Placing a Fraud Alert

How to Place a Fraud Alert

Learn How to Put a Flag on Your Credit File

NOTE: If you live in California, you have to read about a new security freeze law, California SB 168, that just went into effect Jan. 1, 2003. California bill SB 168 tightens access to your credit data even more by allowing you to freeze all access to your credit file.

Putting a fraud alert on you credit file is one of the first things you should do if you suspect someone is trying to open credit accounts in your name. Whether you should do this even if you don't think identity theft is an immediate threat is another question. Many people think it is a good idea and others believe it leads to additional unwanted difficulties.

When you have suffered Identity Theft, you should know that a Fraud alert is not always the only curing action. Creditors can ignore a fraud alert, often unintentionally. If you suspect you are a victim of Identity Theft a fraud alert is only a start in trying to protect your credit. You also need to pay close attention to your credit report frequently to make sure no new credit inquiries or credit accounts are being opened.

What is a Fraud Alert?

A fraud alert is an attachment notice to your credit report placed there by the major credit bureaus. When one is in place and when you, or someone else, tries to open up a credit account by getting a new credit card, car loan, cell phone, etc., a lender or merchant should contact you by phone to verify that you really want to open a new account. If you are not reachable by phone, the credit account should not be opened.

What is important to remember is that a creditor is not required by federal law to contact you, however, even if you have fraud alert in place. Some states have different requirements that can govern these rights, so be sure to check your states laws.

How Do I Set Up a Fraud Alert?

Contact the fraud department of one of the credit bureaus and ask them to flag your credit file for fraud. You will likely talk to an automated voice response system and it should only take a few minutes.

What Happens When I Activate a Fraud Alert?

  • Within 24 hours, an alert will be placed on your credit file at all three major credit bureaus. They now share data so when you call one of the bureaus, your alert request is sent to the other bureaus automatically.
  • Your name will be removed from all pre-approved credit and insurance offers for two years.
  • You will be sent a credit report from each of the three major credit bureaus by mail. Expect 1 - 2 weeks for delivery.

What Are the Drawbacks of a Fraud Alert?

Activating a fraud alert will cause you a problem if you're used to walking into a furniture store, signing up for their amazing "don't pay anything until 2005" credit offer, and walking out of the store with a bedroom full of furniture. With a fraud alert active, you would have to be available at either your work phone or home phone to approve opening the credit account. Usually, the inconvenience is minor and your shipment of furniture may be delayed until you can call back to the credit company authorizing the new account.

On the plus side, a fraud alert will likely not cause many problems with using your credit card or checking accounts. The fraud alert focus concentrates on new credit accounts, not the ones you already have opened.

Placing a Fraud Alert
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