We have been purposefully quiet about the Equifax data breach as a big goal of ours is to always make sure that our emotions are not driving our recommendations or clouding our advice. Clearly, the Equifax data hack has been headline news and difficult to avoid. The main concern for many is that our most detailed and personal credit information is held with the main credit bureaus (Equifax, Transunion, and Experian).
We at PathWise have always made the assumption that your personal data is already out there. Between the many hacks and the inadvertent ways you may have given out personal information without even realizing, it is highly likely (if not certain) that your personal data is already floating around out there and subject to abuse. It’s more a matter of “when” rather than “if.”
Given this situation, it’s understandable that you may be anxious so we want to provide a few suggestions and thoughts around data breaches and protecting yourself. First of all, we want to assure you that here at PathWise we take the utmost precautions to not only keep your information safe and secure but also to use a lot of “common sense.” What we mean is that we will never process a wire or other transaction unless we have directly connected with you in some way and we understand the purpose. The nice part of keeping the firm small is that we get to know everyone on a deep level and alarm bells tend to go off when something out of the ordinary is requested.
In terms of action steps, you can go ahead and take up Equifax on their offer to get free monitoring for a year. When they first announced this, there was concern that after the first year you would automatically have the service extended and get charged for it, but now it appears that won’t be the case. Arek signed up for this service; however, we would like to note that as of the posting of this blog, Arek still has not received the email from Equifax to finish setting up the credit monitoring program. Here is the link: https://www.equifaxsecurity2017.com/enroll/
We also really like Credit Karma at www.creditkarma.com. It’s a free service that lets you see your credit scores, pull your credit reports, and get email alerts when there are changes to your credit reports. Both Arek and Ryan use this service and recommend you sign-up and use it even if you decide to try out the Equifax service being offered.
The “safest,” though the most cumbersome approach is to “freeze” your credit. There is usually a nominal fee for this, though Equifax is currently offering it for free. Once your credit is frozen, no new credit can be obtained under your name/social security number. The disadvantage here is that this means even you can’t open new credit for yourself. So something as simple as getting a new cell phone may be a more involved process as it may require you to go back and “unfreeze” your credit and then freeze it again. So, again, this will be a process.
The final issue that many people miss is that identity theft is being used to file fraudulent tax returns and claim refunds. The IRS has been putting in some safety checks and you will see that new things are getting added often (many states are now requiring driver’s license information and it’s recommended to add it to your return to speed up processing even if it’s not required). Filing early is ideal, but often not possible when we await schedule K-1s and other work and investment related documentation. So, the key, is just to be vigilant. If you have been a victim of ID theft, we can help you fill out some paperwork with the IRS to make them aware of this (it may add some admin/processing steps for you going forward with respect to your taxes). Let us know if it’s something you are interested in doing.