Safety and Security

Credit Freezes Cost Consumers $4.1B

The Equifax hack continues to hit those impacted, with new research finding that consumers will have to shell out a collective $4.1 billion to freeze their credit reports and prevent fraudsters from using their leaked personal information.

According to CNBC, the report by advocacy group U.S. PIRG shows that with only eight U.S. states requiring credit freezes to be offered free of charge, about 158 million consumers between ages 18 and 65 will face a hefty tab to protect themselves.

The Equifax hack impacted 145.5 million consumers, as well as 209,000 credit card account numbers.

“Consumers can’t control access to their own credit reports without paying a fee, which is outrageous,” said Mike Litt, consumer advocate for U.S. PIRG. “We’re not customers” of the credit reporting firms, he added. “We don’t get to choose them collecting and selling our information – and, in the case of Equifax, losing it – and we have to pay a fee to protect it?”

Several bills are going before Congress that would make credit freezes free in all states, although there’s doubt about whether they will gain any momentum with only Democratic backers in a Republican-controlled Congress.

Equifax’s former CEO Richard Smith, who retired last week, is also slated to be grilled about the cybercrime on Capitol Hill on Tuesday.

Information exposed in the data breach, which Equifax said was discovered July 29, included names, birthdates, Social Security numbers addresses and some drivers’ license numbers.

Experts say all consumers should assume their information was compromised, so millions will likely be looking into freezing their credit reports. This means that if a scammer tries to take out a loan or establish credit using your personal information, the lender can’t check your credit score or history and generally won’t approve the application.

Credit freezes cost anywhere from $2 to $10 in the states where freeze fees are charged. In some states, you’ll also pay a fee to unfreeze your report when you’re applying for a loan.

While Equifax is offering all consumers free credit monitoring for a year, which includes free freezes, fees will still apply for the other two major credit reporting firms, TransUnion and Experian.

Litt said his group is working on activating legislation to remove all fees, something that lawmakers of all stripes can support.

“Of all the things that need to be worked on [related to credit firms], this is one idea for which there should be overwhelming bipartisan support,” Litt said.


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Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out the February 2019 PYMNTS Digital Fraud Tracker Report


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