How to Run a Financial Background Check on Yourself

Imagine getting turned down for a job or an apartment rental and having no idea why. You call up the lender or landlord, and they tell you the worst: you failed their credit background check. You’re dumbfounded. You’ve never missed a bill payment and as far as you know, your credit report should be squeaky clean. You immediately request a free copy of your credit report, only to find out there are all sorts of errors — including missed payments on debts you never borrowed and the names of collection agencies you’ve never heard of.

Unfortunately, this scenario isn’t so far-fetched. In 2012, a study from the Federal Trade Commission found that about one in five people had an error on at least one of their consumer credit reports. Sometimes the errors are minor and can be disputed easily. Other cases are much more complicated. In criminal cases of identity theft — if a person has been using your identity to get medical treatment on your tab, for example — you could find yourself facing legal charges on their behalf.

It’s practically impossible to prevent these types of mistakes from happening. To try to stay ahead of errors and potential fraud, it’s good to know how to run your own financial background check. And we’re not just talking about checking your credit reports. There are several important consumer reports that many people may not realize exist — from your medical history report and insurance records to your bank history and tenant records.

Banks, employers, landlords, insurance companies, lenders, utility companies, and other businesses purchase consumer reports to screen applicants. The information in your reports could impact their decision to offer you a loan, employment, or other type of contract. It’s also used to determine the terms of the arrangement, such as the interest rate on a loan or security deposit on a rental.

If you’re worried something on your consumer reports might blow your chances of qualifying for a job, a loan, or even housing, it is possible to check your credit and consumer reports before sending in an application. Catch them early enough and you have you a chance to dispute any mistakes.

Who Can Check Your Consumer Reports?

The Consumer Financial Protection Bureau maintains a list of several dozen consumer reporting agencies along with their contact information. You may recognize the three largest consumer reporting companies, Experian, Equifax, and TransUnion. But there are also specialty agencies that collect, organize, and sell specific types of information about you, such as your history of prescription drug purchases.

While you can always request a copy of your own reports, consumer reporting agencies can only send a copy to another individual or organization under certain circumstance. Your written permission or a court order, along with a valid reason for needing a copy of the report, could satisfy that requirement.

Generally, you’ll be able to request one free copy of each of your consumer reports at least once every 12 months. You also may be entitled to an additional free copy of a report if:

  •  The information within the report is used to make an adverse action against you, such as denying your application or raising your rate. To get a free report due to an adverse action, you must make the request within 60 days of receiving the notice.
  • You place a fraud alert on your credit file after someone stole your identity.
  • You’re unemployed and will look for work in the next 60 days.
  • You’re on public assistance.

When you don’t qualify for a free report, by law consumer reporting companies can only charge a maximum $12 per report that you request.

While you may be able to request a free or inexpensive copy of your consumer reports from a variety of agencies, the process could be time consuming. Although it’ll cost more, it could be worth your time to pay for a background check that includes information from multiple sources.

To conduct a DIY financial background check on yourself, we’ve listed several types of consumer reports you can check and how to go about checking.

Keep in mind, you might not always have a report to review. For example, if you’ve never had a credit line or loan, you might not have a consumer credit report. Or, if you’ve never filed an insurance claim, you might not have one of the specialty insurance reports.

You also might not have a report if there isn’t any recent activity, as information generally drops off reports after seven years.

Credit Reports

You can request a free copy of your credit report from a bureau once every 12 months on There are also companies that give you free access to your Experian, Equifax, or TransUnion reports throughout the year, as well as several paid options that give you access to your reports from all three bureaus.

Your credit reports contain several sections, including identifying information, a record of your payments on credit accounts, credit inquiries, and public records or collections information. Experian, Equifax, and TransUnion are the three largest nationwide credit bureaus, and your credit report from each bureau should be similar, but not necessarily the same.

Checking your credit reports is an important first step because the data on the reports could be used by lenders, landlords, utilities, insurance companies, and employers. Negative marks on your report could lead to you lose an apartment or job opportunity, or result in worse loan terms or higher insurance premiums. The information on your credit reports is also what determines your credit score, which is used for many similar purposes.

Credit reports contain positive information, such as on-time payments, as well as derogatory marks, including past bankruptcies, late payments, and liens. If you find incorrect information on one of your reports, you can file a dispute online or by mail.

Your credit report won’t necessarily come with a credit score, but there are free and paid ways to get a copy of one, or more, of your credit scores.

Check and Bank Account Reports

If you’re having trouble opening a bank account or getting a merchant to accept a check, look for errors or negative information in reports from the following companies.

ChexSystems keeps a database on consumers’ activity with checking and savings accounts. Many banks will pull your report and consider the information when reviewing your application for a new account. Unlike consumer credit reports, your ChexSystems report won’t have positive information. Instead, they only show negative marks, such bounced checks or unpaid fees.

You can request a free copy of your report online, by mail, or by fax, and file disputes online. ChexSystems also scores people based on a 100 to 899 scale based on the information within their report, and you can request a free copy of your score by mail or by fax.

There are also several companies that track consumers’ history with checks and help merchants and payment processors decide whether or not to accept someone’s check. You can request a free copy of your reports from Certegy Check Services, TeleCheck, and Early Warning Services.

Alternative Lending Reports

Some lenders don’t report your history of payments, or lack of payments, to the three nationwide credit bureaus. However, several smaller consumer credit reporting agencies, such as Clarity Services and FactorTrust, collect this “alternative” credit data. Often, the information comes from subprime or alternative lenders, such as payday lenders, rent-to-own retailers, subprime auto lenders, and check-cashing services.

MicroBilt, and its subsidiary PRBC, as well as CoreLogic Teletrack also compile credit reports using alternative lending data and use the information to create consumer credit scores. You can request a copy of your reports from CoreLogic and MicroBilt.

Insurance Reports

Insurance reports could show the types of insurance coverage you have, your claim history, and the resulting losses from a claim. Your report might have information on your driving record or your personal property insurance claims, and that data could impact your ability to get coverage and your premiums.

LexisNexis Risk Solutions offers two C.L.U.E. reports that you can order for free, one for personal property and a second for auto insurance. Insurance Information Exchange also collect information on people’s driving record. However, you can only request a free copy of your report after an adverse action has been taken against you due to information within the report.

Medical History Reports

Life, health, disability, long-term care, and other health-related insurance companies may use specialty medical reports to screen applicants.

MIB, Inc. collects information related to medical conditions and hazardous work environments, with your permission. Milliman IntelliScript creates reports on people’s prescription drug purchases.

Employment Screening Reports

Some companies pull job applicants’ credit reports, but others use more thorough background checks to screen applicants. The reports could have information about your criminal record, driving record, drug or alcohol test results, workers’ compensation claims, and volunteer activity. They could also be used to verify your education, professional accreditations, and previous salaries.

