Imagine this troubling scenario: You’re looking at your credit report, and you spot a hard search that you don’t recognise.
What if these hard searches are appearing on your report — and you don’t believe you authorised them? This may indicate a number of things, including fraud.
Here are five things you can do if you suspect unauthorised credit searches on your report.
1. Contact the company that made the search
You can ask the company to prove that you authorised a credit search and request that it notify the major credit reference agencies — TransUnion, Equifax and Experian — to remove the search from your credit report if it was a reporting error.
2. Report and document the fraud
If you suspect identity theft because of hard searches you don’t recognise, you can report an identity theft complaint to your bank in the first place.
If your details have been used without your authorisation, you may also want to file a police report, which you may need to provide if you decide to claim for return of the funds as an unauthorised transaction.Action Fraud is the UK’s national reporting centre for fraud and cyber crime. You can contact Action Fraud to seek advice or to report fraud if you may have been scammed, defrauded or experienced cyber crime in England, Wales and Northern Ireland. They can be contacted by phone 0300 123 2040 or on their website.
3. Notify the credit reference agencies
You can place a credit freeze — which restricts access to your credit reports — on your account by contacting each of the three major credit reference agencies: Experian, TransUnion and Equifax.
The credit reference agency you place the freeze with won’t contact the others, so you’ll need to contact all three yourself.
4. Place a protective fraud marker on your credit report
You may wish to contact Cifas (the UK’s Fraud Prevention Service) and request a Protective Registration to be applied to your personal details in the National Fraud Database. This indicates to lenders and other organisations that they should carry out additional checks on any applications using your details.
You can read more about Protective Registration and apply online. This will cost £25 and the Protective Registration lasts for two years.
5. Dispute the unauthorised search with the credit reference agencies
If you’ve spotted an unauthorised hard search on your Credit Karma account, all you need to do is log into your Credit Karma account, access your credit report and use the button marked ‘Raise a dispute with TransUnion’. This will take you to the TransUnion website and explain in detail how you can dispute the information on your report.
Once you’ve resolved this with TransUnion, any changes would be reflected on your credit file when it’s next updated.
You may also wish to contact the two other major credit reference agencies, Experian and Equifax, to find out what information they hold on your credit file.
What’s a hard search?
On your credit report, you could find two types of search records (also known as credit checks): hard and soft.
A soft search is a review of your credit file that may occur when a lender pre-approves you for a credit card or loan, or when you request your credit report. Soft searches can also be carried out for identity verification. Soft searches don’t affect your credit score, and they’re not visible to other lenders.
Hard searches, which can be viewed by potential creditors, occur when banks and other lenders check your credit report to approve you for credit, which can include credit cards, loans or mortgages.
Multiple hard searches within a short period of time (up to a 6-month period) might alarm potential creditors, who may worry that you’ve taken out too much credit to pay back.
Multiple hard searches within a short time can also lower your credit score by a few points. This might not sound serious, but it may have a greater impact on your score if you have few accounts or a short credit history.
How can you determine whether a credit search was authorised?
There may be a number of ways you can determine if a credit search on your report was authorised. Sometimes, it may be a case of mistaken identity.
Occasionally, the name of the search on your report may be different from the name of the trading name of the business pulling your report.
For example, if you applied for a point of sale loan when buying a sofa or a new computer, the entity listed on your report might be under the name of the company providing the finance, not the name of the store.
Or, you may have forgotten that you authorised a search. If you contact the company listed beside the search on your credit report, it should be able to provide proof that you authorised the hard search, or took an action that would have triggered it.
An unauthorised hard search could be an indicator of identity theft and warrants swift attention.
Credit Karma’s credit monitoring feature alerts you to activity on your report – so you can spot identity theft and fraud quickly.
Bottom line
If you overlook the credit searches section on your credit reports, you could be missing signals that a person or company is trying to open credit accounts under your name without your permission.
It’s a good idea to investigate and dispute any hard searches that you don’t believe you authorised with the companies that conducted them, as well as raising disputes with the credit reference agencies to help you get to the bottom of this activity.