Everyone knows a mosquito bite doesn't really start itching until the damage has already been done, and the same goes for many kinds of identity-related crimes. With news of the recent Equifax breach continuing to surface, what do you need to know now to limit your exposure?
Equifax has estimated the hack impacts 143 million people, mostly in the United States. (That's almost half the US population!) The thieves stole names, Social Security numbers, birth dates, addresses, and driver's license numbers.
Each item of personally identifiable information (PII) is like an ingredient for a recipe. The more ingredients you have, the more recipes you can prepare. Similarly, the more pieces of PII exposed, the more kinds of fraud thieves can commit. If there were a fraud equivalent of The Joy of Cooking, thieves just got access to all the ingredients necessary to make every recipe in the book.
The Problem with Freezing Your Credit Report
The New York Times reported still more bad news in the wake of the Equifax announcement.
The credit freeze service the credit bureau offered (originally offered for a fee until it finally decided to provide it for free for 30 days) generated PINs that were based on the time and date the PIN was created. These PINs are required to release the freeze whenever you need to grant access to your credit files in connection with a loan, an apartment rental, or a job application (where permitted by law). Unfortunately, they're laughably easy for a hacker to guess before then.
The bigger problem is that a freeze needs to be in place at all three reporting agencies in order to be effective. As credit expert John Ulzheimer told the New York Times, putting a freeze on your credit with only one reporting agency is "like locking one of three doors in your house and leaving the other two unlocked. You're hoping the thief stumbles on the locked door."
Types of Fraud to Be Aware Of
The hackers also made off with 209,000 credit card numbers and 182,000 credit dispute documents containing personally identifying information.
In August, there was a spike in credit card fraud, according to the New York Post. It seemed odd to security experts at first, since credit card fraud typically increases around the holidays. The Equifax news seems to provide an explanation for the statistical oddity. "We saw a 15% increase in the overall fraud attempts in our system in August, which is an unusual time of year to see such a spike," said Liron Damri, cofounder of Forter, a fraud-prevention service for online retailers.
But the threat goes way beyond maxed-out credit cards, fraudulent credit applications, and tax-refund fraud. With Department of Motor Vehicle information also in play, the risks are elevated. A fake ID made out in your name could cause you to get arrested for an outstanding warrant. In the realm of identity-related fraud products, a fake driver's license is a luxury item for sure, but it's still one that could hurt you if a scammer provides your information on a fake license the next time they're pulled over for speeding or collared for a crime.
And then there's the serious risk of medical-identity fraud. Consumers could see delays in prescription fulfillment because of fraudsters using their health care information. Worse, consumers may not be covered for health care expenses until they are able to prove they are who they claim to be using the same information that the crooks used—a frustrating and often complicated process.
One can only assume there will be lawsuits galore. In fact, one enterprising person has already automated the process. A robot lawyer is on the case, allowing consumers to automatically file a claim against Equifax in small claims court.
According to the Verge, consumers are still able to join class action suits while pursuing a small claims court remedy.
"Even if you want to be part of the class action lawsuit against Equifax," the Verge reported, "you can still sue Equifax for negligence in small claims court using the DoNotPay bot and demand maximum damages. Maximum damages range between $2,500 in states like Rhode Island and Kentucky to $25,000 in Tennessee."
Protecting Yourself Now
To say that the Equifax PIN assignment process was incompetent is an understatement. Nevertheless, it is a teachable moment. While it's okay to hope that your services and vendors will do things right, you need to stay vigilant. And this should go without saying: if you can change privacy and authentication settings on a product or service, do it. If that's not possible, perhaps you should consider finding a new vendor or service.
The easiest way to protect yourself, in my opinion, is by using a system called the "Three Ms." The Three Ms is the centerpiece of my book, Swiped: How to Protect Yourself in a World Full of Scammers, Phishers and Identity Thieves, and the approach continues to be the best way to keep your personally identifiable information from being used in identity-related crimes.
And they are simple:
- Minimize your exposure. Don't authenticate yourself to anyone unless you are in control of the interaction, don't oversshare on social media, be a good steward of your passwords, safeguard any documents that can be used to hijack your identity, and freeze your credit.
- Monitor your accounts. Check your credit report religiously, keep track of your credit score, and review major accounts daily if possible. (You can check your credit report for free at Credit.com.) 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 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.
Your Chances of "Getting Got"
Scammers pay around $30 per complete ID dossier on the black market. With 143 million packets available through the Equifax breach, that's more than 4 billion dollars' worth of information. Though it may not seem so at first glance, this could actually be good news for you: your chances of "getting got" decrease with an increase in available targets.
Odds aside, though, Equifax is not the first, nor will it be the last, breach of note. Being prepared and alert is still the best remedy, because breaches have become the third certainty in life—right behind death and taxes.
A final tip: check with your insurance company, financial services institution, or employer. You may already have access to identity protection and resolution services, which is your best bet when it comes time to navigate the identity theft quagmire.