Protecting Your Credit With a Fraud Alert

This is article 6 of a series of articles to help victims of identity theft. The previous 5 articles outlined the important first steps to take, rules to remember, documents to create and file, and ways to either dispute or block information on your credit report. This article explains the two types of fraud alerts, initial and extended, which are available to you if you believe you are a victim of identity theft and want to protect your account from future theft.

A fraud alert is designed to protect against identity theft. If you suspect you have been or might be a victim of identity theft you can instruct the credit reporting agencies (CRAs) to place a fraud alert on your account.

Important facts about fraud alerts:

  1. They are free.
  2. There are two types, “initial” and “extended”
  3. It is your federal right to place an alert on your credit report.
  4. A fraud alert should not affect your credit score.
  5. Once an alert is in place, keep your contact information for the alert current to make the creditor confirmation process quicker and more efficient when you do want to obtain credit or open a new account.

Initial Fraud Alert

An initial fraud alert can be placed on your credit report for 90 days and can be renewed for an additional 90 days if you believe your identity is still at risk. In order to obtain an initial fraud alert, you must contact one of the three Credit Reporting Agencies (CRAs) if a suspected theft has occurred. The CRA is then required to contact the other two agencies about the alert. This initial alert is an extra safeguard which signals to future creditors that it is necessary to take reasonable steps to ascertain your identity before any future credit is given or accounts are opened under your name. You are also entitled to one free credit report from each of the three CRAs during the 90 days of the alert. This can help you monitor your account activity to ensure that no further damage has occurred.

Extended Fraud Alert

An extended fraud alert differs from the initial alert in the steps taken to secure the alert, the length of time the alert is on your credit report, and the rights granted to you with the enactment of the extended alert.

  1. First, you must give a CRA an ID Theft Report, (see article 3 of this series for discussion about ID Theft Report).
  2. In this case the ID Theft Report could be what you filed with law enforcement, a copy of the ID Theft Affidavit (also discussed in article 3). Any of these options will be enough for the CRA to then place an extended fraud alert on your credit report.
  3. An extended alert will last for 7 years.
  4. Once the alert is in place, you are also entitled with this alert to two free credit reports for the first year from all three of the CRAs.
  5. The CRAs are required to block your name from any pre-screened credit marketers for the next five years unless you desire otherwise.
  6. If there is any future application for credit under your identity while the alert is on your credit report, the creditor must contact you by phone or other method you select to authenticate your identity.

It is important to remember that fraud alerts do not prevent creditors from gaining access to your credit report; alerts only make it necessary for more extensive measures to be taken to verify your identity.

You will find more detailed information about resolving your identity theft situation at the FTC website, www.ftc.gov. A knowledgeable consumer law attorney can also guide you through the process, help you assert your rights and restore your financial reputation. Contact one of our consumer protection law attorneys for help at 610-323-7464.