With the proliferation of identity theft, consumers are realizing that no one solution exists to protect their personal information all the time. Yet, millions of Americans continue to pay for services intended to reduce their risk of becoming victims even at a time when the government provides one of the strongest layers of protection for free.
All three of the major credit reporting bureaus, including Equifax, Experian and TransUnion, have eliminated fees for credit freezes, which security experts claim are the best tools to prevent criminals from stealing your identity and using that information to fraudulently secure loans or open financial accounts in your name.
With a credit freeze, the credit bureaus are required to keep your personal information private and block anyone from running a credit check on you without first receiving your approval, which can only be accomplished by a credit “thaw” that you authorize via a personal identification number (PIN). Unlike a credit lock, which is merely an agreement between you and the reporting agency, a credit freeze is covered by federal and state laws and provides reassurance that you will not be held liable for any charges or losses caused by fraudulent activities. However, a freeze should not be your only line of defense.
It is also valuable to create a fraud alert on your credit report to ensure that lenders 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 a free fraud alert with all three credit bureaus, you need only contact one of the three reporting agencies. While fraud alerts will expire after 90 days, you can renew them continuously.
Finally, it is critical that you regularly monitor your financial accounts on a regular basis to identify potential issues before they become big problems. As an added layer of protection, you may want to create fraud alerts directly with the financial institutions that issued credit cards to you.
Similarly, as time-consuming as it may seem, you should check your credit report throughout the year. 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.
With the expanding scope of data breaches and increasing frequency of identity theft, consumers must take precautions to protect their personal information and remain vigilant against the often sophisticated schemes that fraudsters employ. Following are 10 tips to keep in mind at all times.
About the Author: Jamel Gordon, CFP®, is a financial planner with Provenance Wealth Advisors, an Independent Registered Investment advisor affiliated with Berkowitz Pollack Brant Advisors + CPAs and a registered representative with Raymond James Financial Services. He can be reached at (954) 712-8888 or via email at firstname.lastname@example.org.
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Jamel Gordon, CFP® is a registered representative of and offers securities through Raymond James Financial Services, Inc., Member FINRA/SIPC.
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