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As long as personal credentials are stored and transmitted electronically, criminals will try to steal identities and open new credit accounts. Steps you take today, however, can help protect you from becoming a credit fraud victim.
Keys to avoiding credit fraud include being aware that it can occur, keeping alert for signs of fraudulent activity, and acting quickly if you suspect criminals are abusing your personal data. Experian offers free assistance and advice to help with all of these steps.
What to Do if You Believe You're a Victim of Fraud
If you believe you are a victim of fraud, there are steps you can take to protect your credit, and Experian is available with help and advice, including step-by-step instructions with steps to take for recovery.
Among the first steps to take if you believe your credit or finances have been compromised is to safeguard your credit so criminals can't apply for loans or credit cards in your name. You have the right to initiate a fraud alert or credit freeze. Here's how each works:
- Fraud alerts: A fraud alert asks lenders who view your credit report to verify your identity before processing a credit application or issuing credit in your name.
- Credit freezes: A credit freeze, or security freeze, restricts access to your credit file until you remove, or "thaw," the freeze.
What Is the Difference Between a Fraud Alert and a Security Freeze?
There are various differences between fraud alerts and security freezes, but the basic rundown of the two credit protection measures are as follows:
- Fraud alerts expire after a period of one year or seven years, depending on the type of alert, but may be renewed indefinitely. A fraud alert allows you to apply for credit in the usual way, but may delay the approval process somewhat until your identity can be confirmed by the lender. It is often more convenient for users who plan to seek new loans or credit in the near future.
- Credit freezes, while preventing unauthorized access to your credit information, also block legitimate credit checks. That means you must thaw your credit before applying for new loans or credit cards. This option may be more convenient for users such as retirees who foresee little need for new loans or credit accounts. A credit freeze remains in place indefinitely until you remove it.
How Fraud Can Happen
Credit fraud and identity theft can take many forms. The various types of fraud differ chiefly in what personal credentials are involved and the means by which that information is stolen.
Personal data routinely targeted by criminals includes:
- Social Security numbers
- Driver's licenses or other government-issued photo IDs
- Credit cards, debit cards and related account numbers
- Passwords to social media, e-commerce and banking accounts
The many ways criminals obtain personal data include (but are not limited to):
- Phishing scams: By means of email, phone calls, text or social media messaging, criminals present themselves as an authority you can trust and try to trick you into disclosing personal data. When in doubt, cease communication and reach out to the company or agency yourself. By responding to a suspicious message, clicking a link or opening a file, you might give an identity thief a way in.
- Data breaches: By hacking into commercial databases, criminals sometimes obtain troves of individuals' personal data in large batches, which they either use for their own purposes or sell to other criminals. If a vendor or financial institution alerts you that your data has been breached, consider a fraud alert or credit freeze. You can also sign up for a credit monitoring service that will alert you whenever there's new activity on your credit accounts.
- Physical theft: Stolen wallets and purses—and the credit cards and ID information they contain—can open up a world of opportunity for credit fraudsters. It's a good idea to keep an inventory of the items you carry routinely, and information on whom to contact if they're lost or stolen.
How to Keep Your Personal Information Safe Online
Safeguarding personal data online requires vigilance. It may require you to take steps that fly in the face of online shopping convenience, but that can help you avoid major hassles in the long run:
- Avoid storing your credit card information at e-commerce sites, to reduce vulnerability to data breaches and minimize the damage that can occur if someone steals your account password.
- Develop good online security habits, by creating strong passwords, using unique passwords for each account and changing them often. Where it's available, take advantage of two-factor authentication, which confirms your identity via voice call or text message as part of your account login.
- Be smart about online shopping in public by avoiding public Wi-Fi networks and taking care that others can't observe or overhear you as you enter account numbers or other personal information.
The best way to reduce your risk of credit fraud is to be vigilant and do your best to protect your personal information. Experian offers a wealth of advice to help in this effort, and also offers many resources in case you become an unfortunate victim.
Fraud Prevention Resources
- How to Freeze Your Credit
Request a credit freeze online or by mail from each of the three national credit bureaus to limit most access to your credit reports indefinitely.
- How to Place a Fraud Alert
It’s quick and easy to add a fraud alert to your credit report, notifying lenders to confirm your identity before processing applications for loans or credit.
- The Many Different Forms of Identity Theft
There are many different types of identity theft and fraud. Some lesser-known culprits could wreak havoc on your financial life if gone undetected.
- How to Protect Yourself From Identity Theft
Identity theft can wreak havoc on your finances and your life. Here are some steps you can take to limit your exposure to scammers and other cybercriminals.
- How Do You Protect Your Personal Information Online?
Protect your personal information online by using a password manager, double-checking what you share on social media and understanding signs of phishing.
- Steps to Take if You Are the Victim of Credit Card Fraud
If you’re a victim of credit card fraud, it’s important to act fast and notify your card issuer and a credit bureau to avoid lost money and damaged credit.
- How to Check for Identity Theft
You can’t fight back against fraud if you don’t know it’s happening. Understanding how to check for identity theft can help keep you protected.
- Should You File a Police Report After Identity Theft?
If you’re an identity theft victim, you’ll need to take several steps to clean up the mess. This could include filing a police report.