the subprime lender to find out if they allowed a loan to be opened in my name. They confirm that they did not, as it was apparent to them that the request was fraudulent. Despite being a significantly smaller organization than NFCU, they were better equipped to identify fraud. 
XX/XX/XXXX- XXXX XXXX 's credit card fraud team calls as they have identified a fraudulent credit card application in my name. I call them back to confirm that they are correct about the fraud and to have the application terminated. I am disclosing these two incidents in addition to the NFCU fraud to highlight that two other organizations did identify these scenarios as fraudulent, while NFCU failed to do so. 
XXXX XXXX XX/XX/XXXX ( did not document exact date ) - Received a letter from NFCU thinking it would be the results of the fraud investigation. Rather, it was a letter attempting to collect the approximately {$12000.00} of debt that the perpetrators charged to the credit card. I called NFCU to ask why the fraud investigation had not occurred. They told me because " the system was down '' at the time I submitted the report, they had not gotten around to it. The NFCU associate also told me other information including the types of charges on the card, the largest being a XXXX  website. I have never purchased XXXX  of any kind. The NFCU associate also informed me that the perpetrator attempted to use the card in person at a XXXX XXXX store in XXXX, XXXX  on XX/XX/XXXX. I do not live in XXXX  and have evidence to support that I was at home on the east coast on this date. 
XX/XX/XXXX - The three credit bureaus had removed the fraudulent account from my credit reports, however, as NFCU still had not performed a fraud investigation and was still reporting the accounts as legitimate, the bureaus began to add the accounts back to my reports. I called NFCU again on this date and was informed that they had never processed my fraud report, still citing that it was due to the system being down. The NFCU associate I spoke to re-filed the fraud report and said she would ask to have it expediated. 
XX/XX/XXXX - I receive a " Notice of Important Rights '' from NFCU stating I may dispute the validity of the debt in my name. I call NFCU again and am transferred to the security team who refuse to answer any of my questions and repeatedly tell me that investigations are handled in the order they are received and despite the initial investigation being botched, they will not prioritize my case. The associate on the security team was rude and displayed a nasty attitude. 
XX/XX/XXXX - after accumulating the information and exhibits I need, I write and mail a letter to NFCU to dispute the debt. 
XX/XX/XXXX - I receive a letter from NFCU stating that the debt is still valid and that their evidence is the account statements from the previous three months. An account statement for an account that is fraudulent should not be considered evidence that the debt is valid. It appears that this is a tactic used by NFCU to avoid investigating or acknowledging fraud. NFCU also enclosed a copy of the letter sent when the credit card was mailed out. The letter was addressed to a home in XXXX, XXXX. As stated above, I do not live in XXXX. I have never lived in XXXX. I do not have relatives in XXXX. I have never authorized anyone in XXXX, or anywhere else, to use a credit card in my name. I searched for the address online and the names affiliated with the address are people I have never heard of. 
XX/XX/XXXX - In reviewing the hard copy account statements sent to me by NFCU, I notice a minimum payment has been made on the credit card. I did not make this payment and my assumption is that the perpetrator made this payment to be able to use the credit card again. I call NFCU to understand what has happened. The NFCU associate informs me that a payment was made from the fraudulent checking account that was also opened in my name. She agrees that it is likely the perpetrator made the payment to be able to use the card. She also notes that the fraud investigation was closed, with no notes to indicate why. NFCU 's policy is to communicate results of fraud investigations by mail. As they did not do so, the associate put in a request to have the denial of investigation mailed to me and also requested the investigation to be reopened. She then transferred me to the credit card fraud team to gain further information. The associate on the fraud team informs me that she can not give me any information. I simply wanted to understand if the perpetrator was able to use the credit card now that they had made a minimum payment. After informing her that I intended to go to the police with the information I have, she finally tells me that the card is restricted and can not be used. Still planning to go to the police and file a report, I ask for where to send the police report. She tries to avoid giving me contact information and states that information can only be sent to the fraud investigators if they ask for it. I keep pushing and eventually she gives me the email address for the security appeals team. 
XX/XX/XXXX - I go to my local police station to file a police report, including the address in XXXX  that the credit card was sent to so the two police departments can communicate. I also call the police in XXXX, XXXX, but they refuse to take information from me and state that it needs to go through local police. Local police tell me a detective will be assigned and will reach out to me, but can not give me a timeline XX/XX/XXXX - I reach out to a financial private investigator who suggests filing with the CFPB, as the actions of the bank are a violation of KYC standards and could warrant regulatory investigation. 

As the instructions state not to include any personal information, I have not attached any documentation related to this complaint. Upon request, I will gladly provide any documentation including my correspondence with NFCU, the ID theft report I filed with the FTC, the ID theft affidavit provided to the police, the address the fraudulent card was sent to, etc. I have saved all documentation related to this fraud. Except for the police report, which I just requested yesterday, NFCU already has all of the same information, but refuses to do anything with it.

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with non-monetary relief