Employers aren’t allowed to pull your consumer credit report without your written permission. When a company requests a consumer report for employment-screening purposes, it won’t receive a credit score with the report.

The Work Number, Sterling Talent Solutions, Pre Employ, HireRight, GIS, and First Advantage all offer employment screening reports and services. You can request a free copy of your report, if it exists, from each company. Knowing what the hiring manager will or won’t see could give you extra time to prepare an explanation of the potentially negative information they find.

Tenant Screening Reports

With your permission, some landlords will look over a copy of your consumer credit report and check it for past late payments, bankruptcies, or other indications that you’ll have trouble paying rent.

Others use a more comprehensive tenant screening service and receive a report that could detail whether or not a person has a criminal record, is on a sex-offender or terrorist list, or has been evicted. Some tenant screening reports also have a record of the person’s rent payments and include a copy of one of their consumer credit reports.

You could request a copy of your reports, such as RealPage, Inc.’s LeasingDesk report or Experian’s RentBureau report, to check it for incorrect information before submitting rental applications.

Additional Reports

There are a variety of other consumer reports you can request and review for errors. For example, the CoreLogic Credco consumer report contains information related to properties you own and could be used by mortgage lenders or brokers. (The same company’s Teletrack report is mentioned above as an alternative lending report.) LexisNexis collects and compiles information on individuals from a variety of proprietary sources and public records.

There’s also SageStream, whose consumer reports are used by mobile phone providers, utilities, and other lenders. The National Consumer Telecom and Utilities Exchange collects information and sells reports about consumers’ telecom and utility accounts and payment history. If you’ve ever had to show a photo identification to make a return at a store, The Retail Equation could add that data point to your profile, and if they suspect fraudulent activity, you might be blacklisted from making returns to some retailers in the future.

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7 FinTech Startups Helping Businesses Fight Fraud

fraud identity theft hacker

Whether it’s a small shop or a multinational company, businesses must constantly have their guard up to protect against fraud. Installing security cameras, verifying dollar bills aren’t counterfeit, and hiring a security guard to prevent shoplifting can all help with physical fraud. But as commerce and banking continue to go online, digital security is critically important as well.

LexisNexis’ 2016 True Cost of Fraud study focuses on U.S. merchants. The study reveals businesses reported an increase in the cost of fraud as a percentage of annual revenue for the third year in a row.

On average, companies have dealt with nearly 650 fraudulent purchase attempts each month, and over 200 of those are successful. Increasingly, fraudulent purchases are coming from remote channels, either from mobile devices or other online methods.

Combating in-person, online, and mobile-transaction fraud can be an exhausting process, and several financial technology (FinTech) companies are working to help businesses outsmart thieves and win the fight.

1. Feedzai

freedzaiFeedzai uses machine learning and big-data analysis to help companies prevent fraud while managing payment processing, opening new customers accounts, underwriting merchant accounts, securing marketplaces, and validating customers.

Feedzai claims its Fraud Prevention That Learns technology, which bases its decisions on historical and real-time behavioral profiling, can detect fraud up to 10 days earlier than the competition, and identify 61% more fraud with lower false alarms.

2. IdentityMind Global

identitymindIdentityMind Global has a platform that payment service providers, online merchants, and financial institutions can use to identify and prevent fraudulent purchases, botnets, phishing attempts, account takeovers, and other types of attacks in real time.

The platform also offers anti-money laundering (AML), know your customer (KYC), and other risk management services to companies, including Bitcoin exchanges and internet lenders.

3. InAuth

inauthInAuth is a risk management and fraud-detection and -prevention platform for the banking, payments, health care, e-commerce, and mobile commerce industries. Large companies can also use it to secure and identify employees’ devices and information.

InAuth’s InExchange service allows businesses from different industries to share positive and negative information about devices, helping companies determine whether or not the device has been linked to fraudulent activity in the past. InAuth also works to identify when devices are infected with malware or crimeware, and whether or not it’s a rooted or jailbroken device, potential signs of fraudulent use.

4. Jumio

jumioAvailable for merchants in the retail, travel, gaming, finance, telecom, and sharing economy industries, Jumio offers digital identification verification, mobile checkout, and form-filling software. Two of its three products can help prevent fraud.

Netverify helps authenticate potential customers by letting them take a picture of their photo ID and use their phone or computer to scan their face. The software verifies that the person matches the photo in the ID. BAM Checkout lets customers make mobile purchases by taking pictures of their credit or debit card and driver’s license. The software compares the names on the ID and card, and can help prevent fraud while creating an easy checkout process for customers. Jumio also has a third service, Fastfill, which allows customers to quickly fill in their information by snapping a picture of an ID card.

While Jumio filed chapter 11 bankruptcy in March 2016 due to some reported financial irregularities within the company, Jumio’s assets were acquired by Centana Growth Partners. Under this new umbrella, Jumio does seem to have steadied itself and raised an additional $15 million from Centana in August 2016.

5. iovation

iovationiovation delivers device-based fraud prevention and authentication services to help prevent mobile and online fraud. The service automatically collects information about a device. This information is used to visit a company’s site and decide whether or not they should allow, deny, or conduct a manual review of a transaction. For example, iovation may notice a device was used to make over $1,200 of purchases in the previous 12 hours, check to see if a phone number is connected to more than three devices, and see if this purchase is coming from a high-risk location.

Using iovation’s fraud prevention service, companies can require suspicious users to go through additional identification protocol or prevent a transaction outright. They can also use iovationScore, a predictive risk score, to help them identify good and bad customers. As a result, they make a checkout experience smoother for good customers, by letting them skip a security check, for example. The scoring system uses real-time machine learning to monitor billions of transactions globally and increase its predictive capabilities.

6. BioCatch

biocatchBioCatch has created cloud-based technology that builds user profiles based on over 500 cognitive parameters, including behavioral patterns. By learning what it looks like when fraudsters create accounts, purchase products, or browse websites, BioCatch can help detect and stop future potential frauds. BioCatch can also help detect when someone takes over a legitimate account by comparing a user’s normal behaviors, including typing speed or cursor movement, to behaviors during the fraudulent session.

7. Trulioo

truliooCanadian startup, Trulioo, uses data from over 140 sources to collect and share information on over 3 billion people, making it one of the largest consumer data companies in the world. E-commerce stores can use Trulioo to verify new customers, reducing the risk of fraudulent purchases and subsequent chargebacks. Financial institutions can use Trulioo’s data to help them meet AML and KYC identity verification requirements.

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6 Things You Should Do Immediately If You Have a Yahoo Account

Sunnyvale, CA, USA - Apr. 23, 2016: Yahoo Inc. Headquarters. Yahoo Inc. is an American multinational technology company that is globally known for its Web portal, search engine Yahoo! Search, and related services.

