You find wrong information on your credit report. Is it a simple mistake or something more sinister? Here are some warning signs that you could be a victim of credit fraud:
Your personal information is wrong. “If you see a name you’ve never used, a Social Security number that doesn’t belong to you or an address at which you’ve never lived, it could be a sign of fraud,” says Rod Griffin, director of public relations for Experian.
A mistake here could be due to something as simple as a transposed number. It could mean your credit information has been mixed up with someone else’s. Or it could be a sign that someone is pretending to be you to get credit. How to tell the difference? Delve further into the details on your report to see if there is anything else suspicious.
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There are inquiries from lenders you don’t recognize. Credit reporting agencies are required by law to disclose the names of any companies that have obtained your credit information in the last two years. You don’t have to worry about “promotional” inquiries or “account review” inquiries, as those will be from companies marketing preapproved credit offers in the first case, or your current lenders reviewing your credit in the latter. But if there are inquiries from companies you truly don’t recognize, you’ll want to investigate.
One more thing to keep in mind here: Sometimes the name of the company checking your credit doesn’t match the name of the place where you applied for credit. Retail credit is a good example. You may apply for an instant credit account to buy furniture at “XYZ Furniture,” for example, but the financing is handled through “ABC Financial Services” — and that’s who is listed in the inquiries section of your report.
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You find accounts listed that you never opened. These may be the biggest tip-off that something is really wrong. Only your accounts, including accounts you have cosigned or those for which you are an authorized user, should appear on your credit reports. Accounts that aren’t yours could be a sign that your credit information is “commingled” with someone else’s, which is something you’ll need to sort out. Or it could reveal that your credit has been compromised.
Of course you can’t spot fraud on your credit reports if you don’t check them. At a minimum, get your credit reports once a year from each of the major credit reporting agencies: Equifax, Experian and TransUnion. You may be entitled to additional free copies of your reports if you live in certain states, are unemployed and looking for work — or if you believe you are a fraud victim. You can also use a tool like Credit.com’s free Credit Report Card to help alert you to changes in your credit report.
If you do find data on your credit files that appears to be wrong, don’t immediately assume the worst. “It’s important to take the information as a whole and in conjunction with other indicators,” says Griffin. “Things such as unauthorized charges on a billing statement, collection notices for accounts that are not yours, billing statements from an unknown lender or a call from an existing lender asking if you made a purchase that you did not make should also be taken into account.”
But do take suspicious activity on your credit reports seriously. Catching fraud early can save you time and money.
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Image: B Rosen, via Flickr
Gerri Detweiler Gerri Detweiler is Credit.com's Director of Consumer Education. She focuses on helping people understand their credit and debt, and writes about those issues, as well as financial legislation, budgeting, debt recovery and savings strategies. She is also the co-author of Debt Collection Answers: How to Use Debt Collection Laws to Protect Your Rights, and Reduce Stress: Real-Life Solutions for Solving Your Credit Crisis as well as host of TalkCreditRadio.com.
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I asked about this on another topic–but what do you think about credit monitoring and identity protection services through companies like Identity Guard? I have been using them since I had my identity stolen twice and find them to be good so far when it comes to keeping my identity safe and my credit history intact. I know that the 3 credit bureaus also suggest their own identity theft and credit monitoring companies, but I felt that these companies might be giving the credit agencies kick-backs for being their sponsors. Any way, what do you think about using these types of businesses along with checking your credit reports annually?
Short of putting a freeze on your credit file, you can’t prevent identity theft. But what you can do is spot it quickly and respond effectively if there is a breach. There are times when it makes sense to pay for a service to help you do that.