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AUSTIN-- A new federal law eliminates fees for getting and removing credit freezes in Texas and across the country at the three nationwide credit bureaus on September 21st. The consumer advocacy group TexPIRG recommends getting credit freezes, not the similar locks offered by the bureaus, to prevent new account identity theft.
In 2003, TexPIRG led the effort in the Texas legislature to pass one of the nation's first laws creating security freezes. However, the law required consumers to pay $10 per freeze per credit bureau, for a total of $30. In the 2017 Equifax data breach, Attorney General Ken Paxton says that 12 million Texans had their information stolen.
"It’s about time the credit bureaus stopped charging us for the right to control our own information. We didn’t give them permission to collect or sell our information in the first place," said Bay Scoggin, TexPIRG’s State Director
TexPIRG points out the following consumer tips about credit freezes:
- By freezing access to your credit reports, you’re stopping identity thieves who apply for new accounts in your name using your stolen Social Security number. The new law also lets guardians create and freeze credit files for minors.
- Because creditors run credit checks with any one or a combination of the three big credit bureaus, you need to block access to your reports with each of the three individually. Getting a freeze with one bureau but not the others is like locking your front door but leaving your garage and back door wide open.
- You can place freezes online with Equifax, Experian, and TransUnion. You can place them by mail or by phone.
- You can easily temporarily lift a freeze when you want to apply for new credit, or permanently remove a freeze.
- Each bureau will give you a PIN with your credit freeze. You will use this PIN when you want to lift a freeze to apply for new credit.
- If you are applying for credit, try to find out which credit bureau the business uses to check credit reports. You can save some time by only lifting your freeze for that credit bureau.
- Make sure to account for the time it can take to lift a freeze. In most cases, if you request a lift online or over the phone, your report can be unfrozen within minutes (legally, it has to be done within an hour.) It can take longer if you don’t have your PIN, so make sure to keep your PIN in a safe, memorable place where you can quickly retrieve it when needed. If you request a freeze via U.S. mail, it can take up to three days after the bureau receives your request.
- Some news outlets have reported that cell phone companies have opened fraudulent accounts using credit reports provided by the National Consumer Telecom & Utilities Exchange (NCTUE). We therefore also recommend freezing your credit report at NCTUE.
- The credit bureaus offer a similar (but different) product called a credit lock. Credit freezes are a right mandated by law. Companies don’t get to set conditional terms on freezes, like they can on credit locks. For example, if you sign up for free credit locks with Equifax and TransUnion, they can use your information for marketing purposes and share it with other financial companies that want to sell you something. TransUnion makes you agree to an arbitration clause.
In addition to recommending credit freezes, TexPIRG offers tips, explained further in its recent report to help consumers prevent and detect other types of identity theft and fraud:
● Existing Account Fraud: Check your monthly credit card and bank statements.
● Tax Refund Fraud: File your taxes as soon as possible, before thieves do. Also, if you qualify, get an Identity Protection (IP) PIN.
● Social Security Benefits Fraud: Sign up for your “my Social Security” (MySSA) account before thieves claim it and change your direct deposit info to route into their checking accounts.
● Health Care Services / Medical Benefits Fraud: Sign up for online accounts with your health care and insurance providers to periodically check for any fraudulent services on your statements.
● Other Fraudulent Activity: Check your free annual consumer reports with companies that specialize in collecting information often misused by criminals.
● Phishing Scams: Ignore requests for personal information by email, links, phone calls, etc.
“The threat of identity theft is unfortunately all too real. But you can take steps to prevent and detect different types,” said Scoggin. “Start with credit freezes if you don’t have them already. You should get your free credit freezes today, because each day that goes by is another day an identity thief could open accounts and rack up a ton of debt in your name.”
The Texas Public Interest Research Group (TexPIRG) Education Fund is an independent, non-partisan group that works for consumers and the public interest. Through research, public education and outreach, we serve as counterweights to the influence of powerful special interests that threaten our health, safety, or well-being.
Your donation supports TexPIRG's work to stand up for consumers on the issues that matter, especially when powerful interests are blocking progress.