If you've been the victim of identity theft, or suspect there has been fraudulent activity on one or more of your credit accounts, you can place a fraud alert on your credit report with one of the three major credit bureaus: Equifax, TransUnion, or Experian. The company you contact must give notice of the fraud alert to the other two.
Although it's not foolproof, the alert lets creditors know they should confirm the account holder's identity before approving any action on the account. This is meant to prove that the person who is paying for something or opening a card in your name, is actually you and not the person who stole your vital information.
The fraud alert also entitles you to a free credit report, which should be scrutinized for fraudulent activity. If you find fraudulent activity, you must have it removed, or you will be made to pay for the debts you did not create.
According to the Federal Trade Commission (FTC), there are two types of fraud alerts that can be placed on your credit report:
- Initial alert
- Extended alert
Initial Alert vs. Extended Alert
An initial 90-day fraud alert is a preventative measure when you suspect you have been the victim of identity theft or believe you will be a victim of identity theft. The most common circumstances one sets an initial alert are usually:
- A lost or stolen wallet
- Phishing scam
With this type of alert, potential creditors cannot issue new accounts without first confirming the person's identity. Unfortunately, creditors do not always catch identity fraud. This type of alert also gives you one free credit report so that you can monitor your accounts.
An extended alert is placed on a credit report if you have been the victim of identity theft and have provided the consumer reporting company/credit bureaus with an Identity Theft Report through local law enforcement. With this type of fraud alert, creditors must contact you or even meet with you in person before issuing credit. The extended alert provides two free credit reports from each of the three major credit bureaus within a one year period.
Fraud alerts do not stop the fraudulent use of existing accounts; they only stop the opening of new accounts. As such, they are a prevention or warning system, but cannot actually fix damage already done by an identity thief. If you have confirmed fraudulent activity through fraud alerts, you must follow-up by removing the fraudulent accounts and activity from your credit report. Even though the debt may have been incurred by an identity thief, creditors, credit bureaus, debt collectors, and other third parties may still attempt to obtain your money for a debt you don't owe.
If you've been the victim of identity theft and wish to learn more about your options, call identity theft attorney Howard D. Silver at 855-341-2611 to schedule your free consultation. We proudly help those who live in Los Angeles, Riverside, Ventura And San Bernardino Counties, and other areas in California.