Are You Wasting Your Money on Credit Monitoring?
By Bryant
Sandburg, Identity Protection Specialist
Identity theft is the world's fastest
growing "white collar" crime. It's now a $105 billion cash cow for
professional criminals—bigger than illegal drug
trafficking in the U.S.—
with more than 20 million victims expected
this year (2008). As a result, a huge new industry has bloomed: the
identity protection business.
One of the most heavily advertised items on
radio and TV these days is credit monitoring. Companies like LifeLock,
TrustedID, FreeCreditReport.com, and others warn of the dangers of
identity theft and then push the idea that all you have to do is have
them watch your credit, put a freeze or fraud alert on it, and you'll be
OK.
Here's the problem with that. Only one-third of
all identity theft cases have anything to do with credit fraud. Which
means that the majority of these crimes—two thirds—
are committed in ways that are not covered by any of those
heavily advertised programs.
How do you find out if an illegal alien has a
driver's license with your name on it? How do you find out that someone
got a job using your social security number? Or a passport? None of
those things will ever show up on a credit report.
And that thing about putting a fraud alert on
your credit? Turns out that's not such a good idea, either. In the first
place, a fraud alert on your credit record can cause you inconvenience
and embarrassment. What if you are shopping in a store that has a great
today-only offer if you just open a charge account? They check your
credit, right? Well, only about 50% of the time. Did you know that? If
they do the credit check, you get an instant denial, and maybe some
funny looks from a store clerk. If they don't check it, well,
you're OK. But so would a thief 50% of the time!
Let's take a closer
look at that 67% of non-credit-related identity theft crimes. How do
thieves really get their hands on your information? According to the
experts at the Federal Trade Commission, the FBI, and independent
sources such as the Identity Theft Resource Center, there are three main
sources.
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3 Sources of Identity
Information
#1. Public
records
Your information is scattered in records
all over the place, collected by every agency under the sun since
the day you were born. Often these records are open to public
view. Property records, for example, are public, and if you've
ever had a mortgage there's a good chance your social
security number is right there for anyone to see.
#2. Data
breaches
The personal information of more than half
the U.S. population has been exposed due to data breaches. From
January 2005 to the end of June 2008, over 230 million records have been
lost or stolen from companies and agencies nationwide. In 2007 alone,
the Identity Theft Resource Center identified 446 data breaches
with more than 127 million records exposed. Much of this data
reaches criminal hands on the black market.
#3. Mail
theft, dumpster diving, and other
Rings of thieves
break into mail boxes looking for mail that may have your
information. Bank statements, for example.
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The fact that your personal information
records may have been exposed doesn't mean your identity has already
been stolen. But it could be "out there" circulating in the underground
"id" markets where no credit monitor will ever find it.
The reality is that credit
monitoring is not identity protection.
Are You Wasting Your Money on Credit Monitoring? By Bryant
Sandburg
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