Yahoo says 500 million user accounts have been compromised, and they are telling users to change their passwords. That’s good advice, and below you’ll find better advice from security firm Sophos.

But first: For the next several days, or even weeks, beware emails that appear to come from Yahoo. Now will be a great time for phishers to trick users into following alleged “change your password” links that actually lead to hacker-controlled sites.

Now, onto the better advice:

  1. Change your Yahoo password immediately.
  2. Reset this password, if you’re reusing it on other online sites. Cybercriminals are now using tools that sniff out passwords reused on other, more valuable sites to make their work easier and to make the stolen passwords and other hacked data more lucrative on the dark web.
  3. Make all new passwords different and difficult to guess – yes, you need to create different passwords for every site you visit.
  4. Include upper and lower case letters, numbers and symbols to make passwords harder to crack – refer to the Sophos Password Quick Tips guide for creating stronger passwords.
  5. Don’t trust password strength meters – these are unreliable and inaccurate.
  6. In general, it’s always good practice to update your passwords, password manager and security questions if you hear of a potential data breach that might affect you. Even data breaches from several years ago could still impact you today.

I disagree about using a new password for every site. I mean, it’s a lovely idea, but it’s just not realistic.  Instead, I’m an advocate of having password families.

One simple password for throwaway accounts you don’t care about, like newsletters;  one medium-hard password for sites that require a registration, but don’t involve money; and then one really strong password for financial accounts that you change on a regular basis.

For that tough password, use something clever, like the first letter of every word in a sentence.  Like this: I Was Born on November 1 in North Dakota — IWBoN1iND (I wasn’t, by the way).  Change a number to a symbol and you are in good shape, like IWBoN!iND.

Now, as for how often you should change your password — I asked a bunch of experts that question not long ago and got some interesting answers.

Graham Cluley – Independent computer security analyst, formerly of Sophos and McAfee (more about him)

I only change my password if I’m worried a service has been hacked/compromised. I have different passwords for each site. In fact, I reckon I have over 750 unique passwords. I use password management software. I think requiring people to regularly change their password is a bad idea. it encourages poor password choices, (such as) ….passwordjan, passwordfeb, etc.


Mikko Hypponen – Chief Research Officer, F-Secure (more about him)

For your corporate network account? Several times a year. For an online newspaper that requires registration in order to read it? Never.  As always, it’s about threat modelling: Figure out which services are the important services FOR YOU. Then use a strong, unique password on those, and change it regularly. For non-important sites: who cares.

James Lyne, Global Head of Security Research at Sophos, speaking specifically about corporation passwords (More about him)

The requirement to change your passwords is a preventive measure that is designed to minimize the risk of your already stolen password being cracked and used. Over 2014 there have been a huge number of attacks which have led to the loss of password hashes (or other representations). These password ‘representations’ require time and effort for attackers to crack and reverse to their plain text form. Depending on the hashing scheme in use and the resources of the attacker this can take little, or a very long time. Changing your password regularly helps manage the risk of an attacker stealing your password hash from the provider (without you knowing) by increasing the probability you have changed it before they use it.

There is a real balance to be struck with password rotations. Some enterprises set painful rotation rules that require staff to regularly learn a new password and commit it to memory – ironically this can lead to staff producing poor passwords to meet the requirement which again ironically makes it much easier for the attacker to break. Providing the service provider does their part and secures your password with an appropriate storage mechanism often using a significantly longer, complex and hard to guess password is a much better defence. Good luck to the cybercriminal going after a 128 character password stored as a (moderately poor) SHA1 hash.

Password managers help you generate long and complex passwords that will be hard to crack even if lost, that said, if you go this far and implement a manager you may as well rotate your passwords once in a while as you don’t need to remember them and it helps minimize the risk of attackers using stolen credentials (particularly on sites that store your password poorly).  Most enterprises would do well to consider how to improve their password storage security and the strength of the original password over a 30 day rotation period.

Harri Hursti – independent security researcher, famous for “The Hursi Hack” of voting machines (more about him)

This is not (an easy question) … because also changing the password too often can become a security risk

It greatly depends. Passwords I use more often, over the internet and are in sensitive sites are changed 2-3 times a year. Then there are very important passwords which are either used very seldom or are used in more secure environment and those I change once a year, or not even then.

Chester Wisniewski and Paul Ducklin, senior security advisors at Sophos. (More about Chester and Paul)

The answer, loosely, is this.

Change a password if any one of these is true:

  1. You suspect (or know) it has been compromised.
  2. You feel like changing it.
  3. You have been re-using passwords and have decided to mend your ways.

We explain better in the podcast “busting password myths,” I think.

The podcast is 15 minutes, however, the first two minutes address this very question and may be worth your time.


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Review: IdentityForce Identity Theft Protection

Pickpocketing at the subway station

About 7% of U.S. residents over the age of 16 were victims of identity theft in 2014, according to a report published in September 2015 by the Bureau of Justice Statistics.

Over half of the victims were able to resolve issues within a day or less. However, victims that took longer to recover their identity were more likely to experience problems with work, relationship stress and emotional distress than those who could fix the problem quickly.

The purpose of services like IdentityForce is to catch identity theft fast so you can resolve issues right away and utilize services such as identity restoration to minimize the hassle of reclaiming your identity from scam artists.

IdentityForce Services at a Glance

The IdentityForce product comes with identity monitoring of public and court records. It also monitors for change of address requests, sex offender listings and payday loans in your name. You’ll get alerted if there’s any unusual activity with your personal information or strange transactions on your credit card or bank accounts.

If your identity is compromised you get one-on-one, 24/7 support from Certified Protection Experts and $1 million in an insurance policy to cover the cost of repairing your identity. This insurance is for the purpose of helping you recover your identity. The $1 million insurance does not cover $1 million in stolen funds.

IdentityForce offers two plans:

The base plan (UltraSecure) has everything discussed above (identity monitoring, alerts, restoration and insurance), but it excludes credit monitoring.

The IdentityForce premium plan (UltraSecure + Credit) gives you the extra benefit of daily 3-bureau credit monitoring along with credit scores and reports from all 3 credit bureaus.

Out of all the service features where IdentityForce shines is the restoration service because technically you can take care of everything else on your own or use a free tool. You can check public records for your own personal information. You can set up alerts with your bank or credit card company to notify you of excess spending or withdrawals.

You can also use a site like Credit Karma to monitor your credit reports for unusual activity and set alerts if there are changes to your accounts.

But, what’s more challenging to do by yourself is taking care of the problems that arise after your identity is stolen. If you sign over power of attorney to IdentityForce when your identity is stolen a specialist will make all the calls on your behalf to recover your identity.

Child Watch and Medical Identity Theft Protection

IdentityForce offers Child Watch and Medical Identity Theft Protection as service add-ons.

Once you subscribe you can add your children to the Child Watch program. This extra feature will notify you if there’s suspicious activity under your child’s name. Child Watch is also included in the $1 million insurance policy and restoration service.

