Protecting Your and Your Loved One’s Credit

June 27, 2014

Co-Author: Katie Shaw

Axley recently provided guidance on how to help protect your child from identity theft. Now that your child is protected, how do you protect yourself and other loved ones from unauthorized credit activity?

Wisconsin’s “security freeze” statute provides you with a helpful tool to monitor your credit activity and prevent identity theft. Under the security freeze statute, you can work with credit reporting agencies to put a freeze on your individual consumer credit report.

Creditors, such as credit card companies and loan issuers, review your consumer credit report when determining whether to issue credit to you and on what terms. With a freeze in place, credit reporting agencies cannot release your credit report to new potential creditors; only you can authorize the release of your credit report to creditors by providing the creditor with an individualized PIN or password. Without authorization, creditors are unable to review your credit file and, therefore, unable to extend credit in your name. Hence, a credit freeze allows you to monitor whether and when an extension of credit has been requested in your name to help prevent the repercussions of identity theft.

The process for requesting a security freeze from each consumer reporting agency is fairly easy.

  • Send a request by certified mail to an address designated by the consumer reporting agency, or send a request directly to the consumer reporting agency by any other means that the consumer reporting agency may provide (e.g. electronic form).
  • Provide the consumer reporting agency with proper identification.
  • Pay a $10 fee to each credit reporting agency. (Identity theft victims are exempted from the fee.)

To make requesting a freeze even easier, the Wisconsin Office of Privacy Protection has published a sample request form template to send to credit reporting agencies.

Upon proper request, the consumer reporting agency must put a freeze on your credit report within five days, and within ten days must send you confirmation of the freeze, your individual PIN or password to release your report to creditors, and any related procedures for authorizing the release of credit reports.

Now that you and your children are protected, how can you monitor the credit activity of your spouse, parents, or other loved ones from unauthorized activity?

Credit files are maintained on individuals only, so absent an agreement with your spouse, parent or other loved one that they will show you their credit report, you likely do not have authority to directly monitor their individual credit activity.

To the extent you’d like direct oversight over the individual credit activity of a spouse, parent, or other loved one, you and your loved one can agree to execute a limited financial Power of Attorney granting you authority to access your loved one’s individual credit file.

Once you have the limited financial Power of Attorney in place, you can work with credit reporting agencies to establish access to your loved one’s credit file. The credit reporting agency will likely require a copy of a notarized limited financial Power of Attorney, as well as personal identification, and a summary of your request. Once you have access to your loved one’s credit file, you can monitor for unauthorized activity.

Special thanks to Axley Summer Associate Katie Shaw for her assistance with this article.

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For more information about "Protecting Your and Your Loved One’s Credit," contact Donald J. Murn at dmurn@axley.com or 262.409.2277.