How to protect yourself from Credit Fraud

Credit Fraud has become a huge problem in the last decade. With the emergence of the Internet and the ability to buy products and services online, stealing someone's identity and racking up huge bills on a credit card has become widespread. Credit Fraud can cause a headache for many consumers who may be the victims of identity theft. Credit Fraud also costs lenders millions and millions of dollars every year.

What's a fraud alert?

However, there are ways consumers can protect themselves from Credit Fraud. Consumers may ask the major credit card companies, who monitor consumer financial data, to place fraud alerts in their credit files to let creditors and others know that they may be a victim of identity thefts.  Fraud alerts make it more difficult for scam artists to commit Credit Fraud. A creditor must follow a certain procedure with consumers who have fraud alerts on file. There are downsides to protecting yourself from Credit Fraud using fraud alerts. A fraud alert can delay a consumer's ability to obtain credit, such as taking advantage of department store credit card offers while at the checkout counter.

How to sign up for a fraud alert

For a consumer to sign up for a fraud alert, they have to contact just one of the three major credit reporting agencies (Equifax, Experian, or TransUnion).  When the agency processes the consumer's request for a fraud alert, they will notify the other two credit reporting agencies so they can place a fraud alert in their files also.

The two types of fraud alerts

There are two types of fraud alerts consumers can choose from to protect themselves from Credit Fraud – an initial fraud alert and an extended alert. An initial fraud alert lasts for a period of 90 days. An extended alert remains in the consumer's file for seven years. In order to place either alert, the major credit reporting agencies will ask the consumer for proof of identity, such as social security number. For an extended alert, consumers will have to provide the credit reporting agency with an identity theft report. An identity theft report includes a copy of a report that was filed with a federal, state, or local law enforcement agency.

For more information on Credit Fraud and debt, contact NCO Financial Systems, Inc. today, or explore their consumer help website at www.consumerhelpunit.org.

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