Medical identity fraud happens when someone uses your insurance and personal information to get medical care without paying. Then medical bills you’re completely unaware of show up on your delinquent accounts and impact your credit. IdentityForce will monitor your medical accounts and medical insurance to stay on top of fraud.

IdentityForce Transparency Level

Overall the IdentityForce service is transparent with its terms and how the service works. In small print on the Family Identity Theft Protection page, IdentityForce mentions no one (or service in this case) can prevent all identity theft. It’s true.

If you purchase a service like this the purpose is to catch identity theft early so you can nip it in the bud. You can’t eliminate your chances of experiencing fraud entirely.

IdentityForce is also transparent about what the insurance policy does and doesn’t cover. This is a plus because you don’t want to sign up for a service and then get an unpleasant surprise when you need to submit a claim.

In a nutshell, the insurance will cover the costs of reinstating your identity if you’re found to be a confirmed victim of identity theft. According to the terms, getting a purse, wallet or sensitive documents stolen does not automatically mean you’re a confirmed victim.

After money is stolen from your bank account or other fraud activity occurs, you’re then considered a confirmed victim and qualified for coverage. The insurance plan covers reasonable and necessary costs like long-distance calls, loan re-application fees and the cost of up to 6 credit reports while resolving identity theft.

You’ll also get coverage for lost wages if you have to take off from work. Another benefit of insurance coverage is it’ll cover legal and defense fees for charges brought against you as a result of identity theft if you choose an attorney that’s approved by IdentityForce.

The Cost of IdentityForce

The UltraSecure Plan costs $17.95 per month or $179.50 per year: This is the basic plan including monitoring of public records and activity alerts. Also comes with restoration services and the $1 million insurance policy.

The UltraSecure+ Credit Plan costs $23.95 per month or $239.50 per year: This plan includes everything from the UltraSecure Plan plus daily credit monitoring. You’ll get credit reports and scores from all 3 credit bureaus. There’s a monthly score tracker and a credit score simulator.

Other Identity Theft Protection Alternatives

Zander is another identity protection service that offers similar features as IdentityForce without the credit monitoring aspect although you get free credit reports.

Identity monitoring, fraud alerts and identity restoration is included in the service. You’ll also get reimbursed up to $1 million of expenses caused by identity theft. Zander is $6.75 per month for individuals (or $75 per year) and $12.90 per month for families (or $145 per year).

TrustedID offers 3-bureau credit monitoring, credit reports and credit scores. It has fraud alerts, medical benefits protections, protection support specialists and $1 million of identity theft insurance. The plan for individuals costs $14.17 per month billed in one installment of $170 per year. For families it costs $25 per month billed in one installment of $300 per year.

Is IdentityForce Worth the Cost?

Comparing costs of IdentityForce against both Zander and TrustedID, IdentityForce is slightly more expensive.

If you were to pick between Zander and IdentityForce (since both offer restoration services), Zander gives you a comparable service for less money. And you can always solve the problem of Zander not having credit monitoring by coupling it with another free service (i.e. Credit Karma).

Ultimately, before checking out any identity protection product you should think about whether you can do monitoring on your own and avoid the cost entirely. For pros and cons of using an identity theft protection service check out this post.

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Your Identity Portfolio Can Make or Break You

identity portfolio

No matter how good or lucky the investor, no one beats the market 100% of the time—unless, of course, you are Bobby Axelrod. There is, however, an investment portfolio that is somewhat more predictable. It works along similar lines, but it is possible to exercise significantly more control over it than equities. I’m talking about your identity portfolio.

I’ve written elsewhere about your credit portfolio, which can be a wealth-builder or a weapon of individual destruction depending upon how much time and effort you invest in building, nurturing, managing and protecting it.

Most people know that having bad or good credit can mean the difference between buying a bigger, better home, getting a low monthly payment on a new car, and even whether or not you get a job. No doubt that last fact comes as a surprise for many, but it is a real issue — even though a growing number of states limit utilization of credit reports as part of a job interview, many employers will, with permission, review an applicant’s credit history in order to evaluate his or her trustworthiness and employability.

Your identity portfolio is arguably more important than your credit portfolio, because if it takes a hit — and at some point in your life it most likely will — so does your credit for at least as long as it takes to sort things out with whatever agencies and institutions are involved in the particular way you were defrauded.

Ask anyone who has experienced an attack on their identity — and with that their credit-worthiness — when they were, for example, in the middle of making a major purchase like a home or car: Identity-related crimes are a game-changer and the fallout can be pretty dire.

What’s in a Name?

I’ll leave the poetry to Shakespeare, but when it comes to your identity portfolio, your name and the cloud of facts that tie that name specifically to you is pretty much the whole enchilada. All of our material facts and assets are tied to a name — your credit accounts, your phone, your social media, your home, your car, your debt.

With an endless parade of major data wipeouts in our wake, Social Security numbers — the skeleton key to our lives — can be purchased on the information black market by the bushel. It is a bad bet to assume your Social Security number isn’t already “out there.” Indeed, a major reason why more folks haven’t yet become victims of identity-related crimes is because there simply aren’t enough scam artists in the world to make bank on all the information that has been hijacked from tens of thousands of databases — not to mention that which is willingly flung out there daily on social networking sites.

The big difference between your stock portfolio and your identity portfolio, however, is that you really do have some control with your data. While there is no way to stop a scam artist from targeting you, the goal is to own your name, and, as much as possible, to safeguard it, making sure no one else ever does.

You’re Going to Get Got

Unfortunately, that’s much easier said than done. With more than 1 billion records already exposed through mega breaches and daily security lapses to those who view the theft of our identities as their day job, there’s just no telling who has access to the kinds of information that tie your name to your waking reality, and if the wrong person gets a hold of the keys to “you,” you’re in harm’s way.

But there is good news: You can take proactive measures to minimize your exposure.

For starters, there are the Three Ms, which I describe in detail in my book, Swiped: How to Protect Yourself in a World Full of Scammers, Phishers, and Identity Thieves. The short version of them:

  • Minimize your exposure. Don’t authenticate yourself to anyone unless you are in control of the interaction, don’t over-share on social media, be a good steward of your passwords, safeguard any documents that can be used to hijack your identity, and consider freezing your credit.
  • Monitor your accounts. Check your credit report religiously, keep track of your credit score, review major accounts daily if possible. (You can check two of your credit scores for free every month on If you prefer a more laid back approach, sign up for free transaction alerts from financial services institutions and credit card companies, or purchase a sophisticated credit and identity monitoring program,
  • Manage the damage. Make sure you get on top of any incursion into your identity quickly and/or enroll in a program where professionals help you navigate and resolve identity compromises—oftentimes available for free, or at minimal cost, through insurance companies, financial services institutions and HR departments.

