Credit Bureaus Help Fight Identity Theft

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Holiday shopping no longer requires a trip to the mall or a strip shopping center. For many of us it means huddling in front of a laptop zipping from website to website, purchasing presents in the comfort of our bathrobes and fuzzy slippers. While shopping online is certainly more convenient than jostling for premium parking spots at the mall, there is always the underlying potential for identity theft.

Therefore, if you believe you are a victim of identity theft after the holiday shopping season, you should contact one of the three major credit bureaus to place a “fraud alert” on your credit account. This critically important step makes it more difficult for identity thieves to open credit card accounts or redirect tax refunds into bank accounts they may attempt to create in your name.

The three main credit bureaus are as follows:

If you are an identity theft victim, you need contact only one of the three to request a fraud alert. One bureau must notify the others when a fraud alert is requested. You will receive a letter from each credit bureau confirming that they placed a fraud alert on your file. There are three types of fraud alerts to consider.  Each provides a heightened awareness to businesses that thieves may try to open false accounts under your name.  The three types include:

  • Initial Fraud Alert  If you are concerned about identity theft, but have not yet become a victim, this fraud alert will protect your credit from unverified access for at least 90 days, which you can always renew. You may want to place a fraud alert on your file if your wallet, Social Security card, or other personal, financial or account information is lost or stolen.
  • Extended Fraud Alert  For victims of identity theft, an extended fraud alert will protect your credit for seven years.
  • Active Duty Military Alert  For those in the military who want to protect their credit while deployed, this fraud alert lasts for one year.

In addition, you should get your free credit report immediately to ensure identity thieves have not opened additional accounts. Go to https://www.annualcreditreport.com, which is operated by the three major bureaus, or call 877-322-8228.

If you were part of a large-scale data breach, you might consider a “credit freeze” which applies even stronger protections but often times for a fee that varies by state.   A credit freeze, also known as a security freeze, lets you restrict access to your credit report, which in turn makes it difficult for identity thieves to open new accounts in your name. You must contact each of the three credit bureaus to establish a credit freeze.

What is the difference between a credit freeze and a fraud alert? A credit freeze locks down your credit. A fraud alert allows creditors to get a copy of your credit report as long as they take steps to verify your identity. After receiving your freeze request, each credit reporting company will send you a confirmation letter containing a unique PIN (personal identification number) or password. Keep the PIN or password in a safe place, because you will need it in order to lift the freeze should you apply for credit, a home mortgage or when applying for a new job in the future.  Removing the fee allows businesses to confirm your credit record. There is a fee for removing the freeze.

To learn what additional steps you can take to protect your personal and financial data, contact one of our professionals today.