Did the Equifax hack expose you? What should you do now
I hear about security breaches all the time. There have been data breaches at Yahoo and Target that have affected millions of Americans. But none of those hacks could have as devastating an impact as the breach recently announced at Equifax, one of the three major consumer credit reporting companies.
What is Equifax?
Equifax is one of the three major consumer credit reporting agencies. The others are Trans Union and Experian. These companies hold data on any Americans who have been extended credit, including credit cards, mortgages, car loans, and student loans. These companies hold your data including your account number, your balances, date of birth, Social Security Number, and where you live or have lived in the past. This data is accessed by companies to extend you credit, but it is often accessed for other reasons, including background checks for employment or housing.
Why does the data breach matter?
Equifax has said data on 143 million Americans has been potentially compromised. Credit card numbers for 209,000 Americans have been compromised. This compromised data can allow identity thieves to open credit in your name and steal your identity. This could affect you when you apply for credit or if you have to undergo some sort of background check. Creditors can come after you for amounts you never borrowed and for credit accounts you don’t even know about. Identity theft can become a nightmare. Here is an article in Bloomberg about the data breach.
What should you do?
Equifax has a website http://www.equifaxsecurity2017.com/ which you can use to find out if you have been affected by the hack. You have to enter your last name and the last 6 digits of your Social Security number. I tried it and it told me I WAS affected and would be offered a year of free credit monitoring. I will sign up for that, but monitoring only works to detect fraud that already happened. It does nothing to prevent it.
Preemptive anti-fraud measures
There are a couple of preemptive anti-fraud measures you can take. The most drastic is to put a credit freeze on your account. No one can provide you new credit with a freeze on your account and you will have to remove the credit freeze to allow access. This can be inconvenient and it does not prevent people from gaining your confidential information illicitly, but it does stop people from opening credit in your name, one of the most pervasive types of identity theft. The three major credit reporting companies have this service available on their website, but they will charge a fee varying by state to freeze your credit. Here are links to the web pages:
Another service that the credit reporting companies offer is a fraud alert. This is a signal to creditors that they need to be more careful in granting you credit because your account may have been hacked. You can provide a phone number through the fraud alert that the creditor is supposed to use to contact you if credit has been requested in your name. There are three types of fraud alert: An initial fraud alert which the credit reporting company will put on your account upon your request, a military active duty fraud alert just for active duty military, and an extended fraud alert which requires documentation on the fraud from law enforcement. The initial fraud alert is only for 90 days. The active duty alert is 1 year, and the extended fraud alert is 7 years. The good news is that for fraud alerts, you only have to contact one of the companies. That one will report the fraud alert to the others. Here are some links to put an initial fraud alert on your name:
Free Annual Credit Report
You can get a free annual credit report from all three credit reporting companies. I recommend doing this anyway. Its a good way to see if there are errors on your credit report. There is a specific website that works for all three credit reporting companies. You could get a report from one of the companies every 4 months to keep regular watch on your credit report.
Credit Monitoring Services
I am not a big fan of credit monitoring services. They might let you know about fraud after the fact, but they do little to prevent it. These services are quite expensive. You are entitled to a free report once a year anyway, so why bother paying for it? Some of the services also have an insurance aspect, where they pay your costs to recover from identity theft. It seems attractive, but they don’t pay the true costs of identity theft which include loss of the time it takes to clean up your credit, possible loss of employment opportunities, and the inconvenience of explaining the identity theft all the time.
But I will still sign up for the service Equifax is offering for free to victims of their poor security practices. But once the free period expires, I will not pay for it.
What did I do?
I decided to put an initial fraud alert on my name with Trans Union. They will notify the other companies. I also checked my credit report to make sure it was OK now. The hack actually occurred back in July, so there was a chance fraud already happened. I will sign up for the free credit monitoring. At the end of the 90 days, I might just put another initial fraud alert on my account to keep it going. I might choose to implement a credit freeze. But now I have 90 days to think about it. I urge you to take this data breach seriously. Please take action.