Protect Your Kids’ Identity Portfolios Too

Not everyone can start an investment portfolio for their kids — whether it takes the form of money socked away for a rainy day, stocks and bonds to help defray the cost of college or long-term strategies aimed at accruing the down payment on a house. None of that will be possible, sometimes for years, if your child becomes the victim of identity theft as a minor.

The problem is exacerbated by the fact that most people don’t think about checking their children’s credit. It should be blank. If it isn’t, you need to resolve the matter expeditiously. The three Ms are a crucial investment in your children’s futures — or rather the first and second ones are: Minimize exposure (don’t post pictures of passports and Social Security cards, geo-tagged pictures, or anything else that could be used to gather enough information for a scam) and monitor accounts (check your child’s credit annually or find out how to create a credit file and suppress it — where permitted by law — until they are old enough to legally apply for credit).

Kill Your Data

Because there are so many ways people unwittingly (phishing) or willingly (social networking) leak information, your job is to make as much of it disappear as possible.

Some examples of places your information can be found: The cache of your computer; your hard drive (even after you erase it), deactivated social media accounts (and of course active ones with loose privacy settings), your browser history. If someone gets into your computer, they can put together a very detailed account of who you are based upon the sites you visit, the purchases you’ve made, the Internet searches you’ve conducted (think about how much about your life is discernable from the things you Google), the amount of time you spend online and the folks with whom you keep in touch.

If you keep your phone’s location tracker on, you’re potentially providing a stalker, a scammer, a burglar or an identity thief with a whole lot of information: where you go, where you live, even who sleeps next to you. If you allow geo-tagging on your photos, there is still more information to be had.

All this data about you serves a business purpose. It helps companies better understand how to sell you products and services. Arguably, it can make your life more convenient. But the trade-off is vulnerability. By helping third parties better understand who you are, you‘re also placing yourself in a position to be hurt if, for example, one of those third parties gets hacked.

Think it won’t happen to you? So did tens of thousands of organizations like Anthem, Neiman Marcus, Community Health Services, the Houston Astros, the U.S. Office of Personnel Management and the Internal Revenue Service.

No one is beyond the reach of hackers. Your best bet is to assume that you are going to get got, and keep things as tidy as possible. Don’t make it easy to turn yourself into an identity crime statistic. Invest in your identity profile with vigilance and common sense, and it will go a long way towards getting you where you want to go, without any unnecessary impediments. Leave it to fate, and…

More on Identity Theft:

Image: Creatas

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How Much a Credit Freeze Costs You by State

Credit score large

Are you going through an identity crisis? Not the kind we all experience in high school when we went back and forth from wearing preppy polos to wearing studded jackets. No, this type of identity crisis is more serious, and it has its roots in identity theft. When someone steals your identity, you’re vulnerable in a myriad of ways. Thieves may steal money using your debit card information, or take out a mortgage in your name. They have the potential to ruin your finances, and therefore your life.

If you do find yourself a victim, you may want to put a freeze on your credit report. That way, when thieves go to open a new account in your name, the lending institution will not be able pull your report. When they can’t pull the report, they will not be able to extend credit.

Here are some situations where placing a freeze on your credit report may make sense:

  • Someone stole your identity and applied for new credit.
  • Someone stole your credit or debit card information. You will know this is the case because their shopping trips will show up on your statements, or your financial institution may get in touch with you about suspicious activity. A credit freeze won’t stop them from spending more with your current information, but it will stop them from opening new accounts.
  • Someone is using your identity to rack up medical bills. This means they have your Social Security number, and a credit freeze will prevent them from taking out new credit with lending institutions. It will not, however, prevent them from continuing to commit medical identity theft.
  • You go to file your taxes, and are informed your return has already been filed. In this case, you are likely the victim of tax fraud, and the thief has your Social Security number. Much like medical identity theft, a credit freeze will not prevent thieves from committing tax fraud in the future, but it will keep them from opening additional lines of credit in your name.

[Credit Freeze: A Defense Against Identity Theft]

Having your identity stolen is inconvenient to say the least, especially if it’s happening when you are planning to make a large purchase. Because your credit report is frozen, you won’t be able to apply for new credit yourself. In these instances, you can temporarily remove the freeze.

When you’re satisfied that your identity is no longer at immediate risk, you can permanently remove the freeze.

That’s not to say that the process is free. Each action comes with a different fee for every state. You must pay these fees three times, or once per each credit bureau. Most states waive all fees if you are the victim of identity theft, but you must be able to prove it with sufficient documentation at the time that you place your credit freeze.

[Worth It Or Not? Identity Theft Reviewed]

Here are the fees and exceptions for placing a credit freeze on an adult’s credit report for all 50 states, plus Washington, D.C., and Puerto Rico:

Alabama, Kentucky, Michigan, Mississippi, New Hampshire, Oregon, Utah, Wisconsin, and Wyoming

The above nine states charge a $10 fee for each of the following actions: placing a freeze, temporarily removing it, and permanently removing it. The fee is waived in each instance if you were the victim of identity theft.


Alaska charges a $5 fee to place a freeze on your credit report. It charges a $2 fee to temporarily remove the freeze, but it charges nothing for the freeze’s permanent removal. All fees are waived if you were the victim of identity theft.

Arizona, Kansas, Maryland, Minnesota and Ohio

All five of the above states charge a $5 fee for placing a freeze, temporary removal, and permanent removal. The fees are waived if you were a victim of identity theft.


Arkansas charges $5 for placing a freeze on your credit report, temporarily removing it, and permanently removing it. All fees are waived if you are age 65 or older, or if you are the victim of identity theft.


California’s fee for placing a credit freeze is $10. This fee is waived if you are 65 years of age or older. There is a $10 fee for both temporary and permanent removal of the freeze, and both of these fees are reduced to $5 for those 65+ years old. All fees are waived for victims of identity theft.

Colorado, New Jersey, and New York

Colorado has no fee associated with placing a credit freeze, though victims of identity theft must still provide supporting documentation of their case. That is because when you go to have the freeze temporarily or permanently removed, you will be hit with a $10 fee in each instance if you are not a victim of identity theft.

New Jersey, and New York follow a nearly identical procedure, though the removal fees for those who are not victims of identity theft are $5 each in New Jersey, and $5.44 in New York in contrast to Colorado’s $10.


The state of Connecticut charges $10.64 each for placing a credit freeze, temporarily removing it, and permanently removing it. All fees are waived for victims of identity theft.


Delaware charges $10 for placing a freeze, or $5 if you are 65 years of age or older. The fee is waived if you are the victim of identity theft. There are no fees for anyone for temporary, or permanent removal of a credit freeze.


Florida charges $10 for each of the following actions: placing a credit freeze, temporarily removing it, and permanently removing it. All fees are waived for victims of identity theft, and residents age 65 or older.


