When you place a fraud alert on your credit report at one of the nationwide credit reporting companies, it must notify the others. A fraud alert requires creditors who check your credit report to take steps to verify your identity before opening a new account, issuing an additional card, or increasing the credit limit on an existing account based on a consumer’s request.
There are two main types of fraud alerts: initial fraud alerts and extended alerts.
Initial fraud alerts
You can place an initial fraud alert on your credit report if you believe you are (or are about to become), a victim of fraud or identity theft. Credit reporting companies will keep that alert on your file for 90 days. An initial fraud alert requires that the creditor take reasonable steps to make sure the person making a new credit request in your name is actually you. If you provide a telephone number, the lender must call you to verify whether you are the person making the credit request.
When you place an initial fraud alert in your file, you’re entitled to order one free copy of your credit report from each of the nationwide credit reporting companies. These free reports do not count as your free annual report from each agency.
Once you get your credit reports, review them carefully. Look for:
Accounts you did not open
Information about the status of the accounts and whether the account balances appear correct
Outstanding balances on your reports that you can’t explain
Incorrect personal information, such as your Social Security number, address, name or initials, and employers
Tip: If you find fraudulent or inaccurate information, contact the credit bureau to have it removed by filing a dispute.
You can place an extended alert on your credit report after your identity has been stolen.
When you place an extended fraud alert in your file, you’re entitled to order two free copies of your credit report from each nationwide credit reporting company over a 12 month period.
Tip: You must file either a police report or a report with a government agency such as the Federal Trade Commission, known as an “identity theft report.”
An extended alert is good for seven years. An extended alert requires that the creditor contact you in person or through the telephone number or other contact method you designate to verify whether you are the person making the credit request.
Special help for servicemembers
Members of the military (such as members of the Marines, Army, Navy, Air Force, and Coast Guard) have an additional option available to them – active duty alerts, which give servicemembers protection while they are on active duty. Active duty alerts last for 12 months.
When you place an active duty alert on your credit report, creditors must take reasonable steps to make sure the person making the request is actually you before opening an account, issuing an additional card, or increasing the credit limit on your existing account. Your name also will be removed for two years from the nationwide credit reporting companies’ pre-screening lists for credit offers and insurance.
You can also place a “freeze” on your credit report. A security freeze means that new creditors can’t access your credit report. Because most businesses will not open credit accounts without checking your credit report, a freeze can stop identity thieves from opening new accounts in your name. Be mindful that a freeze doesn’t prevent identity thieves from taking over existing accounts. Each state has its own rules about credit freezes and how much you pay for them.
Tip: Continue to check your credit reports periodically, especially for the first year after you discover the identity theft, to make sure no new fraudulent activity has occurred.