By LANA CLIFTON
Identity theft is a growing concern all across America. According to a document released by the Federal Trade Commission in February of 2009, over 313,000 complaints of identity theft were recorded by the Consumer Sentinel Network. These numbers were up from just under 260,000 complaints in 2007 and showed a huge increase since 2000 when only 31,140 were filed. Twenty-four percent of the 2008 complaints were due to suspects opening new credit accounts or loans fraudulently or committing other fraudulent credit card actions.
Dawn Creekmore, Arkansas State Representative for District 27, decided something should be done to allow consumers to protect themselves against such fraud. She decided a law should be on the books in Arkansas to make it possible for consumers to freeze credit history information until they were ready to access it for legitimate reasons.[more]
Her first attempt to pass a bill for this purpose ended in a veto by the governor. She did not let that stop her, however. She reworked and resubmitted the bill. In February, 2009, the bill became Act 223 after passing through the state congress and receiving Governor Mike Beebe’s blessing.
Under the act, Arkansas consumers may contact the three credit bureaus, TransUnion, Equifax and Experian, pay $5 to each bureau and freeze credit histories until they contact them again to have them released. The service is free for seniors.
“If you qualify for AARP, it’s free,” said Creekmore.
Previously, the credit bureaus were charging $10 a piece for a similar service, and there was no guarantee the rate wouldn’t change. There were no rules for Arkansas until the bill was passed. Now, the fee is locked in at $5, and Arkansas is able to set the rules for how the system works for Arkansans.
Creekmore said it was important to her that senior citizens should be allowed to take advantage of this service for free. “Our elderly are huge targets,” she said.
Creekmore said children were having their identities stolen as well. Since Social Security numbers are issued almost as soon as a baby is born, and few people check the credit histories on their children, this kind of identity theft may go undetected for a long time. With a security freeze, parents can freeze their childrens’s credit histories until they are adults, making it much more difficult for someone to commit this type of fraud.
Anyone who wants to freeze his or her credit history should go to each of the credit bureau’s web-sites individually to do so. At www.TransUnion.com, scroll down to the bottom of the home page and look for and click on the words “security freeze” under the identity theft category. At www.Equifax.com, click on, “request a security freeze.” At www.Experian.com, click on, “security freeze,” located at the bottom of the home page under “Notices.” From there, follow the directions. According to Creekmore, at some point the directions will ask for a state. After choosing Arkansas, the rest of the requirements will follow the rules set up by the new legislation. Part of the process will include setting up a Personal Identification Number (PIN). The PIN will be the key for lifting the freeze. It will be the only way someone can access the credit history to apply for credit.
After a consumer has frozen his or her credit history, most of the time business will go on as usual. The freeze will not apply to legitimate every day uses of credit history such as reviews done by employers or the credit card companies with which a person holds accounts. Court orders, collection agencies, background checks and other similar activities will also be conducted without interruption.
“We’re not trying to slow down or interrupt business as usual,” assured Creekmore.
However, if someone is going to apply for any type of credit, whether it is for a car loan or credit card or to buy furniture, and if his or her credit history is frozen, the freeze will need to be lifted first. To lift a freeze temporarily, the consumer will call all three credit bureaus with a PIN.
According to Creekmore, the bureaus will only take about 15 minutes to lift the freeze, and there will be a two-hour window allowing the potential creditor to do the credit check needed for approval, then the freeze will go back into effect. There will be a $5 fee with each bureau each time a freeze is temporarily lifted. To keep from paying $15 each time, Creekmore said another option would be to find out which credit bureau the creditor would call and to only have the freeze lifted with that bureau.
All of the steps to set up a security freeze and lift it can also be conducted by phone, website or by mail. Each credit bureau has contact information listed on its website.
