I’m Researching Ways to Protect Myself Against Identity Theft
Alternatives I’ve found lacking in my eyes...
Like an ostrich pulling its head out of the sand, I’m finally facing up to the reality that identity theft is more than news-fodder, and could happen to anyone. Here’s a summary of what I’ve found so far -- along with my views on the pros and cons for each alternative.
MY GOAL
Specifically, I want to eliminate the risk of someone using my identity to establish new credit in my name. At this point in life, I place little value on having access to “instant credit”, so my first choice is to institute a complete “credit freeze” -- blocking all unauthorized access to my credit records.
ALTERNATIVES
1. Free One-Time-Per-Year Credit Reports from the 3 credit reporting firms (www.annualcreditreport.com).
While the price is right, in my eyes once a year is not enough. If a thief has access to your identity for a few months, or even a few weeks, the damage has already been done.
2. 3-in-1 Monitoring Services (like Equifax Credit Watch). This type of service provides “automatic notification to key changes to credit files from any of the three credit reporting agencies”. This should enable early detection of thieves attempting to use your identity to add, change or use credit-related services in your name. Cost is $130 / year.
Certainly knowing sooner is better than later. But again, notification is after the (initial) damage has been done. And you, the consumer, are still left to clean up the mess.
3. “Identity Theft Insurance,” which is now available from a number of sources. In the event of identify-theft, this product reimburses the policy holder for some of the costs associated with restoring your identity. Coverage is typically limited to about $25,000. And, because reimbursement is limited by area of coverage (i.e up to X dollars for lost wages; up to Y dollars for overnight mailings; up to Z dollars for legal expenses, etc.), if a claim were to be filed, the payout may be underwhelming. Costs run about $25 - $60 per year.
In my eyes, this type of product is best suited for people lacking sufficient emergency funds to self-insure for the basic costs covered in the policy. In fact, according to Forbes...
“(identity theft insurance is) ...not really insurance and can increase the risk of becoming a victim by creating a false sense of security. Also, the apparent low cost of $25 to $60 for a policy actually isn't a good value relative to the risk.”
No thanks, I’ll pass on this one.
4. “Fraud Alert” - Assuming you’ve experienced identity fraud, and have the appropriate papers from the police, you can place some level of controls on your accounts (at the 3 credit reporting firms) for up to 7 years, apparently at no cost to the consumer.
This sounds like something that might begin to meet my needs. But, since I have no basis to go to the police, this is not an option for me.
5. Credit Freeze - This option allows a consumer to completely “lock out” new access to their credit files (at the three credit reporting firms). This makes it impossible for a thief to establish new credit / change existing records in your name. Unfortunately, Equifax customer support told me that this option is only available if you live in California or Texas.
This product looks ideal for my needs. Unfortunately, my state is not covered, so again this is not an option for me. Note: If you decide to pursue this option, I’d advise you look further into the details / costs.
WHAT WORKS FOR ME?
Given I don’t qualify for my first choices: Fraud Alert or Credit Freeze (options 4 & 5), my decision comes down to the Free One-Time-Per-Year, or a 3-in-1 Monitoring Service for about $130 / year (options 1 & 2).
Is it worth $130 / year to have immediate notification that the “horse has left the barn”? My cautious side says YES. My penny pinching side says NO. While I need some time to think about it, my cautious side is likely to win this one.
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$130 isn't that bad, depending on how you value your identity. And if you shop around various services, you'll find that some 3-in-1 services offer insurance to cover time off of work and fees one may incur cleaning up their credit record.
Citibank offers a branded version of Intersections Identity Guard, if you have a Citi credit card, for $9.95 a month. Initially it's only configured for Equifax, but if you mail in a form in your welcome packet or do something on your profile on the web site, you get access to all 3 credit reports from Equifax, Experian, and Trans Union. Worth a look, perhaps.
Keep in mind that you can pull one free credit report per year PER BUREAU. Thus, you can space these out once every four months and check your credit three times per year. Perhaps that's still not enough to make you feel comfortable, but it's a lot better than once per year.
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http://www.fivecentnickel.com/
By the way, I've placed a temporary (90 day, I think) fraud alert in the past, and then had it extended to seven years without filing a police report. I just requested it in writing. But maybe they've changed how it works since then.