Georgia charges $3 each for placing a credit freeze, temporarily removing the freeze, and permanently removing it. All fees are waived for those 65 or older, and victims of identity theft.


Hawaii’s fees for placing a credit freeze, temporarily removing it, and permanently removing it are $5.20 per each action. This fee is waived for victims of identity theft only for temporary or permanent removals; everyone has to pay the initial $5.20 fee to place the freeze in the first place.


Idaho charges $6 for placing a freeze, and another $6 fee for temporarily removing it. Victims of identity theft are exempt from both of these fees. No one has to pay anything to have a freeze permanently removed from their credit report in this state.

Illinois, Nevada, and Rhode Island

Illinois, Nevada, and Rhode Island charge $10 each for placing a freeze, temporarily removing it, and permanently removing it. Residents age 65 and older are exempt from the $10 fee when placing a freeze, but remain subject to all removal fees. Victims of identity theft are exempt from all fees.

Indiana, Maine & South Carolina

There are no fees of any kind associated with credit freezes for adult residents of the states of Indiana, Maine, and South Carolina.


Iowa charges a $10 fee for placing a credit freeze, though victims of identity theft are exempt. Victims are also not charged the $12 temporary removal fee, though they are subject to the state’s $10 fee for permanent removal of their credit freeze.


Louisiana charges $10 for placing a freeze, though residents age 62 and older, and victims of identity theft are exempt from this specific charge. Victims of identity thefts are also exempt from the $8 fee for temporarily removing the freeze. There are no fees for any Louisiana residents for permanently removing a freeze from their credit report.


Massachusetts’s fees are $5 each for placing a freeze, temporarily removing a freeze, and permanently removing it. Victims of identity theft and their spouses are exempt from all fees.

Missouri & North Dakota

Missouri, and North Dakota charge $5 in fees for both placing a credit freeze, and temporarily removing it. Victims of identity theft do not have to pay either of these fees. Missouri and North Dakota residents, regardless of their victim status, do not have to pay anything to have a freeze permanently removed.


The state of Montana has instituted a $3 fee for placing a credit freeze, and for having that freeze temporarily removed. Victims of identity theft are exempt from both fees. Montana residents do not have to pay any fees associated with permanent removal of a credit freeze.


Nebraska charges a $3 fee for each of the following actions: placing a freeze, temporarily removing a freeze, and permanently removing it. Victims of identity theft are exempt from all fees. In addition, Nebraska considers you a minor if you are under the age of 19. If you are under 19, and find yourself the victim of identity theft, your fees will be waived, but you will have to have a guardian file for you.

New Mexico

New Mexico charges $10.50 for placing a credit freeze. Residents age 65 and older, and victims of identity theft are exempt from this fee. Temporarily removing the freeze, and permanently removing it will incur a charge of $5.25. Victims are exempt from all removal fees, as well.

North Carolina

The only fee North Carolina charges is $5 for each of the following actions for a protected consumer in your care between the ages of 16-62: placing a freeze, temporarily removing it, and permanently removing it. In any other circumstance, North Carolina residents are not charged any fees.


Pennsylvania residents are charged $10.70 for placing a credit freeze unless they are victims of identity theft, or age 65 or older. There is another $10.70 fee for placing a temporary removal on your freeze. This fee is waived only for victims of identity theft. Pennsylvania residents, regardless of age, or victim status, are not charged any fees associated for the permanent removal of a credit freeze.

Puerto Rico

Puerto Rico charges $10.70 in fees for each of the following actions: placing a credit freeze, temporarily removing a freeze, and permanently removing it. All fees are waived if you are a victim of identity theft.

South Dakota

South Dakota’s fee of $10.60 applies to each of the following actions: placing a freeze, temporarily removing it, and permanently removing it. All fees are waived for victims of identity theft.


Tennessee charges $7.50 for placing a credit freeze. While there are no fees associated with temporary removals, there is a $5 fee for permanently removing the freeze from your credit report. Both fees are waived for victims of identity theft.


Texas charges $10.83 for placing a freeze on your credit report. This fee is the only one victims of identity theft are exempt from. There is also a $10.83 fee for both temporarily, and permanently removing the freeze. All Texas residents are subject to removal fees, regardless of victim status.


Vermont charges $10 for placing a freeze, and $5 each for temporary, and permanent removal of the freeze on your credit report. Victims of identity theft are exempt from all fees.

Virginia & Washington, D.C.

The District of Columbia, and Virginia both charge a $10 fee for placing a credit freeze, though it is waived for victims of identity theft. There are no fees associated with temporary, or permanent removal of the freeze.

Washington (State)

The state of Washington charges $10.95 each for placing, temporarily removing, and permanently removing a freeze on your credit report. Residents age 65 and older do not have to pay the placement fee, but are subject to all removal fees. All fees are waived for victims of identity theft.

West Virginia

West Virginia charges $5.30 for each of the following actions: placing a credit freeze, temporarily removing said freeze, and permanently removing it. Victims of identity theft are exempt from all fees.

The post How Much a Credit Freeze Costs You by State appeared first on MagnifyMoney.

Review: MetLife Identity Theft Protection

Pickpocketing at the subway station

Instances of identity theft are trending upward. From 2012 to 2014, the number of U.S. residents that experienced identity theft increased by 1 million. So, its no wonder identity protection products are becoming more and more popular.

MetLife offers identity theft protection at no cost for customers that have MetLife auto, home or renters insurance coverage. The product is broken down into two parts, identity protection and restoration. Identity protection is in place to help prevent theft while restoration helps you recover from theft if it happens.

At one point, MetLife also offered an identity monitoring product called MetLife Defender. However, at this time, it looks like MetLife is no longer accepting new enrollment for it.

So, let’s discuss the identity protection services for MetLife customers.

[Worth It or Not? Identity Theft Protection Reviewed]

How MetLife Identity Protection Works

MetLife provides a suite of specific services to help keep your identity protected in certain situations. If you’re active-duty military, MetLife will put an alert on your credit report for a year while you’re abroad. You can also extend the alert if necessary. The purpose of it is to safeguard you from identity theft while you’re away.

Another facet of the service is travel protection. Adventures in foreign places are fun, but tourists are also easy targets for scams and theft. If any of your personal items like your passport or credit card are stolen or lost during a trip, you can contact a fraud specialist at MetLife who will help you cancel or replace them.

Children are just as susceptible to identity theft as adults. If your child’s identity is misused, a MetLife fraud specialist can submit a credit suspension in your child’s name.

Other than stealing information to get ahold of your funds, identity theft for medical care is common. If your identity is used to get medical services and medications, MetLife will help you contact your service providers and insurance to clean up your records. This is important for your own safety. If you need medical care, you don’t want someone else’s medical history popping up. And, of course, you don’t want to get stuck with another patient’s medical bills.

