Consider a security freeze to protect your identity

Consider a security freeze to protect your identity

Is there any downside to building and maintaining a high credit score? Yes. It makes you more vulnerable to fraud and identity theft.

After carefully budgeting and paying your bills on time for many years, it can be frustrating to learn that scammers and thieves are out there especially searching for you. They want what you have. They want to steal your good credit for their own purchases, or to sell it to other scammers and thieves.

Honest people often have a hard time understanding how scammers and thieves think and behave in our digital world. And it's easy to imagine the crooks only as people living in foreign countries, far away.

Having a home security system and anti-theft locks on your vehicles may be a matter of habit for you, but it's possible you haven't thought about protecting your identity as securely as your other possessions.

Even though protection from vandalism and theft is usually covered by homeowners insurance, most of us want to deter vandals and thieves from even trying to damage or steal our possessions. We don't want to experience violation or loss in any way. And yet, our personal identity and good credit may be very vulnerable.

What Does Identity Theft Look Like?
Unfortunately, most people aren't aware of their right to control who is able to access their credit report. But, all three major credit reporting agencies, Equifax, Experian and TransUnion, offer you the option to restrict access to your credit report. They also make it possible for you to decide when and with whom your credit report may be shared. It's called a security freeze or a credit freeze, and it's important to understand how that works.

Here's a real-life example of a credit union member in Texas who didn't know he had the right to restrict access to his credit report. He has a very high credit score, and without his knowledge, an identity thief who was also a resident of Texas was able to establish a new cellphone service and qualify for the purchase of a new vehicle using this man's profile. The cellphone service was already established when the thief shopped for a vehicle online. But that was the beginning of the end of the crime spree.

Three different auto dealerships called the credit union member to verify he was, in fact, going to take possession of the car he'd arranged to buy online. They had found his legitimate phone number on his credit report. You can imagine this consumer's surprise, not just the first time, but each time he got a call. Every dealership alerted the local police, who contacted the credit union member directly for more information.

Turns out, the identity thief was using the cellphone obtained in the stolen name, and also presenting a temporary, new Texas driver's license in the stolen name. Both were obtained prior to his attempts to purchase a car.

The member was advised to call all three credit reporting agencies and put a freeze on his credit report. The identity thief still had his Social Security number, address and credit card numbers, but could no longer use them. The fraudulent cell phone account was closed, at no cost to the member, and the State of Texas rescinded the temporary driver's license.

Without a credit freeze in place, the member would continue to be vulnerable to fraudulent use of his identity by the Texas thief. And he would be vulnerable to other thieves who may have purchased his credit report, as well.

How To Protect Your Identity With A Security Freeze

1).  Call your financial institution to report fraudulent use of your account or credit card if it has been breached.

2).  Call the fraud department of every credit card that is issued in your name. You don't need to cancel the cards, just report the fraudulent use and announce your plans to set up a security freeze with the credit reporting agencies.

3).  Call each of the three major credit reporting agencies to set up a security freeze. Each has its own process and there may be a small fee for the service.
    
      Equifax - 1-800-349-9960
      Experian - 1-888- 397-3742
      TransUnion - 1-888-909-9972

4).  Call each credit reporting agency whenever you want a particular vendor to access your credit report. This is called a "temporary lift" of the credit freeze for one vendor only. The permanent credit freeze remains in place until you choose to remove it entirely. There may be a fee for each temporary lift.

Making the choice to control who can access your credit report (and who cannot) gives you the most security possible, but it requires more work on your part, too. And it may involve occasional but nominal fees. The member in our story decided it was worth the time and small expense to control access to his credit report, because he never wants to go through identity theft issues again.

What will you decide? Will you wait to experience fraud and identity theft issues, or will you be pro-active about restricting access to your credit report now?

SOURCES:
https://www.fdic.gov/consumers/consumer/ccc/reporting.html

https://www.consumer.ftc.gov/articles/0497-credit-freeze-faqs

https://www.freeze.equifax.com/Freeze/jsp/SFF_PersonalIDInfo.jsp

https://www.experian.com/freeze/center.html

http://www.transunion.com/credit-freeze/place-credit-freeze
 


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