Equifax Hack: How To Protect yourself from the three headed dragon

Greetings my financial cave dwellers. Today we tell a tale of a three-headed Dragon so deeply entrenched in our personal data we aren't even aware that we are being spied on without our consent.

Yes, unlike the temptations of American consumerism, this fleecing of our personal data starts when we enter the world. The recent discoveries of the Equifax hack where over 143 million people get their personal data compromised are just a preview of whats to come should the other two heads of this credit beast (Trans Union, Experion) get hijacked by the clever sorcerers of the internet also known as hackers. 

And in some cases, these companies stand to profit by leaking your private information. For example, Equifax has a "free" credit monitoring service. While the service is free for the first year, if you forget to cancel the service, Equifax will auto-bill you $17 per month. I could only imagine that millions of people will flat out forget they have signed up for this service. Therefore, millions of dollars in profit will flow into the Equifax bottom line. 

But it gets worse, there is a company called, LifeLock. This company sounds legitimate by all means and they might as well be offering a solid product. However, they pay Equifax money for credit monitoring services. Since the Equifax hack, Lifelock signed 100,000 new customers at $29.95 per month, and Equifax gets a big cut from each of those new customers' fees according to US Senator Elizabeth Warren. 

Last but not least, Equifax just scored a seven million dollar contract to protect the IRS from, wait for it, fraud. Yes, fraud my friends. A company that leaked our data to hackers and now stands to make millions from this leak just got awarded money to protect IRS from fraud. 

Why are we so darn complacent about these credit companies?  

• According to Bloomberg, Equifax Suffered a Hack Almost Five Months Earlier Than the Date It Disclosed. 
• We never signed up for this service and in order to protect our identity, we are expected to pay money for a credit monitoring program? 
• You can call the hotline from these companies and if you actually talk to a human, you get poor customer service if any based on my experience. 
• How did you hear about this hack, did the company that screwed up call you and apologize? Not likely, you probably heard about this hack from the news or social media. 
• To these Credit companies, we are not customers. We are products. This is because these credit companies get lenders and others to send over our payment history, they aggregate our data and resell our personal information in a global market without our consent. 

More or less these credit companies answer to no one. And I have just shown you how they can actually profit from leaking our information. Essentially, the incentive model here is backward and not in our favor. What I mean specifically is, there is no reason for these credit companies to clean up their act. We should bet on this three-headed privacy leaking dragon to continue to profit from spewing our personal identifiable data all over the world. 

So what can we do? 

Now is the time to take action and protect yourself. I personally don't subscribe to the whole credit and debt thing. For me, I pay for all purchases with cash. Therefore, I have a whopping zero credit score and a fantastic positive net-worth as a consequence of not buying things I can't afford. Because of this, I plan to freeze my credit score. A Credit score freeze will block anyone from accessing your personal data unless they use a PIN that you establish. You can always unlock your credit for a temporary time should you need someone to view your credit information. Freezing your credit does not negatively affect your existing lines of credit (loans, credit cards etc)  you can continue to use these services with no negative impact. 

When you shouldn't freeze your credit:  In some situations, you may need your credit checked if you are applying for a job or when you are moving and need to get the utilities established in your name. In a future post, I will share my tips of how I survive/thrive financially with a zero credit score. 

Freezing your credit will not stop all thieves from stealing your identity. But this is an added layer of protection with minimal effort. 

How to freeze your credit score: 

TransUnion
By phone: 1-888-909-8872
By mail: Request your credit freeze by certified mail using this sample letter. Please note the attachments you must include.
Use the following address:
TransUnion LLC
P.O. Box 2000
Chester, PA 19016


Equifax
Important note: With such high traffic to the website, if you can’t get your request processed, just wait about a week and try again.
By phone: 1-800-685-1111 (NY residents please call 1-800-349-9960)
By mail: Request your credit freeze by certified mail using this sample letter. Please note the attachments you must include.
Use the following address:
Equifax Security Freeze
P.O. Box 105788
Atlanta, GA 30348


Experian
By phone: 1-888-EXPERIAN (1-888-397-3742). When calling, press 2 and then follow prompts for a security freeze.
By mail: Request your credit freeze by certified mail using this sample letter. Please note the attachments you must include.
Use the following address:
Experian Security Freeze
P.O. Box 9554
Allen, TX 75013