We recently had an application for a credit card that showed a fraud alert. We called the customer to verify in which the customer denied applying. The alert was created sometime in July/August and the credit report showed 4 new accounts since that time for low balances.
I have searched the regulations and all I can locate is that the Bank needs to keep procedures for identity theft which we do. I also see that the Bank cannot report information that is incorrect (the inquiry). I reviewed our procedures and there is no real direction to handle this situation which we will address. In the meantime, can someone point out in the regulations or even what they would do in reporting this incident to the CRA. The customer was alerted verbally, is there more that needs to be done?

Also, the customer was denied due to the score which I am sure was due to this fraudulent activity. I do not see this as an application so no AAN is required. Is this correct?

Thank you