This month we learned of a massive data breach at one of the three major credit reporting agencies. Equifax disclosed months-long theft of over 140 million users information, including Social Security numbers, addresses, telephone numbers, drivers license numbers, and some bank information. Given how substantial this breach of information is, I felt it necessary to help our clients better understand what they can do moving forward.
Background
Equifax, Experian, and TransUnion are the three major credit reporting agencies used by mortgage lenders, credit card companies, and banks for determining risk in issuing credit. Our credit use, history of payments, income, etc are used in algorithms to determine our Credit Score, which of course is used to determine creditworthiness and interest rates for consumers. Unfortunately, we have no control over whether these companies gather our information, as banks and other financial institutions issue our private data to them.
The breach that occurred is vast and concerning for various reasons. First and foremost, our personal information and financial information is in the hands of someone without our consent and can be used for various fraudulent activities. Given the information stolen, a hacker could easily open a credit card account, try to purchase a vehicle, or issue themselves a fraudulent ID with your information.
Secondly, it exposes the risk in online data systems that the end user (i.e, you and I) have no control over.
What Can You Do to Protect Yourself
Until we find out further information from Equifax and possible criminal federal investigations, here are some relatively simple steps you can do to protect yourself, especially if you are considering a major purchase in the near future.
- Check your credit score: This is good advice regardless. Check your credit score often and make sure nothing out of the ordinary or suspicious shows up. The longer you wait, the less likely you will be able to fix an errant claim.
- Freeze your accounts: Transunion, Equifax, and Experian allow you to freeze your account. This means that you or a criminal will not be able to open a new credit line without “thawing” your accounts. In this case, you can freeze your accounts and would need to call and “thaw” your account each time you want to take out a new line of credit. This would be for credit cars, auto loans, home mortgages, and so on.
- Monitor your existing credit lines: Again, this is good general advice. Monitor your existing credit cards and loans. Make sure nothing you cannot account for shows up. Many times, hackers will do a few small purchases to test the water and see if you notice before they go big. Be vigilant.
- Sign up for identity theft monitoring: If you are short on time or unfamiliar with many of the above steps, sign up for an Identify Theft Protection company. Companies like Life Lock, Identity Force, and Credit Sesame can help monitor any suspicious activities.
- Be careful online: Finally, be careful about who you do business with online. A general rule of thumb is that if it feels or looks suspicious, it probably is. If you feel like something isn’t quite right when putting in your personal information online, pause and do a quick Google search to ensure it’s legitimate. Unfortunately, the internet can be a very deceptive and dangerous place.
Moving Forward
I hope you find this information useful and can protect yourself from any major financial consequences due to the data breach. Sadly, there is no timeframe as to when someone may try to use your stolen information; therefore these practices should be best practices moving forward. As a professional in both the Information Technologies world as well as real estate, I understand that any hiccups along the way during a home purchase can quickly derail you from your dream home. Let’s make sure that does not happen.