Debunking the case against LifeLock

Posted by Joe on May 29th, 2008

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Todd Davis, the CEO of identity theft protection service LifeLock, appeared on the nationally televised Today Show last Friday to publicly address a handful of recent lawsuits against the company. Given that we have gone on the record stating LifeLock is the best overall value in identity theft protection, we thought we would take the opportunity to address three common criticisms we hear from LifeLock’s detractors by researching and presenting the facts to our readers.

Common Criticism #1: LifeLock charges consumers for services that they can get for free.

Some of the identity theft protection tools that LifeLock uses are freely available to consumers. In particular, LifeLock’s critics like to point out that anyone can set their own fraud alerts or order their free annual credit report from the three major credit bureaus. There are two points to address here.

First, while it is true that consumers can set their own fraud alerts, for example, that doesn’t mean that it is a trivial process. We encourage anyone that is not familiar with the process of setting a fraud alert to read our fraud alert and credit freeze guide.

LifeLock is very upfront about the specific services they provide and which of those that can be done for free by consumers. The analogy that Davis has publicly used in the past is that LifeLock is a service provider and no different than paying someone to change your oil instead of doing it yourself.

Second, these are not the only services that LifeLock provides to its subscribers. LifeLock offers an number of features that help prevent and detect identity theft crimes and help victims recover. For example, LifeLock’s eRecon service scours the Internet looking for improper or criminal uses of their subscribers’ personal information such as credit card numbers. WalletLock, a LifeLock service that replaces all of an individuals documents such as credit cards, driver’s license, Social Security card, credit cards and passport, is also available to every LifeLock subscriber.

It is clear that LifeLock does provide many useful services that would not be available to consumers without incurring some cost in time and/or money. Ultimately, LifeLock provides a service for consumers that want the peace of mind that comes with having a team of experts protect and, if needed, recover their identity for them.

Common Criticism #2: LifeLock can’t be effective at identity theft protection because many subscribers, including their CEO, have been victimized by identity theft.

It is true that LifeLock subscribers, including the company’s CEO Todd Davis, have been victimized by identity thieves. However, publicly available data shows that LifeLock subscribers are nearly 400 times LESS LIKELY to be victimized by identity theft than non-subscribers.

In the interview with the Today Show’s Matt Lauer, Davis reveals that 105 of LifeLock’s subscribers have been victimized by identity theft. That means that approximately 0.01% of LifeLock subscribers, or about one in every 9,524 subscribers, have been victimized. Now, compare that with recent statistics published by the Better Business Bureau which found that 4%, or one in every 25, American adults had been victimized by identity theft in 2006, the most recent statistics that were available. Again, this means that LifeLock subscribers are almost 400 times less likely to fall victim to identity thieves than the average American adult.

In Davis’ case, a Texas man took out a $500 payday loan in the LifeLock CEO’s name using the Social Security number that is featured prominently in the company’s marketing campaigns. Since the payday loan company did run a credit check on the loan request, the fraud alerts on Davis’ credit report were not triggered and the transaction could not be prevented. To be clear, there is no identity theft protection service on the market today that could have prevented this identity theft incident from occurring. However, LifeLock’s recovery services immediately went into effect and Davis’ identity was recovered without costing him any time or money.

Davis has publicly commented on the incident many times and has been clear that there was no lasting impact on his identity or credit file as a result. “There’s nothing on my actual credit report about uncollected funds, no outstanding tickets or warrants or anything,” he said.

While it would be better if no LifeLock subscriber was ever victimized by identity theft, the reality is that no identity theft protection service can be 100% effective. The goal of these services is to minimize the chanced of identity theft as much as possible, and we’d say minimizing your odds of being a victim 400 times is awfully effective. Plus, identity theft protection is only one facet of the company’s service. LifeLock also offers a $1 million service guarantee which pays to recover the identity of any subscriber that is victimized while a member of LifeLock. We will address the critic’s view of the $1 million guarantee below.

Common Criticism #3: LifeLock’s “$1 Million Service Guarantee” isn’t worth the paper its printed on.

