Your $125 and Credit Freeze

In 2017, the credit bureau Equifax–one of the big 3 including Experian and TransUnion–admitted that it had suffered a massive security breach, exposing the personal information of nearly 145 million people, probably including you. Personal data stolen from Equifax included names, birth dates, social security numbers, addresses, drivers license numbers…basically everything bad guys need to steal your identity and open credit accounts in your name. Because their carelessness and negligence enabled the breach, and their delay in revealing the breach exacerbated danger to the public, Equifax recently agreed with the FTC to pay a settlement of $300-$700 million. Though this is little more than a slap on the wrist for a company of that size, it is better than nothing. There are many online instructions on how to claim your $125 from this settlement, or up to $20K if you suffered identity theft and resulting damages and expenses, including this ArsTechnica article, in a simple 2-step process: (1) confirm your eligibility, then (2) submit your claim online. Sure, this requires you to provide your information again to the same company that failed to protect it in the first place, but the cow is out of the barn, so you might as well get paid. As an alternative to cash, Equifax offers free credit monitoring for several years, but this is of little value given the limitations of credit monitoring services and the availability of similar free services elsewhere (e.g., Credit Karma and NerdWallet), not to mention your responsibility to monitor your own credit activity. I claimed the money.

While you claim your Equifax settlement and review your free annual credit report, you may protect yourself by placing a free credit or security freeze on your account with each of the 3 credit bureaus. This NerdWallet article explains the free credit freeze (vs a “credit lock”, which may not be free) and provides the necessary web links (and phone numbers if you’re old school). It only took several minutes for me to create accounts with each of the 3 credit reporting companies–Equifax, Experian & TransUnion–and freeze my credit with each. I created a unique PIN for each that I can use to un-freeze my credit when I need to apply for a new credit card or loan. Anyone lacking those PINs will be unable to gain approval from the credit bureaus to open a new credit account in my name. I suggest that you create your own credit freezes for much more protection than mere credit monitoring.