What Is a Credit Fraud Alert, and How Does It Work?
A credit fraud alert informs a credit reporting agency that a consumer’s identity has been stolen and that a request for new credit in that consumer’s name may not be genuine. A credit fraud alert can safeguard you and your credit from someone using your name to open bogus credit accounts. If your card is taken, you should notify one of the three major credit bureaus (Experian, TransUnion, and Equifax) so that a credit fraud alert can be issued.
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A fraud alert is a notification placed on your credit report that informs credit card issuers and others who may provide credit to you that you may have been the victim of fraud, such as identity theft. Consider it a “red flag” to potential creditors and lenders.
Important Points to Remember
A credit fraud notice is made to credit bureaus when a consumer’s identity is suspected of being stolen.
To complete a credit fraud alert, the owner of the stolen card must provide proof of identity to establish the request is legitimate.
During the credit fraud warning, any lender receiving credit requests is urged to take extra precautions to ensure that the request is genuine.
The three categories of credit fraud warnings are initial, extended, and active military.
Credit Fraud Alert: An Overview
An individual can send a credit fraud alert to the credit reporting bureaus at no cost to the person filing it. The person will be requested to present confirmation of identity in order for the credit reporting bureau to validate that the request is authentic.
Credit Fraud Alerts: What Are They and How Do They Work?
Initial, extended, and active military credit fraud warnings are the three categories.
Initial Warning
An initial alert lasts for 90 days and can be renewed for additional 90-day periods.
Extended Warning
A seven-year extended alert is valid. It requires you to file a police report with the credit bureaus, informing them that you have been a victim of identity theft and that you have reported the crime to the authorities.
Military Activation Alert
An active military alert is good for a year and can help you keep your credit safe while you’re away. Credit fraud alerts are typically filed by people who believe they have been victims of identity theft or whose personal information has been compromised as a result of a data breach.
Consider a credit freeze if you are confident your identity has been stolen for added security.
Here are seven facts concerning fraud alerts that you may not be aware of;
- Third parties are encouraged to take extra precautions to verify your identification before issuing credit if you have a fraud alert. So, what does this imply? Companies are expected to take reasonable steps to prove you are who you say you are, such as contacting you at a phone number you provide, before completing a credit request with an initial one-year fraud alert. An identity thief or fraudster may find it more difficult to register new accounts or modify current accounts in your name as a result of this. A fraud notice, on the other hand, would not prohibit an identity thief from attempting to use an existing account, such as a credit card.
- You have a seven-year fraud alert at your disposal. Extended fraud alerts are another name for these fraud warnings. A seven-year extended fraud alert is placed on your credit reports. A police report or a Federal Trade Commission Identity Theft Report is necessary to issue an extended fraud alert. You can request an extended fraud alert by mail by downloading this form.
- An active duty military alert is in effect for service personnel. An active duty alert is a feature provided only to U.S. military personnel. An active duty alert, like a one-year fraud notice, encourages businesses to take extra precautions to verify your identification, such as calling you, before creating new accounts in your name or changing current ones. This form of fraud notice lasts for a year as well. If a service member is already deployed, they can have a personal representative with a Power of Attorney add an active duty alert on their behalf.
- By phone or mail, you can change or delete a fraud alert. Any of the three nationwide credit bureaus can remove or update contact information on a fraud alert—one-year, seven-year, or active duty military alert—by phone or mail. If you want to update your information over the phone with Equifax, you’ll have to answer questions aimed to authenticate your identity. If your identification cannot be validated, we will give you more information about the documents you will need to mail to us so that we can confirm your identity. If you want to change your information by mail, you must submit a written request together with documentation that prove your identification. Find out which documents are acceptable.
- To have an initial one-year fraud alert, active duty alert, or extended fraud alert posted on all three of your credit reports, contact one of the nationwide credit bureaus. You can request an initial one-year fraud alert, active duty alert, or extended fraud alert on your credit report by contacting one of the three nationwide credit agencies — Equifax, Experian, or TransUnion — online, by phone, or by letter. The request must be forwarded to the other two credit agencies by the credit bureau you contact.
Your fraud alert might be managed by someone else on your behalf.
- A Power of Attorney or court-appointed document can be used to appoint a “personal representative” to manage a fraud alert on your behalf. Fraud alerts can be added, removed, or contact information updated by the personal representative.
- There are a plethora of more resources available that provide useful information about fraud warnings and related topics. You can learn more about fraud alerts on the Equifax, Federal Trade Commission (FTC), and Consumer Financial Protection Bureau (CFPB) websites, in addition to the three major credit bureaus. The website of your state’s Attorney General may also have educational material on fraud-related topics, such as varieties of fraud and what to do if you’ve been a victim of fraud.