MetLife will also help you through relocation paperwork such as switching over your mailing address and handling mail forwarding. There’s a lot of moving parts when you relocate, so assistance in this area for free is something MetLife customers can appreciate.

Finally, if a loved one passes away, MetLife will help you to go through the final details of closing accounts and pursuing death benefits.

The MetLife Identity Theft Restoration Service

What stands out in this free product is the identity theft restoration service because technically you can do all of the above on your own. However, recovering your identity after it’s stolen is challenging.

If your identity is compromised, MetLife fraud specialists will help you file police reports. They’ll also assist you in reporting theft to credit bureaus. Plus, MetLife will give you a year of free credit and fraud monitoring along with complimentary credit reports from each credit bureau. Not a bad deal.

If you think your identity has been stolen, MetLife instructs customers to call the auto and home insurance line. From there, you’ll get connected with a fraud specialist.

Transparency Levels

There’s no way to completely prevent identity theft in this digital age. A company that promises you otherwise is being too optimistic. Find out more about how to decide if you should trust an identity theft protection company in our guide.

MetLife does make it pretty clear that the service is intended to provide you solutions to help you avoid identity theft and restore your accounts if you notice suspicious activity. It does not guarantee to prevent an assault on your identity altogether.

Other Identity Theft Alternatives

If you don’t have auto or home insurance with MetLife, here are a few other options for identity protection:


Zander has two plans. Both include $1 million in reimbursement for charges incurred while recovering your identity. It also comes with personal information monitoring, unlimited recovery services, child information scans, one-on-one support and more.

The $1 million reimbursement benefit covers costs like lost income, legal fees and other expenses necessary to repair identity theft like replacing documents or getting credit reports. Here’s the cost of both plans:

  • Individual Plan – $75 per year or $6.75 per month
  • Family Plan – $145 per year or $12.90 per month

To clarify, the lost income doesn’t cover money stolen from you by thieves, but the lost wages incurred by needing to make court appearances or other errands related to cleaning up your identity.

Read more about Zander here.

Identity Force

Identity Force offers monitoring and restoration services with two tiers as well. Both packages include monitoring your personal information in public records. There’s also alerts for bank or credit card activity that’s out of the ordinary so you can catch it before too much damage happens. Here’s the cost of both plans:

  • UltraSecure – $179.50 per year or $17.95 per month
  • UltraSecure+Credit – $239.50 per year or $23.95 per month

The difference between the premium and basic plan is the UltraSecure+Credit package includes daily credit report monitoring from 3-bureaus and monthly credit score tracking.

MetLife Customers Can’t Beat Free

The best defense for identity theft is staying aware and taking swift action if you notice anything suspicious. If you’re a customer of MetLife and qualify for this product it make sense to use it.

Keep in mind, MetLife doesn’t offer credit monitoring and reports unless your identity is compromised. If you’re a MetLife customer looking for ongoing credit monitoring, you can sign up for free sites like Credit Karma and Credit Sesame to get alerts every time there’s a change to your score or report. You can also get your free credit report once a year at



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Review: AARP Identity Theft Protection

Pickpocketing at the subway station

AARP offers Identity Theft Protection through TrustedID. There are benefits and pricing exclusive to AARP members that make getting protection through AARP a better choice. To be clear, you must be an AARP member if you want to sign up for its identity theft protection service. Let’s see how it stacks up.

Overview of AARP’s Identity Theft Protection Service

The identity theft features provided by TrustedID through AARP include the monitoring of your credit, alerts from all three bureaus, and having your Social Security number, public records, and medical benefits monitored. TrustedID also has a “Lost Wallet” feature that allows you to store the information you keep in your wallet so you have access to it in case your wallet is stolen.

AARP members get special access to tax identity protection, change of address monitoring, and monthly credit score tracking. Other services include black market surveillance, fraud alert reminder service, and a $1 million identity theft insurance.

Medical benefits protection is a unique service offered by TrustedID. A representative can help you request your medical benefit statement so you can make sure no one else is taking advantage of your benefits to receive treatment.

You can also set up fraud alert with TrustedID so whenever a new account is opened in your name, lenders must verify that it’s you before approving the account. TrustedID will also remind you to renew this fraud alert with the bureaus every 90 days.

TrustedID can help remove your name from mailing lists so the amount of junk mail you receive is lessened. This can be a big concern for those 50 and older, and reduces the chance you might fall for a scam.

All of this is great, but what about identity restoration, arguably the biggest benefit offered by other identity theft protection services? It’s not mentioned on the website, so we asked a representative, and AARP had this to say: “In the unlikely event that your identity is ever compromised while you’re with us, call us immediately and an identity protection specialist will discuss with you the steps to restore your identity. Obviously there are things we can’t do for you because we’re not you, like showing up in court or contacting your bank to cancel credit cards. But we will manage everything else and be there to help every step of the way.”

The short answer seems to be that complete identity restoration services are not available through TrustedID, but protection specialists are available from 5AM – midnight PST in case you need assistance.

Identity Theft Insurance

The details of the $1 million identity theft insurance policy are located on Equifax’s website here. If, at first glance, you think the identity theft insurance policy is meant to cover you from losses, you should know that’s not entirely true.

The actual purpose of the insurance policy is to protect you from any costs incurred as a direct result of having your identity compromised. For example, if you have to take time off of work to go to court or replace important documents, the insurance policy will typically reimburse those costs. It also covers the cost of an attorney should you need one.

A complete breakdown of the insurance policy is in a PDF format here. As you can see, it covers costs such as lost wages, travel expenses, childcare, elder care, and legal consultation. It will also cover funds lost due to unauthorized electronic fund transfers, but typically not up to $1 million. The $1 million simply means TrustedID will spend up to a total of $1 million to restore your identity. Each category usually has a spending limit.

Additionally, you must report your identity as stolen to receive the benefit from the insurance. This policy can come in handy in case your identity is severely compromised, to the point where creditors come after you in court (for accounts you didn’t open), or someone gets a hold of your tax refund before you do.

How AARP’s Identity Theft Protection Service Works

You can sign up for a membership online in four steps:

  1. Choose which plan you want
  2. Fill out personal information to create an account
  3. Verify your identity is correct (you’re required to enter your Social Security number in the second step)
  4. Access the platform

Once you sign up, you’ll receive an “Identity Threat Score” that allows you to see if your identity is currently at risk. This serves as a good starting point.

The details of how alerts work isn’t stated on AARP’s website, but there is a “chat” function and phone number at the top in case you have questions. We asked a representative who told us alerts are sent via email and text.

Alerts will be received in the event of:

  • A new or closed accounts
  • New credit inquiries
  • The discovery of any negative information

[Getting back thousands of dollars after bank fraud]

How Much Does AARP’s Identity Theft Protection Service Cost?

