Using Credit Reports to Stop Identity Theft

Identity theft continues to be one of the fastest-growing crimes in the U.S., with over 1 million cases reported to the FTC in 2023 alone.¹ Thieves use various methods to steal personal data, from phishing scams and ATM skimming to mail theft and dumpster diving.

Fortunately, you can take proactive steps to monitor your identity and minimize the risk of fraud. Here are several key strategies.

1. Check Your Free Credit Reports

Under the Fair Credit Reporting Act (FCRA), you’re entitled to a free credit report from each of the three major credit bureaus (Equifax, Experian, and TransUnion) once per year.² Request them through the official site AnnualCreditReport.com. Since 2023, consumers can also access free weekly reports from the same site.²

To stay informed, consider rotating requests every four months to monitor your credit throughout the year.

Your credit report may include:

• New accounts
• Credit inquiries
• Late payments
• Changes in personal information

Watch for unfamiliar accounts or inaccuracies, as they may signal identity theft. If you spot errors, dispute them with both the credit bureau and the institution that reported the information.

2. Place a Credit Freeze or Lock

A credit freeze restricts access to your credit report, making it difficult for identity thieves to open new accounts in your name. You can freeze and unfreeze your reports for free at each of the three bureaus.³

A credit lock works similarly but can often be managed quickly through an app. Locks are usually offered as part of a paid service.

Keep in mind: If you’re applying for a loan or signing up for services, you’ll need to temporarily lift your freeze.

3. Set a Fraud Alert

A fraud alert encourages lenders to take extra steps to verify your identity before issuing credit. Alerts are free, last one year, and can be renewed.⁴ Placing an alert also entitles you to another round of free credit reports.

To activate a fraud alert, contact any one of the three major bureaus, and they will notify the other two.

4. Use Credit Monitoring Services

Credit monitoring provides continuous oversight of your credit activity and can notify you of new accounts, inquiries, or changes to your file. Some credit cards offer free basic monitoring, while full services can cost $10–$30 per month.

5. Practice Good Data Hygiene

• Shred sensitive documents like old bills and tax records
• Use strong, unique passwords and change them regularly
• Avoid sharing personal data over email or text
• Monitor financial accounts and statements for unauthorized transactions
• Use EMV chip-enabled cards and two-factor authentication when possible

Get Help from a Money Coach

A Money Coach who specializes in credit can help you:

• Understand your credit report
• Dispute errors
• Navigate fraud alerts and freezes
• Improve your overall credit and security posture

Call 888-724-2326 to speak with a Money Coach and strengthen your defenses against identity theft.

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¹ Federal Trade Commission. “Consumer Sentinel Network Data Book 2023.” February 2024. https://www.ftc.gov/reports/consumer-sentinel-network-data-book-2023

² Federal Trade Commission. “Free Credit Reports.” https://www.consumer.ftc.gov/articles/free-credit-reports

³ Federal Trade Commission. “Credit Freeze FAQs.” https://www.consumer.ftc.gov/articles/what-know-about-credit-freezes

⁴ Federal Trade Commission. “Place a Fraud Alert.” https://www.consumer.ftc.gov/articles/place-fraud-alert