Protecting Your Credit in the Wake of a Security Breach

Every time news breaks of a major security breach, we get calls from clients asking how they can protect themselves.

The Equifax breach of 2017 is a great example. What makes this one so egregious is the amount of financial information Equifax collects-- information that was put in danger for 145 million Americans.

Owner-operated businesses are an ideal target for identity theft. As a sole proprietor, the owner and the business are considered one in the same. If there is an identity compromise of either the business or the owner, the implications could affect both the owner’s personal and business accounts. If fraudulent business accounts are established, creditors can pursue collections from the owner personally.

And sometimes owners are so consumed with the day-to-day work of the business that data security is at the bottom of the to-do list. Cyber criminals look for businesses that are poorly defended against fraud attacks.

So what, then, does this mean when a security breach happens and your personal information may be vulnerable?

First, it means you should take precautions to protect your identity from fraud. You can do this with credit and identity monitoring.

Credit monitoring tracks your credit reports and notifies you of any activity. If you see there’s been a new loan application in your name but you didn’t apply, you can then take steps to prevent the fraud from moving forward.

If you decide to purchase a credit monitoring plan, make sure it covers all three credit reporting agencies--Experian, Equifax and TransUnion. Be aware that several services only alert or monitor and do nothing to assist if something happens. Make sure you know that going in. For example, the free service that Equifax offered after the breach is a monitoring-only service.

You can also take the proactive step of freezing your credit at any time. A security freeze prevents someone from using your credit report to open a new line of credit. You can unfreeze your credit if you need to make major purchases in the future. 

Identity monitoring goes a few steps further. It notifies you any time your personal information (Social Security number, bank account information, etc.) is being used in ways that are inconsistent with your past activity. For instance, if someone orders a new utility service using your driver’s license number, you will be alerted.

You may want to rethink your approach to personal identity and security. Identity theft recovery services can help you get your financial life back on track after a breach affects you. We don't hesitate to obtain car insurance, home insurance or medical insurance. We now live in an age where we need identity insurance to help cover some of the associated costs of a security breach, like court fees. Remember that insurance is needed for everyone with a Social Security number, not just heads of households. Consider a service that protects your whole family.

Protecting yourself is always a good idea. Though paid services like the ones above are very helpful, common sense and awareness of how you use your information--especially online--is at the front line of your protection.

The Fraud and Security section of the Pinnacle Learning Center is filled with great articles on how to protect yourself and your business from fraud and identity theft. We encourage you to explore these articles and look into the protection services available to you so that you can have peace of mind in securing your personal information and financial safety.  

Victoria Ragland can be reached by phone at (901) 259-5409 or email at Victoria.Ragland@pnfp.com.