Setting Up a Fraud Alert on Your Credit Report
6 Min Read | Last updated: February 16, 2024
This article contains general information and is not intended to provide information that is specific to American Express products and services. Similar products and services offered by different companies will have different features and you should always read about product details before acquiring any financial product.
Is it helpful to set up a fraud alert on your credit report? Here’s why doing so could prevent or reduce instances of fraud in the future and protect your credit health.
At-A-Glance
- With identity theft and credit card fraud on the rise, setting up a fraud alert on your credit report is considered a good practice to help protect yourself from bad actors.
- Setting up a fraud alert on your credit report is fairly easy to do.
- A temporary fraud alert lasts for one year, unless you cancel it sooner, and requires creditors to confirm your identity before processing a credit card application.
Did you know?
As an added security measure to help protect against fraud, American ExpressⓇ reports a reference number to credit bureaus – instead of your actual account number.
Credit card fraud is one of the most common forms of identity theft: Federal Trade Commission (FTC) data shows it as the most common consumer complaint in 16 out of 20 quarters since the start of 2019.1 And as identity and credit card theft grow more prevalent, more people are taking steps to protect themselves from fraud. Setting up a fraud alert on your credit report is an important – and relatively easy – step you can take to make it harder for fraudsters to open credit card accounts in your name.
You can place a credit bureau fraud alert simply by requesting one from one of the three major credit reporting agencies – asking one credit bureau triggers the other two to place an alert on your report as well.2
What Is a Fraud Alert?
According to the Experian credit reporting agency, “A fraud alert is a free notification you can add to your credit report, instructing anyone receiving a credit application in your name to verify your identity before processing the application.”3 Alerts remain on your credit report for one year unless you request an early termination.2 And you can request another alert when the year expires.2
Having a fraud alert in place means businesses such as credit card issuers, potential employers, landlords, insurance companies, and rental car companies must contact you to confirm your identity before extending credit.
How Does a Fraud Alert Work?
A fraud alert requires lenders to take extra steps to confirm your identity before extending credit.2 When a fraud alert is set on your credit report, a lender who accesses your report will be notified of the alert. They will then attempt to confirm your identity by contacting you – at a phone number you provide, for example – before completing a request for credit.4 This can make it more difficult for a fraudster to open new accounts or modify existing accounts in your name. A standard fraud alert is free and lasts one year.2
Requesting a fraud alert is a good idea if someone other than you has used your personal data. Similarly, an alert is helpful if you have recently lost your wallet, had personal account or financial information stolen, or were informed of a data breach at a company that has your account information.
What Is an Extended Fraud Alert?
An extended fraud alert lasts for seven years.2 Only people who have experienced identity theft may request an extended fraud alert.2 In order to obtain one, you must have a police report or an FTC Identity Theft Report to support the request.2 Extended fraud alerts can also be renewed but require one of those documents each time to confirm eligibility.5
Military Service Members and Fraud Alerts
Active duty military service members have the option of requesting an active duty fraud alert if they will be deployed on assignment.2 This type of fraud alert lasts for one year and can be renewed as often as necessary while the service member is deployed.2 Military service members can have a personal representative with a power of attorney add an active duty alert on their behalf if they’re already deployed.6 They can update or remove an alert by phone or mail and receive help from the Consumer Finance Protection Bureau or the office of their state’s attorney general.6
Can a Fraud Alert Affect My Getting Credit?
Requesting a fraud alert does not affect your ability to borrow money, your credit score, or the details of your credit report.7 In some cases, it may delay an application, for example, if you’re applying for a new credit card.7 The reason? Those extra steps a fraud alert triggers may take more time to verify your identity for the application processing.7
The Takeaway
People who are concerned about their personal data and identity being compromised – and such concern is wise as identity theft and fraud are on the rise – may want to set up a fraud alert. It can be removed at any time or renewed when it expires.2,8 If you suspect or know your personal information was stolen or compromised, setting up a fraud alert is a proactive step you can take.
1 “Identity Theft Reports,” Federal Trade Commission
2 “What To Know About Credit Freezes and Fraud Alerts,” Federal Trade Commission
3 “What Is a Fraud Alert?,” Experian
4 “What do I do if I’ve been a victim of identity theft?,” Consumer Financial Protection Bureau
5 “What Is an Extended Fraud Alert?,” Experian
6 “7 Things to Know About Fraud Alerts,” Equifax
7 “Fraud Alert on Credit Report,” TransUnion
8 “How to Remove a Fraud Alert From Credit Report,” Experian
Tobi Elkin has reported on technology and marketing trends for more than 20 years as a writer, editor, consultant, and content marketer for media brands, startups, and corporations.
All Credit Intel content is written by freelance authors and commissioned and paid for by American Express.
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The material made available for you on this website, Credit Intel, is for informational purposes only and intended for U.S. residents and is not intended to provide legal, tax or financial advice. If you have questions, please consult your own professional legal, tax and financial advisors.
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