The last 24 hours have seen quite the whirlwind of credit-related activity. Equifax announced on September 7th that they were the victims of a massive data breach into one of their systems. No big deal, right? I mean data breaches happen all the time. Target, Home Depot, Gmail, pretty much every college and university in the country… everyone’s been breached at some point.
But this Equifax breach is significant for two reasons.
The first is the size. An incredible 143 million consumers living in the U.S. have potentially had their information exposed to people with bad intentions.
The second is the value of the information. If your information was exposed, then it likely included your name, address, Social Security number, and date of birth. Those are the crown jewels of information for credit fraudsters because it’s everything you need in order to apply for credit.
The information exposed has what I call “perpetual value.” That means it’ll still be valuable to a fraudster in five years, because it’s not going to change. You’ll still have the same name, SSN, and date of birth. And you’ll likely be living at the same address. Point being, I’d much rather have someone steal all of my credit cards than steal my personal information.
What Should You Do?
The minute you get done reading this, you should go to this page on the Equifax website.
Here you’ll be able to see whether you’ve been impacted, or not. If you have been impacted, then I would highly suggest you place fraud alerts on all three of your credit reports. You can do that at any of these three credit bureau websites:
- Experian Fraud Alert
- TransUnion Fraud Alert
- Equifax Fraud Alert
The good news is that you only need to do this with one of the credit bureaus, and they are obligated under Federal law to notify the other two. The fraud alert will ensure that ANY lender that pulls your credit reports calls you and verifies verbally that you actually submitted a valid application for credit. For most of us, this will be good enough.
If, however, you want to ramp up your defenses a bit, you can “freeze” all three of your credit reports. The practical impact of a freeze is that your three credit reports will be taken out of circulation. That means no new lender (a lender that you don’t have a relationship with) can access your reports, period. You can learn more about how to place freezes on ALL of your credit reports at these credit bureau websites:
- Equifax Credit Freeze
- Experian Credit Freeze
- TransUnion Credit Freeze
Security freezes are not free unless you’ve been a confirmed victim of fraud, but they are very inexpensive. For example, I live in Georgia, and it’s $3 to freeze my credit report. That means I can freeze all three for $9, and that’s a one-time cost, not monthly. It’s the best $9 I’ll ever spend.
Should I Sign Up for the Equifax Fraud Service?
The service Equifax is giving away to basically anyone and everyone who wants it is called TrustedID. It’s a good service, nothing wrong with it at all. Having said that, here are some things to consider.
You’re only going to get it free for one year. That assumes the value of your personal information diminishes after a year, which it does not. If I were one of the fraudsters I’d disappear for a few years and let the heat die down, and then resurface to monetize your personal information.
It only applies to Equifax. The credit report lock aspect of the service only applies to your Equifax credit report, and not your credit reports at Experian and TransUnion. That’s like locking one of the three doors to your house.
You will waive some of your rights by enrolling in the service. I’m not a lawyer and I don’t know what that means exactly, but this has been brought up in tweets and Facebook posts numerous times already, so clearly this is something that’s troublesome to people. You can read more about your rights here.
- Identity Theft Basics
- How to Dispute Errors on Your Credit Report
- Why You Need to Check Your Credit Report With All Three Credit Bureaus
- Best Credit Monitoring Service
John Ulzheimer is an expert on credit reporting, credit scoring, and identity theft. He has written four books on the topic and has been interviewed and quoted thousands of times over the past 10 years. With time spent at Equifax and FICO, Ulzheimer is the only credit expert who actually comes from the credit industry. He has been an expert witness in over 230 credit related lawsuits and has been qualified to testify in both federal and state courts on the topic of consumer credit.