LifeLock’s $1 million guarantee is a straightforward contract between LifeLock and its subscribers in which they commit to spending up to $1 million to recover the identity of any subscriber that falls victim to identity thieves. This does not mean that LifeLock writes a check in the amount of $1 million to any subscriber whose identity is stolen. But, it does mean that LifeLock will provide victims with access to experts and professionals will work to recover the victim’s identity on LifeLock’s dime. The guarantee is easy to read and understand and is prominently published on LifeLock’s website.

All of the 105 LifeLock subscribers that have fallen victim to identity theft to date, including Davis himself, were covered by the company’s service guarantee. “What’s important is the whole incident proves that LifeLock works, because I was never out a dime of my own money or a minute of my own time,” Davis said. “LifeLock protected me and the other 104 members exactly as they promised.”

As always, we encourage consumers to develop their own opinion based off of the facts at hand. You can view Davis’ Today Show interview below.

To learn more about LifeLock or other identity theft protection services visit our identity theft protection service comparison and reviews.

• Reader Question: How can LifeLock help me if I have already been a victim of identity theft?
• LifeLock CEO to answer questions and address criticisms in town hall meeting this Friday
• LifeLock’s $1 Million Guarantee - Separating Fact From Fiction
• LifeLock CEO addresses lawsuits and critics head on
• LifeLock… Now with frequent flier protection!

Identity Truth Launches toll free number for NextAdvisor.com readers

Posted by Joe on May 28th, 2008

Identity Truth has launched a dedicated 800 number for visitors to NextAdvisor.com that will allow consumers to sign up for the identity theft protection service over the phone. This is in addition to the existing website based sign up process that can be found here.

The toll free number is (866) 736-0165 and is staffed by live Identity Truth representatives Monday through Friday from 8am to 6pm EST. If you call outside of these hours you may leave a message and you will be contacted the next business day.

This new toll free phone number gives you the opportunity to interact directly with qualified Identity Truth representatives who can answer any questions you may have about their service. We applaud Identity Truth for taking this proactive measure to give NextAdvisor.com visitors an phone based resource.

Identity Truth is a relatively new identity theft protection service, but our review of the product found that they really differentiate themselves with their innovative use of technology. There are three areas in particular that we thought were particularly useful for consumers:

1) Identity Truth subscribers have access to a very slick online interface that gives detailed instructions on how to set their own fraud alerts with each of the three major credit bureaus. This hands on approach is slightly different than LifeLock’s managed fraud alert feature, but will likely be attractive to consumers with a do-it-yourself streak who want to be more actively involved with the protection of their identity.

2) Identity Truth has an extensive, searchable database of data breaches of all sizes. They send email alerts to their subscribers to notify them of new breaches as they are made public. This is important as it allows consumers to have visibility into potential threats to their identity caused by data breaches at major corporations, financial institutions, educational institutions or anywhere were personal information is stored by a third party.

3) Identity Truth has an automated tool which monitors your personal information, such as your name, social security number, phone numbers, bank or credit account numbers, across the Internet to ensure that no suspicious activity is occurring in your name. Since personal information is routinely bought and sold on the Internet by criminals everyday, we believe that this is an important feature which has inspired other services, such as LifeLock’s eRecon, to take similar measures to protect consumers.

To learn more, visit our in-depth review of Identity Truth or call the dedicated toll free number at (866) 736-0165.

• NextAdvisor reviews Identity Truth
• LifeLock CEO to answer questions and address criticisms in town hall meeting this Friday
• Identity Theft Shield from Kroll and Pre-Paid Legal Review
• Is your state putting your identity at risk?
• Debunking the case against LifeLock

Netflix streaming set top box review

Posted by Joe on May 21st, 2008

Netflix announced the launch of a new streaming video player that will allow subscribers to view over 10,000 movies and televisions shows on demand over the Internet. The set top box is powered by Roku and will retail for about $99 when it is released later this year.

Since we have yet to test the new Netflix streaming movie service ourselves we have put together a sampling of feedback from trusted sources across the web as a service to our readers.

From Wired’s Mark McClusky:

WIRED Textbook definition of a simple setup. Good video quality from streams. Box automatically upgrades as new software features become available. No cost above normal Netflix subscription.

TIRED Another nondescript black box to clutter up your living room. Just not as much content as we wish was available. Box and remote, while functional, just aren’t very good looking.

