By Adam Singer. Helping consumers with credit report errors to obtain corrections and compensation under the law. | Law Office of Adam G. Singer, PLCC
As stated in a previous article, identity theft happens every day. Identiyforce.com reported that 47% of Americans experienced financial identity theft in 2020; 9 out of 10 Americans encountered a fraud attempt in the past year; and Millennials (born between 1981 and 1996) accounted for 44% of U.S. identity fraud reports. According to idenityforce.com, there is a new identity theft every two seconds. This information is sobering, to say the least.
Let’s focus on layers of protection and what they do. We briefly spoke about these layers in a previous article. Now let’s discuss them in further detail.
Currently, there is no one form of protection that is guaranteed to prevent identity theft, but like homeowner’s insurance and automobile insurance, consumers often can take steps to reduce their risk. Most layers of protection can be added to a person’s credit file whether he or she is an identity theft victim or not. Consumers often can use one layer of protection or a combination of layers. The two layers I’ll talk about today are initial alerts and extended alerts.
With credit reports, one of the first protective layers is an initial alert on the credit file. This is a one-year alert and is a consumer statement placed on your credit file. It alerts potential creditors that you may be a victim of identity theft and have requested to be contacted by phone before the creditor extends credit.
The initial alert can be added any time by a consumer; you can add it online, by phone or in writing. There is no requirement to obtain a law enforcement report before adding an initial alert. Currently, only one phone number can be added to this type of alert. After one year, if you still need or want it, you can renew the alert the same way. It will expire otherwise.
Another layer of protection is an extended fraud alert. This is a seven-year alert and much like the initial alert, but you don’t have to contact the National Credit Reporting Agencies again for seven years to renew. Unlike the initial alert, though, there are some additional steps to add an extended alert. First, the request must be made in writing.
Second, in addition to the written alert request, you need a copy of an identity theft report. An identity theft report can be filed with a local law enforcement agency where you live (city, county, state) and/or federal law enforcement, such as the U.S. Postal Inspection Service, or you can file it with the Federal Trade Commission at IdentityTheft.gov. Two phone numbers can be added to the extended alert (such as home and work numbers).
It is key to remember that fraud alerts, whether initial or extended, are consumer statements placed on your credit file telling potential creditors to contact you by phone before extending credit. Since it is a consumer statement, the NCRAs will not be the ones to contact you. The consumer statement’s purpose is to inform potential creditors to contact you by phone to verify that you did in fact apply for credit. For this reason, it is vital that you use a working phone number on the alert. If an alert on your credit file doesn’t contain a phone number, most, if not all, potential creditors will likely decline the credit application.
Also, the NCRAs share fraud alerts in what is called a fraud exchange. For example, if you contacted Equifax to have an alert placed on your credit file, they will add the alert and then share that request through the fraud exchange with Experian and TransUnion. You should receive confirmation from all three NCRAs that an alert was added to your credit files, so be on the lookout for these once you request your alert.
Alerts are typically the first and most common layers used to protect your credit file with the NCRAs. More layers are available and will be covered in future articles.
Until then: Be safe!