This is pretty much as good as an outright freeze, as they can only extend credit after contacting you at a phone number that you provide when setting up the alert. Then again, some creditors might not pay attention to the alert.
By the way, getting the fraud alert removed was a pain in the butt -- it took several months and multiple letters, followed by a couple of phone calls and a fax to finally get it taken care of at one of the bureaus.
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http://www.fivecentnickel.com/
This is so ridiculous. Here you guys are debating on whether or not YOU should spend YOUR money to protect your credit report when it's the Bureaus fault for letting it get out in the first place.
I have a suggestion:
WRITE YOUR SENATORS AND CONGRESSMAN and demand the laws be changed to:
1. Punish data collectors for incompetence
2. Increase the penalties for ID thieves
3. Allow YOU to control who has access to YOUR info.
Anything else is just stupid.
Dear Guest,
I am a victim of ID theft. I've gone through nightmares of someone using my SS# to open fraudulent bank accounts. The thief even bought some type of mobile home somewhere in Texas and got a mortgage loan using my SS#.
Untill your congressmen finished reading all your letters and actually have the solution for these type of crime then IT IS NOT stupid to spend a little bit of your money for your own protection and peace of mind.
1stMill: I've been using this service, http://www.privacyguard.com, to monitor my credit reports. It's cheaper and you can try it first for 2 months with only $1.
Thank you to all for your comments. I've been procrastinating on this decision, so your comments are helpful. 1stMill
Funny how Europeans don't seem to have this problem to the same extent....I wonder why? Oh yeah....they passed laws to prevent it from happening!
http://moneycentral.msn.com/content/Banking/FinancialPrivacy/P116528.asp
Nothing is ever 100% secure but to have to pay to monitor your own information (which you don't have control over) is ridiculous.
Holy cow,
Have you read www.privacyguard.com "privacy" policy?
We use personal information provided on registration forms to fulfill requests for credit reports and requests for other personal information and to contact you when necessary, such as when your request cannot be processed. Trilegiant Corporation may also use this information to notify consumers about new products or services and special promotions offered by Trilegiant Corporation or any of its affiliates. ... From time to time, we may also share your Personal Information with trustworthy unaffiliated third parties, who offer products or services that we feel may be of interest to you.
We may share Personal Information relating to your transactions or experience with us, with our affiliates, such as the other membership services operated by Trilegiant Corporation and its affiliates (including those existing currently or in the future).
Wow. I wouldn't want to fork over all my personal info only to be shared with "trustworthy" unaffiliated third parties (is this an oxymoron?) whomever PrivacyGuard feels would be of interest to me.
Guest:
You can always OPT OUT.
I agree with you. It is such a sad way to pay fees to protect our own identity but since we don't have that kind of law in US yet then I don't see any other way. At least for now.
Victim:
Agreed. But I think that is where the major problem exists: You have to "Opt Out", the default is to automatically give away your info where as laws should mandate that the default should be to automatically Opt Out of everything....
Do you know how long it takes me to Opt Out of all of the following:
1. My car insurance sends me a notice that they will share my info unless I opt out.
2. My life insurcance co sends me a notice that they will share my info unless I opt out.
3. My Telephone (landline) company recently sent me a notice that my info would be shared unless I opt out.
4. My 3 credit card banks sent me notices that they would share info unless I opt out
5. My checking (banks) sent me notices that they would share info unless I opt out.
6. My mortgage company sent me notices that they would share info unless I opt out.
7. My cell phone company sent me notices that they would share info unless I opt out.
8. My two brokerage firms said they would share my info unless I opted out.
9. My Credit Bureaus (all 3) will share my info unless I opt out.
10. And then there are the 20+ internet accounts (ebay, yahoo, google, etc) that you have to opt out of.
And you would think there would be one universal way to opt out of all these things but some require you to call a number, others go online, yet others fill out form and mail it to them.
How much time do you think it would take me to "Opt Out" of all these things? What happens if I miss one?
Laws need to change but probably won't ever happen since it would likely affect 1% of business profits and money is everyone's god around here these days.
Sorry but I'm bitter about this because I do have relatives who's lives are near ruin because of ID theft and no one is doing anything about it.
Except me - I worte my Senator and Congressman.
