Thursday, May 15, 2014

Putting a fraud alert to the test

After someone tried to hijack my credit card, I filed an initial fraud alert for extra protection. Then I tested it by applying for a new card from a different issuer.

To back up a minute -- a fraud alert is a kind of red flag used by the big three credit bureaus. After you file one, lenders are supposed to make extra sure they're dealing with you, not an impostor. They can still pull your credit report and process a loan application, but the alert on your credit report should give them pause.

You file the alert with one of the majors, and they share it with the other two, when you have reason to believe you are at risk.

I had reason. My all-purpose card had nearly been taken over. Someone, using the card number and my identifying details, had tried to change the mailing address. They were probably about to ask for a new card to be mailed out, but an alert from the card issuer reached me in time to stop the hijacking.

The episode provided a chance to test the anti-fraud system by applying for a new card. Now the results are in: For me, in the very limited sample of just one card application, the alert seemed to work.