Purpose

• Fraud alerts protect identity theft victims by letting creditors know that thieves are trying to open unauthorized accounts. The alerts are added to Experian, TransUnion and Equifax credit reports. Lenders who request the records when someone applies for a new account know they should take stringent verification steps when they see the alerts. Privacy Rights Clearinghouse, a consumer rights website, explains that lenders call and ask personal questions before extending credit.
  
  

Process

• Consumers have the right to place fraud alerts on their credit reports for free. All three credit bureaus have detailed information on their websites explaining how to add alerts online or over the telephone. Victims only have to work with one bureau because the law requires it to ask the others to place alerts on their records, too. The Federal Trade Commission explains that each bureau gives a free credit report copy when it places an alert so the affected consumer can review it for unknown accounts and other fraudulent activity.
  
  

Length

• Fraud alerts initially last for 90 days. They are automatically erased after that time unless the consumer specifically asks for an extension. Extended alerts remain on record for seven years unless they are removed at the consumer's request. The FTC states that the credit bureaus require police report copies proving victim status before they add extensions. Local police departments are sometimes reluctant to take identity theft reports. The FTC recommends providing as much proof as possible to the officers and explaining that the report is required by Experian, Equifax and TransUnion. Talk to the county or state law enforcement officers if the local police department still refuses to fill out paperwork.
  
  

Alternative

• Credit freezes are sometimes used as alternatives to fraud alerts. Clark Howard, a consumer advocate, explains that freezes lock credit records and prevent lenders from viewing them unless consumers temporarily allow it with a password. Criminals are unable to open fraudulent accounts because their applications never get processed, since the necessary records are inaccessible. Freezes cost about $10 per credit bureau, although laws in certain states provide this service free to fraud victims. "Thawing" credit for legitimate applications also incurs a small cost.