DAYTON, Ohio (WDTN) – Millions of U.S. citizens were affected by the massive 2017 data breach of consumer credit reporting agency Equifax.
The company recently agreed to a global settlement with the Federal Trade Commission, the Consumer Financial Protection Bureau, and each U.S. state for up to $425 million in aid to those impacted by the data breach.
After citizens confirm they were affected by the breach, Equifax will offer a one-time $125 payment or up to 10 years of free credit monitoring and up to $1 million in identity theft insurance.
Credit and data security have been increasing issues for citizens around the country, including the 5 million Equifax users affected just in Ohio.
Financial and legal experts are trying to inform customers on what steps they can take to better secure their information.
“It’s a consequence and the convenience of modern technology that we have,” said legal and financial specialist Richard West. West runs his own law firm in Springboro that focuses on financial and credit issues.
“If you’re going to have online credit information,” said West, “there’s always going to be the possibility that someones going to be able to hack into it. Equifax is a perfect example.”
Equifax is one of the three largest credit companies in the U.S. and even their protections were not enough to prevent the breach.
West said that no credit company of any size would be able to ensure complete protection. He also warned that if a company the size of Equifax is having breach issues, it is safe to assume smaller companies will have those issues as well.
“If Equifax [is having this problem],” said West, “then there are an awful lot of companies out there that have sensitive data that are not as big, don’t have the I.T. budgets, and they’re probably more vulnerable.”
Although there is no protection that can one hundred percent guarantee complete credit protection, West said that there are steps that he encourages every client to take if they are worried about identity protection.
1. “Freezing” your credit remains the safest way to protect your information
If your credit account is frozen, that means no one who is seeking to find out about me to open up a line of credit can get my credit report.
The freeze is a barrier that prevents any person or company inquiring about a person’s credit report will be blocked. They may still be able to use hacked personal information to set up a new account, but that is rare and often not within the capabilities of hackers.
The only drawback for consumers is that they may need a creditor to access their account. If the account is frozen, they will be denied any loan they are seeking.
“What if you’re applying for a car loan and forget,” said West. “You’re gonna have a problem. It’s gonna take a couple days for the freeze to be lifted. So if you’re buying a car, buying a house, applying for a loan, you have to know in advance.”
“It’s not inconvenient if you plan for it properly, but it is the most effective [prevention]” said West.
WEB EXTRA: Legal and financial specialist Richard West gives tips on how to protect yourself. App users click here to watch
2. Putting a Credit Lock on your account is a good middle ground
Putting a lock on your credit is different than applying a freeze. A lock is often controlled via an app that is created by that bank or credit company as a way of monitoring your credit. The lock allows the customer to instantly lock and unlock their credit.
“It’s convenient but it basically is an agreement you have with the credit bureau, it’s not something they are bound to do. If they don’t do it, you have no remedy, but it is convenient and effective.”
“For a middle ground, it’s a good way to go because the third tier [of protection] is less effective.”
3. Credit fraud alerts are helpful but do not work to prevent security breaches
Fraud alerts are alerts sent to consumers that tell them the company believes their has been suspicious activity on their account. In some cases, depending on the company, they may have already taken care of the issue, or they may expect the customer to look into it themselves.
The biggest issue with these types of protection is that they only work after the breach may have already occurred. The protection is designed to look for suspicious activity but is not able to prevent any from happening.
“You might already have the damage done,” said West. “Maybe not, but that’s the problem with one of these alerts.”
4. “Stay aware”
Outside of the variety of protections offered by different companies, specialists like West said the best thing concerned customers can do is to stay aware of what activity is happening in their account at all times.
West said the first step to being aware is actively checking your credit report each month. He said that often customers are not aware of major changes to their scores until long after they have been affected.
Customers also should pay close attention to their monthly bank statements. Often times customers will not read each item on their statement and be unaware that there are strange charges or purchases being made.
“One of the things that you will see before a bit hit,” said West, “is a very small charge. They’re fishing. They’re testing if it works. It may be less than a dollar. I’ve seen this repeatedly.”
Once criminals realize that the card is working and active, they will then go on to make the larger purchases that are typically noticed. Customers who recognize an unknown charge on their statement, even for a small amount, may be able to prevent future theft.