Free alternative to credit monitoring for AT&T data-breach victims

Free alternative to credit monitoring for AT&T data-breach victims

Credit monitoring, credit freezes and fraud alerts. What is the difference between these? AT&T customers affected by a data breach that allowed customer information onto the dark web may be wondering. -AFP via Getty Images

AT&T is offering to pay for credit monitoring for some of its customers following a data breach who leaked information about millions of the company’s current and former customers on the dark web.

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Of course, credit monitoring is a way for people to keep tabs on their credit score and try to combat identity theft, experts say.

But a credit freeze is an even more effective way to fend off scammers and criminals before they can even try to take advantage of a consumer’s name and information, these experts added.

Along with credit monitoring or credit freezes, customers affected by a data breach can also sign up to receive fraud alerts. But one option is more effective than the others.

“In order of effectiveness, credit freezes are certainly at the top of the list,” said John Ulzheimer, a credit expert who previously worked at Equifax EQX and FICO FICO. “With a freeze, no new creditors will be able to access your credit reports. This stops any attempt to apply for credit.”

Some say freezing credit should be the consumer’s default position. “The reality of living in 2024 is that your information is going to be stolen, so you need to act accordingly,” said John Dwyer, director of security research at Binary Defense, which works with businesses to defend them against cyberattacks.

“I recommend that everyone keep their credit frozen at all times,” Dwyer said. That’s what he’s been doing since 2013. He briefly unfroze his credit report while he was buying a car and a house, then refroze it.

He added: “It’s not an everyday occurrence that you need to access your credit report. »

After revealing the data breach, AT&T T said it would send emails or postal mail to customers with “compromised sensitive personal information” to offer them free identity theft and credit monitoring services.

The data discovered included Social Security numbers, street addresses, email addresses and dates of birth of AT&T customers, according to the telecommunications company.

The mountain of affected customers includes 7.6 million current customers and 65.4 million former customers. The data appears to be from 2019 or earlier.

Read also: AT&T customers say $5 credit for massive cell phone outage is ‘a joke.’ But the law says we owe them nothing.

AT&T did not respond to MarketWatch’s request for comment. Its disclosure sheds new light on an old problem of the information age: What should people do once their sensitive personal data has been exposed to the world?

This is a problem that is becoming more and more urgent.

Last year, 3,205 data compromises were publicly reported, according to the Identity Theft Resource Center. This is easily a new record, beating 2021, when 1,860 compromises were publicly disclosed, according to the nonprofit.

Here’s what consumers can do, instead of waiting for a notice that their information may have been exposed – or worse.

What is credit monitoring and when should you use it?

As the name suggests, this is an approach for people to monitor what is happening with their credit reports. This is “passive monitoring of activity on your credit reports that indicates fraud, such as new inquiries or newly opened accounts,” Ulzheimer said.

To do this effectively, Ulzheimer said a person needs to keep tabs on what is being reported or researched from the big three credit reporting companies, Equifax EFX, TransUnion TRU and Experian EXPGY.

Still, “monitoring is reactive and only notifies you after something has already happened,” he said. There’s nothing wrong with credit monitoring, but it can only accomplish so much on its own, Ulzheimer said.

“This won’t prevent you from being impacted, it will just warn you,” Dwyer said.

People can pay for credit monitoring and some services can cost around $15 a month, according to the Consumer Financial Protection Bureau.

If someone wants to check their own credit report for free, they can get a free copy every week of the three major news organizations, according to the Federal Trade Commission.

What is a credit freeze and when should you use it?

Freezing a credit report means you can’t open a new credit account while it’s in effect, the Federal Trade Commission said. The move also weeds out fraudsters who attempt to leverage lines of credit in a consumer’s name.

“You should unfreeze or ‘unfreeze’ your credit reports when you legitimately apply for credit,” Ulzheimer said.

The gel stays in place until the person lifts it. There is no fee to freeze a credit report, but a consumer must contact Equifax, TransUnion and Experian to freeze their report at all three companies. All three should be contacted independently.

People who want to block outside access to their credit report may also hear about a “credit lock.” It’s a similar idea, but may require a paid subscription depending on the credit reporting company.

Credit freezes are free, thanks to Fair Credit Reporting Act of 2018.

But how long does it take to unfreeze a frozen account if someone needs credit to make a large purchase? When Dwyer unfrozen his reports, the turnaround was “almost immediate,” he said.

An online freeze request takes up to an hour to process, TransUnion said. A request by phone or mail requires up to three days, the company said.

What are fraud alerts and how to use them?

AT&T said it “encourages customers to remain vigilant by monitoring account activity and credit reports” and that one way to do that is through fraud. alerts. To set up fraud alerts, a consumer must contact the three major credit reporting agencies: Equifax, TransUnion And Experienced – separately.

With a fraud alert, a potential lender must authenticate your identity before granting a line of credit. In other words, it must verify that the consumer is indeed the person who is actually requesting the credit.

A fraud alert falls somewhere between monitoring and freezing your credit, according to Ulzheimer. A fraud alert requires a lender to verify the authenticity of an application before it is approved.

“Fraud alerts set in one credit bureau are shared with the other two, which provides a bit of efficiency that doesn’t exist with freezing or monitoring,” he noted.

Dwyer’s problem with fraud alerts has to do with lenders’ efforts to notify consumers that someone is trying to access credit in their name. “I don’t know how rigorous the vetting process is,” he said. For Dwyer, freezing credit is a more effective option.

Fraud alerts are free and valid for one year. They must be renewed after one year, according to the FTC.

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