How to Keep Yourself Safe Following the Most Recent Data Breaches by Joseph L. Saka, CPA/PFS
Posted on October 09, 2017 by Joseph Saka
On the heels of the Equifax data breach that affected more than 145 million U.S. adults, many consumers are still confused about what they need to do to protect their personal information and their credit ratings. Following are four simple steps you should consider taking now.
Freeze your Credit
A credit freeze blocks individuals and businesses from running a credit check on you and prevents anyone from opening an account or securing a loan in your name without first obtaining your permission. Unlike a credit lock, which is merely an agreement between you and the reporting agency, a credit freeze is the strongest layer of protection against identity theft since it is covered by state laws and provides reassurance that you will not be held liable for any charges or losses caused by fraudulent activities. Yet, credit freezes do come with some costs.
You must separately contact each of the three credit reporting agencies, which include Equifax, Experian and TransUnion. Typically the agencies will charge for this service; however, some are waiving their fees in light of the recent breach. Upon your request, the agencies will provide you with a personal identification number (PIN) that you will need to use should you wish to “thaw” your credit for a specific period of time, such as when you legitimately apply for a loan or credit card. The credit bureaus have up to three days to temporarily lift a freeze, and some will require consumers to pay for this service.
Create a Fraud Alert
A fraud alert on your credit report signals to potential lenders that they must take extra steps to verify your identification before extending credit to you or anyone claiming to be you. However, unlike a credit freeze, fraud alerts will not prevent potential lenders from seeing your credit history. To create an alert, you need to contact only one of the three credit bureaus, which will automatically contact the other two. Fraud alerts, which are free, typically expire after 90 days but can be renewed at your request.
Check and Regularly Monitor your Credit Score and Financial Accounts
You do not need to pay for professional credit monitoring services. Rather, by law, you are entitled to receive one free credit report every year from each of the three credit bureaus. You can easily access these reports for free online at www.annualcreditreport.com. Once you receive a report, you should scan it for abnormal activity and confirm that the accounts listed are for credit cards or other lending instruments that you in fact opened.
Similarly, if you do not already check your credit card and bank account statements on a regular basis, now is the time to start. You may be able to spot an issue before it becomes a bigger problem.
Do Not Share Personal Information via Telephone or Email
Criminals go to extreme lengths to pose as legitimate businesses and government agencies to trick consumers into revealing personal information over the phone and via email and text message. They may go so far as to spoof phone numbers or create websites that look genuine but instead take more of your personal information, which was the case following the Equifax breach. Be alert to these scams and remember that you should never provide personal information over the phone or via email, unless you initiated the communication by placing the call to a number you know or typing in a business’s known website.
About the author: Joseph L. Saka, CPA/PFS, is CEO of Berkowitz Pollack Brant, where he provides a full range of income and estate planning, tax consulting and compliance services, business advice, and financial planning services to entrepreneurs, high-net-worth families and family companies and business executives in the U.S. and abroad. He can be reached at the firm’s Miami office at (305) 379-7000 or via e-mail at firstname.lastname@example.org.