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Is there a way to set alert or some type notification that alerts the owner of the site when a new person is added to the site(when permission is given to a new user)

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    Said's answer is a good choice. You might be surprised at how many ways a user can be added to a a site's user list other than intentionally granting them access. An alert on that data would quickly become inbox chaff.
    – ghangas
    Commented Aug 17, 2017 at 16:29

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You can use the following tool : https://lightningtools.com/permissions/sharepoint-permissions-auditing-and-alerts/

Otherwise, if you are limited to OOB features, you can at least audit it SPS 2010:

In site collection root site, Site Actions -> Site Settings -> Site Collection Administration -> Audit log reports -> Security settings, we can see the permission audit log report.

Before viewing the audit log report, it is needed to specify the Editing users and permissions events to audit.

In site collection root site, Site Settings -> Site Collection Administration -> Site collection audit settings, check the Editing users and permissions option.

After doing this, the changes to permissions on sites, lists and items will be audited in audit log report.

This is a link about viewing audit log reports for your reference:

http://office.microsoft.com/en-us/sharepoint-server-help/view-audit-log-reports-HA102039795.aspx#_Toc272842196

Regards,

Saïd

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You need to activate auditing on the SharePoint server and track every change happens on the SharePoint server. Please refer to the following article

http://blog.ciaops.com/2015/04/enabling-sharepoint-online-auditing.html

http://sharepointauditing.blogspot.in/

Also check the below earlier threads:

https://social.technet.microsoft.com/Forums/sharepoint/en-US/8b974b21-01f3-487b-b581-b6026b867c81/alerts-for-when-permissions-change?forum=sharepointadminlegacy

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