Despite what you’ve seen on the TV ads, credit-monitoring services can’t purge your data from the cyber underground marketplace, but they can help correct problems if identity theft occurs.
Lately, we’re all worried about what crooks might find out about us on the “dark web.”
Given high-profile data breaches at places such as Blue Cross Blue Shield of Michigan and Health Alliance Plan, as well as Marriott and Equifax, it’s not surprising that consumers are running scared.
Consumers, though, might be expecting a bit too much when they sign up for costly credit-monitoring services. Do you really think, somehow, you can pay somebody to remove your Social Security number or credit card information from nefarious areas on the internet used for criminal activity after you’ve suffered identity theft?
About 36 percent of consumers who have seen ads for “dark web monitoring” incorrectly believe that identity theft services can remove their personal information from the cyber underground marketplace.
“That would be a very compelling reason to sign up,” said Susan Grant, director of consumer protection and privacy for the Consumer Federation of America.
But it’s not going to work that way. Some services might help you correct problems if ID theft takes place, but again, a service cannot erase what information is already out there.
The watchdog group’s report also noted that 37 percent of those surveyed also mistakenly believe that these services can stop fraudsters from using your personal information on the dark web.
Identity theft was the third most common complaint in 2018 that was made to the Federal Trade Commission — behind No. 1 impostor scams and No. 2 debt collection complaints.
The FTC noted that there was a 24-percent increase last year in identity theft reports that involved credit card fraud on new accounts. At the same time, though, the FTC saw a 38-percent drop in reports involving tax identity theft. You can file a complaint at www.ftc.gov.
“People have a heightened awareness because of all these problems,” Grant said. “They’re worried about identity theft.”
While monitoring services may be able to alert people that their information is being fraudulently used, Grant said, consumers need to clearly understand that they “can’t put the genie back in the bottle.”
Identity-theft services often monitor personally identifiable information in credit reports and look at other public records, commercial data bases and the internet for signs of fraud. Prices can vary widely and be more than $30 a month for families.
These services also usually provide advice about what to do if consumers’ information is being used fraudulently and offer some insurance.
But Grant warns that consumers need to carefully review what’s really covered, noting that this insurance provides very limited reimbursement for certain costs to deal with identity-theft problems.
“It’s important to understand how identity-theft services work and the limits of what they can do,” Grant said.
Identity-theft services can be useful in alerting consumers about possible fraudulent use of their data. But there are limits to what can be stopped from happening in the underground marketplace.
“It sounds so sinister,” Grant said. “And so it makes people worried, and they think they ought to do something about it.”
In many cases, you cannot afford to ignore threats of ID theft.
“If you are alerted that your personal information is being bought and sold on the dark web, you can’t stop it, but you can do some things to limit the damage,” said Adam Levin, founder CyberScout, which offers identity and data defense services.
Levin said consumers can minimize the risk in face of continuing exposure by having their bank issue a new credit or debit card, closing a bank account and opening a new one, changing passwords “anywhere and everywhere,” and freezing your credit.
Before you panic, here are some things to consider about ID theft:
All identity theft mishaps aren’t fatal
While highly annoying, some common problems resulting from ID theft are relatively easy to fix, according to consumer watchdogs.
Say you spot someone charged $9.99 on your credit card for something you know you didn’t buy. It’s a small charge but still important to act on, since this could be a sign that the crooks are testing to see if this is a live card.
Contact your credit card issuer immediately.
Remember, you’re only responsible for up to $50 for charges you didn’t make, and you probably wouldn’t have to pay for anything if you report such charges promptly. Many credit card issuers promise zero liability.
If you report a lost or stolen credit card before it is used, the card company cannot hold you responsible for any unauthorized charges, according to the Consumer Financial Protection Bureau.
If you have not lost the card itself, but someone steals and uses your account number, you generally have no liability for unauthorized use. But you still want to take action and contact your issuer immediately.
One of the best defenses remains to watch all your statements regularly.
Review your credit reports to spot ID theft
Make sure to take time to order your free annual credit report each year. You can obtain reports from the three nationwide credit reporting companies through a central website, a toll-free telephone number, and a mailing address. It’s possible to spread out when you order each report during the year.
Visit annualcreditreport.com or call (877) 322-8228. Or complete the Annual Credit Report Request Form and mail it to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.
If you request each of the three reports separately, you can monitor your credit files at no cost more frequently throughout the year.
Think about freezing your credit
If you know you don’t want to open a new credit card or take out a car loan soon, consider putting a security freeze on your credit report. A freeze will generally stop an ID thief from opening new credit in your name.
You would have to unfreeze your file before you can open a new credit card or a take on a new mortgage.
A freeze is available to anyone, whether or not you are a victim of identity theft.
You are allowed under law to freeze and unfreeze your credit record for free at the three nationwide credit reporting companies — Experian,TransUnion, and Equifax.
Look into a fraud alert
If you’ve been a victim of ID theft, you can obtain an extended free fraud alert for seven years. You’d first need to file Identity Theft Report, which you can create at IdentityTheft.gov — the federal government’s one-stop resource for ID theft victims.
A fraud alert permits creditors to get your credit report, but they must take essential steps to verify your identity.
Don’t get trapped by “free trials”
Free always sounds good, until you forget to cancel a service or don’t realize that you’ve been hit with sky-high fees months later.
Often, you must take the time to cancel before the end of the trial to avoid being charged.
Before accepting a “free” offer, dig deep into the paperwork to see if there are any hidden trial periods, fees or cancellation requirements, according to an alert by the Consumer Financial Protection Bureau.
Search online or contact regulators to see if complaints have been filed against the company, too.