Unfortunately, it means we need to be ever more vigilant in monitoring for fraudulent use of our accounts and of our identities.
On September 7, 2017, giant Equifax, one of three U.S. consumer credit bureaus, announced that its computer system had been hacked, exposing the personal identifying information of 143 million people. The misuse of this stolen information – which includes Social Security numbers – puts “nearly half of the American population,” as the New York Times puts it, at risk for potentially damaging identity theft by unscrupulous data thieves.
In addition to Social Security numbers, these may have been compromised:
- Birth dates
- Driver’s license numbers
- Credit card account numbers
- Other documents containing sensitive information
The company has been extensively criticized for waiting more than a month to announce the breach.
As a remedy, Equifax is offering consumers a year of free credit monitoring, but this is not recommended because of concerns that requesting the service may waive the right to participate in related class action suits or private lawsuits against the company, and would compel any dispute into binding arbitration. In a September 11 statement on its website, the company denies that the contract language found in its free credit monitoring applies, but it has not changed the contract language.
Responses to the announcement have been swift and include:
- At least three class action lawsuits have been filed (Portland, Atlanta and San Diego).
- New York Attorney General Eric Schneiderman has announced an investigation, and ABC News reports that “several” other state attorneys general are indicating they will investigate.
- Congressional hearings are likely.
- Three U.S. senators reintroduced the “Stop Errors in Credit Use and Reporting Act” or SECURE Act to give the Consumer Financial Protection Bureau or CFPB more regulatory authority over credit reporting agencies.
Many people are calling for increased regulation and oversight of these three companies, since they hold such important and personal information of all of us. Compared with banks, credit bureaus do not have the same level of oversight. After all, our files with the credit bureaus are not created at our request.
How should you react if you fear identity theft? For example, your personal information could be used to open accounts, take out loans, access bank accounts and credit card accounts, and in other fraudulent ways to exploit you for financial gain.
First, monitor credit and bank accounts carefully for unusual activity that could indicate an intrusion, including cash withdrawals or charges you did not make. Carefully screen any debt collector who contacts you to be sure the debt it is trying to collect is actually one you owe, instead of one taken out fraudulently with your personal information.
You can request a credit freeze, which can prevent new accounts from being opened in your name because lenders and other sources of credit usually require a credit check before approving a loan, issuing insurance policies, opening bank accounts or even making an offer of employment in some situations. This can also be problematic for you, though, to conduct legitimate business because the freeze would have to be lifted to allow a valid credit request to process.
Another option is to place a fraud alert on your credit reports, which means that any lender requesting information is alerted to take extra precautions to verify the identity of the person requesting credit in your name, including actually contacting you directly. However, this is a temporary fix, requiring you to renew the fraud alert every 90 days.
Currently each consumer can obtain one free copy of his or her report from each of the three credit bureaus annually (in addition to Equifax, these are Experian and TransUnion). It is usually suggested that you request one every four months in rotation. Careful monitoring of the reports can reveal credit inquiries that you did not make, possible indicators of identity theft.
The Federal Trade Commission or FTC is also recommending filing taxes early to prevent identity thieves from obtaining fraudulent refunds using your Social Security number.
Seek legal advice
Unfortunately, if you were a victim of this theft, your Social Security number and date of birth will be insecure for the rest of your life and you must remain vigilant in monitoring for identity theft. If someone has succeeded in using your information to your financial detriment, seek legal advice from a consumer protection attorney as soon as possible to understand how to stop the damage and seek damages, including a potential lawsuit against a credit bureau.
Lawyer Thomas Breeden of Thomas R. Breeden, P.C., in Manassas represents victims of identity theft across Northern Virginia and statewide.