There are two plans offered: an individual plan, and a family plan. Free 14-day trials are available for both in case you’d like to try the service before subscribing. Credit card information is needed to sign up, so you must cancel before the 14 days are up to avoid being charged.

Monthly and annual plans are also available for both.

The monthly individual plan is $16.99, or you can choose the annual individual plan for $170, a 17 percent savings ($14.17 per month). Under the annual plan, you can cancel whenever you want, and you will be refunded for any unused months. You can cancel at any time on the monthly plan as well, but be aware that for both plans, partial refunds aren’t given, so cancel as close to your renewal date as possible.

The monthly family plan is $29.99 per month, and the annual family plan is $300 (which is $25 per month). The family plan is good for four individuals in your household – up to two adults, and two children or grandchildren under the age of 25.

Again, you can cancel at any time and receive a refund for unused months under the annual plan, and partial refunds aren’t given. With the family plan, you can enroll additional children or grandchildren for an extra $5 per year.

AARP claims to have exclusive pricing. During the initial review of this service, prices were listed at lower amounts (the monthly individual plan was $12.99 per month). However, it looks like pricing is currently identical to TrustedID’s normal pricing.

[Worth it or not? Identity theft protection reviewed]

Transparency Level

At first glance, it may seem like AARP is teaming up with TrustedID to provide identity theft protection services to its members, but it’s using the TrustedID platform completely.

On the bottom of the site is a disclosure: “AARP® Identity Theft Protection from TrustedID is provided by TrustedID, not AARP or its affiliates…AARP does not employ or endorse TrustedID associates.”

As a result, there isn’t much information on the AARP site about the services offered at all. Quite a few times it tells users to check out TrustedID’s website instead. It would be easier if all the information was in one spot. For example, there’s no information on how alerts work or what the $1 million identity theft insurance covers on AARP’s website.

While this service provides credit reports, it also says that anyone has the right to obtain free credit reports at It also makes it clear that the credit reports provided are in addition to these three.

Lastly, TrustedID is an Equifax company, and any credit scores provided by it are based on the Equifax scoring model.

Alternative Identity Theft Protection Services

If you’re looking to monitor your medical benefits and want to enjoy the other services offered by TrustedID through AARP, that’s great, but it likely isn’t worth paying such a high amount. In the event your identity is stolen, especially if you’re over 50, you want a company with representatives who will completely assist you in restoring your identity.

Zander Insurance is the cheapest option at $6.75 per month for individuals, and $12.90 per month for families. While it doesn’t offer credit-monitoring services (you can sign up for free credit monitoring at Credit Karma or Credit Sesame), it does offer the total identity restoration. A representative will be assigned to your case, and they will file paperwork for you and call companies on your behalf to get your identity back to its original state. Alerts are sent via email and you can also access your information on its web portal, perfect for those who are older and not as internet-savvy.

If you happen to enjoy technology, then BillGuard is another excellent alternative to look into. It’s a mobile app available for Android and iOS, and for $9.99 per month, you get complete access to its identity restoration service. You can also monitor your spending and credit directly from the app. As you might guess, alerts are received via the app as well as via email.


TrustedID through AARP might be a good solution for seniors, but it’s not a comprehensive solution. Yes, seniors are more at risk of identity fraud, but they also might need more assistance to restore their identity in the event it’s stolen. Zander Insurance provides a less expensive alternative with more services. Besides, if you’re not already a member of AARP, you’ll need to register to get access to TrustedID. Zander and BillGuard are stand-alone services.

The post Review: AARP Identity Theft Protection appeared first on MagnifyMoney.

Are Chip-Enabled Credit and Debit Cards Really Any Better?

Pickpocketing at the subway station

New chip-enabled credit cards are upon us, but not all cardholders are jumping on the bandwagon right away. In fact, only about one in five consumers has used an EMV credit card so far, according to a survey from point-of-sale company HarborTouch.

One in five adults also names transaction time as a top concern when it comes to these cards. A full 67% of consumers believe traditional swipe cards are quicker, according to the data. “On average, it takes between seven to 10 seconds to pay using a chip card versus two to three seconds to pay using a traditional swipe card,” Jared Isaacman, founder and CEO of HarborTouch, said in the release. “While seemingly small, during busy times like the holidays, these increased processing times could add up quickly.”

“But chip cards aren’t about speed,” we can hear you saying. They’re meant to address security concerns, right? The truth is cardholders aren’t buying it — almost four times as many survey respondents are more worried about speedy processing over chip card security, according to HarborTouch’s findings.

Plus, the way the U.S. is approaching chip cards might not actually be as secure as you’d think. In the United States, banks have overwhelmingly adopted chip-and-signature cards, which require only a signature to make a purchase. The more secure chip-and-PIN format — more common overseas — requires a PIN at each transaction, foiling most card counterfeiters and thieves.

Chip cards also do nothing to thwart online fraud, even though 77% of credit and debit card owners who have received a chip card believe it will, according to a survey from CA Technologies. In fact, since chip cards’ security features mainly address in-person purchases, many experts believe there may be an uptick in online thievery.

Just ask Jennifer Watts, whose updated chip-enabled debit card was hacked almost immediately. “I had this brand new card with this new chip on it that they told me would keep me safe from fraud and hackers, and criminals still stole the card numbers,” says Watts, 48, who lives in Myrtle Beach, SC. “There was fishy activity on it somewhere in Colorado.”

This was after she’d gotten a chip card because she had a hard time checking into a hotel in North Carolina on a recent trip. “There was no way they would book me into the hotel without me having a card with a chip on it,” she says. “I was stranded.”

Watts was able to get her money back from her bank after she reported the fraud, but she’s not sold on EMV cards in general. “Even though they tell you that it’s going to keep from having money stolen out of your account, it’s just not true,” she says. “Ultimately this chip has caused me nothing but problems.”

MagnifyMoney’s Action Plan

The chip card doesn’t make you any more likely to experience fraud, but there are some habits you can use to minimize your risk of getting hit by thieves.

  • Stop using your debit card unless you’re using an ATM in a physical bank branch: Debit card fraud means the thieves are actually taking money out of your account instead of making credit card charges. You could also be on the hook for some (or all) of the stolen money with debit card fraud. Credit cards provide much better liability protection. Learn more here.
  • Cover your hand when typing in a debit card PIN: Hackers are getting incredibly clever. So clever, that some will place a skimmer on an ATM and a camera to record your pin number. Outsmart them by simply covering your hand when you type in your pin, which will make it harder for them to gain access to your bank account.
  • Be proactive about identity theft: Don’t wait around if you think there is a possibility your identity has been compromised. Pull your credit reports to look for strange activity and then place a credit freeze. Then monitor your credit cards and bank accounts for any unfamiliar charges. Find an identity theft action plan here.

The post Are Chip-Enabled Credit and Debit Cards Really Any Better? appeared first on MagnifyMoney.