A friend of mine recently had to spend substantial chunks of his week dealing with credit theft. As such things go it wasn’t all that bad but why not spend 30 minutes to save hours?
That same month I got an email for Privacy.com saying that my “Airport Parking” card was declined at “Sayan” (whoever that is). My friend spent hours. I was automatically protected.
One layer of defense is at the credit reporting bureaus which have had to clean up their act after the 2017 Equifax data breach lost my (and probably your) credit information.
Congress, goaded by irate citizens, required improvements, namely credit freezes. Since credit reporting bureaus make their money selling credit information their interests are somewhat in conflict with yours since you only want your credit score accessed when you want to rent something, get a credit card, etc.
There are several steps you can take to reduce your risk. You don’t have to do all of them or do them all at the same time to get the benefit. A few minutes could save you a lot of needless misery. The credit action links take you to the FTC site which is safer than figuring out the correct websites on your own.
1. Freeze your credit
Go to the websites for all 3 major credit reporting bureaus to freeze your credit. That makes it harder for someone to open a credit account in your name. When you need to open an account you can tell the relevant bureau to temporarily lift the freeze using a PIN or the password protected account you created.
2. Lock your credit
Locking your credit is free for Equifax and TransUnion. It means that they will be more careful with requests, such as unfreezing your credit. That would make it harder for an identity thief to unfreeze and then exploit your credit. This is not as important as freezing your credit and some companies have made it harder.
3. Check your credit report
Since you get a free credit report every year from each bureau you can set a recurring appointment and check it every year or check one of the bureaus every 4 months.
4. Set a fraud alert
You can set a fraud alert for 90 days at a time. If your identity has been stolen you can place an extended fraud alert for 7 years. As a bonus that also stops prescreened credit card offers.
5. Opt out of unwanted offers
Opt out of prescreened credit and insurance offers. No one can steal an offer out of your mailbox if there isn’t one there.
6. Use temporary credit card numbers
My bank used to offer this service but I now have a better version of it with Privacy.com (affiliate link that gets you and me $5). These virtual cards are limited to one vendor and can have per transaction/week/year/total charge limits. I created separate cards for my health, dental, and vision insurance plans. If I change providers I simply close the appropriate virtual card leaving no usable card info with a company that no longer has a reason to charge me.
The unfortunate reality is that any company can get hacked and your credit card number stolen. What happens next is up to you.
Privacy.com makes its money by taking the normal fee a credit card company gets from the merchant. They’ve been around since 2016. On November 20, 2020 they detected an attempt to fraudulently charge one of my cards but since their cards lock into one vendor the attempt didn’t go anywhere. The spending limits on these cards have also been very useful to make sure subscription services end when I want them to.
To connect to your bank account Privacy.com asks for your bank password (as do many banks and brokers). If this gives you the willies they provide other verification methods.
Process is:
– Create an account at privacy.com.
– At Privacy.com choose “Help/Support/Submit a request” and ask to authenticate by test deposits.
– Once Privacy.com emails you they are ready at Privacy.com click “Connect a Funding Source”. Click “Bank Account/Connect by Bank Login” Then choose “Routing & Account Number”. Pick this and follow the prompts to connect your checking account.
– In 1-3 days the test deposits from “Privacy” or “Verification” will show up. Do the previous step again but now tell them what the test deposits were.
– They’ll link to your bank account.
– Optionally, you can add two factor authentication (2FA)to the account. Not a bad idea.
When you turn on 2FA and then login it will do an additional check to make sure that you are you. If you use a smartphone app for 2FA you can use VIPAccess or Authy. You probably want to use whatever your bank and/or stockbroker use so that you don’t need two apps.