Bulletins

Simple Anti-Fraud Measure: Free Credit Reports

by Susan M. Wolcott, CPA, CFE (Certified Fraud Examiner)

To Our Clients and Friends

With identity theft and fraud seemingly running rampant, it is imperative that consumers and business owners are vigilant in protecting themselves. One easy, but important tool in catching identity theft is the Free Credit Report. In this article, I will describe how to get your free reports, how it helps you, and some pitfalls to avoid.

The Fair Credit Reporting Act (FRA) requires each of the nationwide consumer reporting companies � Equifax, Experian, and TransUnion � to provide consumers with a free copy of their credit report upon request, once every 12 months. The Federal Trade Commission (FTC) enforces the FCRA with respect to consumer reporting.

The three nationwide consumer reporting agencies have set up a central website, a toll-free telephone number, and a mailing address through which you can order your free annual report. Do not contact the three nationwide consumer reporting companies individually.

How to order your free report:

� On the internet go to www.annualcreditreport.com.

� Call 1-877-322-8228

� Complete the Annual Credit Report Request Form and mail it to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. The form can be printed from www.ftc.gov/credit.

There is only the one website that is authorized to fill orders for the free annual credit report you are entitle to under law. Other websites that offer free credit reports may have strings attached or sign the applicant up for a supposedly �free� service that converts to one with a fee after a trial period. Some of the other sites direct a consumer to others sites that try to sell something or collect personal information. So the recommendation is to use only annualcreditreport.com and be wary of other sites.

There are credit monitoring services that will provide the credit reports for a monthly fee. Usually these services send a report quarterly. For some people that is the preferred choice. When using the annual credit report option available by law the consumer can order the reports from each of the three nationwide consumer reporting companies at the same time or order the reports one at a time. By ordering one at a time every four months it is possible to monitor throughout the year rather than once a year.

The following information will be required to obtain a free credit report:

� Name

� Address (if moved in past two years may require prior address)

� Social Security number

� Date of Birth

� To maintain the security of the individual�s file, each nationwide consumer reporting company may ask for some information that only the individual would know, such as the amount of a monthly mortgage payment. Each company may ask for different information because the information each has may come from different sources.

An individual�s credit report has information that affects whether one can obtain and how much one will pay to borrow money. It is a good idea to make sure the information being reported is accurate, complete, and up-to-date before applying for a loan for a major purchase like a house or car, buying insurance, or applying for a job. Inaccurate information may be a mistake or may be the result of identity theft. When someone uses your personal information to open a new credit card account in your name and doesn�t pay the bills, the delinquent account is reported on your credit report.

If requested online at annualcreditreport.com the credit report should be able to be accessed immediately. The other methods the report is processed and mailed within 15 days from the phone call or the request having been received by the Annual Credit Report Request Service.

Some things to remember about your credit score:

� All scores aren�t the same.

� Your credit score is constantly updated.

� Credit bureaus have no way of knowing whether the activity on your report is legitimate or not.

� Your credit score is a big factor in whether you get a loan with good terms.

� You can change your credit score (can be done quickly by making sure all payments are being made on time, lowering monthly balances, and getting rid of unneeded credit cards).

For additional information go to www.ftc.gov or give us a call at: 541-773-6633.

Very truly yours,

Susan M. Wolcott, CPA, CFE