Fraud Alert

A fraud alert is a notification placed on your credit report that signals to potential creditors to take extra steps to verify your identity before extending credit. This is crucial in the fight against identity theft, where criminals use your personal information to open accounts in your name. For example, if you place a fraud alert, and a lender attempts to check your credit for a new credit card application, they will be prompted to take additional steps, such as calling you to confirm your identity. This simple precaution can significantly reduce the chances of being defrauded.

Statistics show that identity theft affects millions of Americans each year, with the Federal Trade Commission reporting over 1.4 million cases in 2020 alone. Placing a fraud alert is free and can last for up to one year, but you can renew it. Many people mistakenly believe that fraud alerts automatically prevent identity theft, but they do not block access to your credit; they merely signal lenders to be cautious. It’s also important to note that there are two types of alerts: a 90-day fraud alert and an extended fraud alert, which is available to identity theft victims and lasts up to seven years.

To set up a fraud alert, you only need to contact one of the three major credit bureaus—Equifax, Experian, or TransUnion. They will notify the others, ensuring your alert is placed on all reports. This action not only helps protect your financial identity but also gives you peace of mind. For anyone worried about potential fraud, this is a simple yet effective step to safeguard personal finances. As a key takeaway, regularly monitoring your credit and placing a fraud alert can be the first line of defense in preventing identity theft.