Should you trust your bank when it tries to sell you its identity theft prevention services? Or is there something here that doesn't quite make sense to you. Is it possible that you don't really need to pay for the kind of protection they offer you if you shop elsewhere? In fact, look at the forums, and you find that consumers have plenty of complaints against the identity theft prevention services they buy from their banks. And the regulators are not happy with them either - as they begin to challenge the banks on how effective their products are.
Go to any website these days and the banner ads are all about how Bank of America or Morgan Chase or Citibank wants you to buy their identity theft prevention package. They are going all out marketing their plans. If it isn't advertising on websites, it's when you stand in line when you visit your local branch. Or there are flyers in your mail. What they charge you is about $10 a month - about the same as what you pay for third-party services like ID Patrol and LifeLock. Citi offers you your first month nearly free and charges you normal fees after that.
So what exactly do they do for the money they charge you? To begin with, they monitor your credit to find out if there is any kind of change to your credit score day-to-day; and they try to check to see if there are any new bank accounts, credit cards or loan applications that have come up against your name. If anyone out there is trying to use your name or your financial information to apply for a loan or a credit card or something, they promise to alert you right away. They will monitor all the chat rooms that they believe data theft fraudsters use to buy and sell information. And they'll send you an alert.
There is a reason that the banks very eager to sign people up to these services - they've really been stung by the new consumer friendly laws that have come about that make it difficult for them to charge you a reasonable fee for services you don't want. They need to sell you new services to make up for the money they've lost. The problem with buying these services is that they are unregulated. There is no one actually checking to see if they really offer you value for your money. There is no one checking to see if they do a good job. What kind of problems are expected?
To begin with, these banks don't actually provide you with the services themselves. They outsource to other companies. And these companies usually have truly awful customer service records. And they have lawsuits pending against them. These are the kind of services that the banks are happy to sell you for your $10. And anyway, the protection they sell you doesn't usually keep you safe from Social Security number fraud or medical identity theft. That's how most people get blindsided.
Anyway, you can always apply with the credit bureaus to be alerted if there is unusual activity. And it's free.
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