Feds Require Financial Firms to Take Identity Theft Prevention Steps
National News • October 31, 2007
Federal regulators are requiring that every financial institution have a program to detect and prevent identity theft on consumer accounts.
The federal financial institution regulatory agencies ...
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Subject: RE: CREDIT FREEZES WORK
Posted On: November 1, 2007, 10:14 am CDT
Posted By: John Doe
Comment:
Security freezes stop identity thieves cold
June 28, 2007
Growing concerns about identity theft have spurred state lawmakers across the country to look for new ways to safeguard consumers from this insidious form of fraud.
Because of this, most Americans now have a new tool that provides powerful protection to stop thieves from ruining their credit records.
Every day, about 27,000 Americans are the victims of identity theft, according to the Federal Trade Commission. In about a third of those crimes, crooks use the information to open new accounts in their victims' names.
Armed with just your name and Social Security number, a thief can open fraudulent accounts and start charging away, leaving you with a damaged credit record that might take years to repair.
But the landscape is improving with security freezes, a safeguard promoted by Consumers Union (the nonprofit publisher of Consumer Reports) and other consumer groups that has been adopted in 37 states and the District of Columbia. A freeze essentially locks up the information needed to conduct a credit check, and creditors won't open new accounts without that check. An imposter will be foiled, but you can lift the freeze using a PIN if you want to open new accounts.
A security freeze provides much stronger protection than the fraud alert currently available under federal law.
An alert placed on a credit file amounts to a caution flag that is supposed to trigger added scrutiny by creditors. But it doesn't stop potential creditors from getting a credit report or credit score.
A security freeze prevents thieves from opening new accounts and hurting your credit.
Thirty-three of the states that have security-freeze laws make this safeguard available to everyone, regardless of whether a person has been a victim of identity theft. Most states that offer a security freeze make it free to identity-theft victims, and some provide it at no charge to seniors.
For those consumers who want the freeze but aren't victims of identity theft, most state security-freeze laws allow each of the three major credit bureaus to charge $5 to $10 to initiate the protection or to lift the freeze. The best state laws keep all fees at $5 or less and allow consumers to temporarily lift or remove the freeze without charge.
Under the radar
If you haven't heard about security freezes, it's not surprising. Credit bureaus aren't eager to spread the word because they have a financial incentive to make it easy for potential creditors to check credit reports. Credit bureaus also make big bucks from selling to consumers more expensive credit-monitoring services, which are unnecessary, especially when a security freeze is in place. Consumers Union has asked the Federal Trade Commission to help inform consumers about security freezes.
States with the user-friendliest laws allow consumers to request this protection by e-mail or by phone, and will require credit bureaus to lift the freeze within 15 minutes of a request. To find out whether your state offers security-freeze protection and how it works, go to: www.ConsumersUnion.org/ SecurityFreeze.htm.
Visit the Consumer Reports Web site at www.consumerreports.org.
Subject: RE: CREDIT FREEZES WORK
June 28, 2007
Growing concerns about identity theft have spurred state lawmakers across the country to look for new ways to safeguard consumers from this insidious form of fraud.
Because of this, most Americans now have a new tool that provides powerful protection to stop thieves from ruining their credit records.
Every day, about 27,000 Americans are the victims of identity theft, according to the Federal Trade Commission. In about a third of those crimes, crooks use the information to open new accounts in their victims' names.
Armed with just your name and Social Security number, a thief can open fraudulent accounts and start charging away, leaving you with a damaged credit record that might take years to repair.
But the landscape is improving with security freezes, a safeguard promoted by Consumers Union (the nonprofit publisher of Consumer Reports) and other consumer groups that has been adopted in 37 states and the District of Columbia. A freeze essentially locks up the information needed to conduct a credit check, and creditors won't open new accounts without that check. An imposter will be foiled, but you can lift the freeze using a PIN if you want to open new accounts.
A security freeze provides much stronger protection than the fraud alert currently available under federal law.
An alert placed on a credit file amounts to a caution flag that is supposed to trigger added scrutiny by creditors. But it doesn't stop potential creditors from getting a credit report or credit score.
A security freeze prevents thieves from opening new accounts and hurting your credit.
Thirty-three of the states that have security-freeze laws make this safeguard available to everyone, regardless of whether a person has been a victim of identity theft. Most states that offer a security freeze make it free to identity-theft victims, and some provide it at no charge to seniors.
For those consumers who want the freeze but aren't victims of identity theft, most state security-freeze laws allow each of the three major credit bureaus to charge $5 to $10 to initiate the protection or to lift the freeze. The best state laws keep all fees at $5 or less and allow consumers to temporarily lift or remove the freeze without charge.
Under the radar
If you haven't heard about security freezes, it's not surprising. Credit bureaus aren't eager to spread the word because they have a financial incentive to make it easy for potential creditors to check credit reports. Credit bureaus also make big bucks from selling to consumers more expensive credit-monitoring services, which are unnecessary, especially when a security freeze is in place. Consumers Union has asked the Federal Trade Commission to help inform consumers about security freezes.
States with the user-friendliest laws allow consumers to request this protection by e-mail or by phone, and will require credit bureaus to lift the freeze within 15 minutes of a request. To find out whether your state offers security-freeze protection and how it works, go to: www.ConsumersUnion.org/ SecurityFreeze.htm.
Visit the Consumer Reports Web site at www.consumerreports.org.