From The New York Times’ Saul Hansell:

You can show your non-techie friends the Roku Netflix Player, and they’ll get it right away. Unlike most version 1.0 products, you won’t have to keep making excuses for delays, awkwardness and various bugs. The box does what it says it does well and doesn’t promise to do anything else. In my tests, it was easy to use, responsive, with good video quality. (Disclosure: I didn’t stress it. I have a fast Internet connection and an old small TV that is gentle on fuzzy pictures.)

The product right now isn’t for everybody. If you don’t want old movies or don’t want a $9-a-month subscription, it is clearly not for you. But if you like that deal, you’ll like the box.

From CNET’s John P. Falcone:

Those looking for the HD video quality and polished interface of Apple TV and Vudu will be disappointed. The Netflix Player is strictly barebones–you’re not intended to do anything more than just dive in and watch the movies and TV shows you’ve already queued up via your online Netflix account. The biggest drawback–for now at least–is the dearth of quality content. Thanks to Hollywood’s byzantine licensing system, less than 10 percent of Netflix’s 100,000-plus library of titles is available for streaming to the Player. That means, for now, that only two of Netflix’s top 100 DVDs are available for streaming: March of the Penguins and Eternal Sunshine of the Spotless Mind.

That said, the Netflix Player has a major trump card in terms of price: it retails for $100, and delivers unlimited streaming to any Netflix subscriber on the $8.95 plan or above. That’s a major departure from Apple TV, Vudu, Xbox Live Marketplace, and Amazon Unbox, all of which offer only pay-per-view options, including download-to-own videos and rentals with tight viewing windows (e.g. rental titles must be completely viewed within 24 hours).

From the Associated Press’ Peter Svensson:

For me, the low price was an effective dose of Gold Bond powder on this irritation. Starting a movie takes up to a minute? Yes, but hey, it’s cheap! The picture quality varies a great deal, and there’s no HD? Yes, but you can’t expect the world for $8.99 a month.

Roku’s box is just the first of what Netflix hopes is a whole family of products that get movies from its Web site. LG Electronics is planning to include the streaming capability in a Blu-ray DVD player later this year, and two other unnamed manufacturers are bringing out set-top boxes.

But I don’t see a big reason to wait for them. Even if the Roku player sacrifices a few things to limbo under the $100 price level, it’s a no-brainer for the 8 million-plus Netflix customers out there. If you’re not one, this is an added reason to become one.

From the Washington Post/TechCrunch’s John Biggs:

The Netflix Player by Roku is the first in what portends to be a long line of devices designed to download and stream movies from Netflix. While in its current incarnation the device is fairly limited, I can firmly recommend it with the expectation that the movie selection will improve.

You can learn more about online dvd rental services by visiting our online dvd rental service reviews and comparison.

Update: Thanks to Laurie Boeder at the About.com Classic Movies Blog who points out that the new Netflix set-top box will likely be a convenient option for classic film buffs as well.

• Netflix continues to innovate, explores movie streaming over Xbox Live
• NetFlix beats Apple to the unlimited download punch
• Netflix to invest in expanding Blu-ray movie inventory
• Our review of Apple’s new movie download service - Stick with NetFlix!
• Blockbuster to increase prices by as much as 40%

1 million credit scores lowered by Sallie Mae

Posted by Joe on May 15th, 2008

The largest provider of student loans in the United States, Sallie Mae, made a critical reporting error which artificially lowered the Equifax credit scores of approximately one million borrowers.

Like all lenders Sallie Mae reports account history information for all their borrowers to all three of the major credit bureaus including Equifax, Experian and TransUnion. In the most recent data transfer an error caused about 10% of all accounts, or about one million total borrowers, to appear delinquent.

Sallie Mae realized the issue and contacted all three credit bureaus. Equifax had already posted the information the impacted individual’s accounts which immediately lowered their credit scores. Experian or TransUnion scores were not impacted.

The issue has been resolved and the Equifax credit scores have been restored for impacted individuals. Those who believe they may have been impacted are encouraged to contact Sallie Mae directly at 1-888-2-sallie. Sallie Mae will also provide credit references to impacted consuers upon request.

“We certainly and fully understand the importance of one’s credit rating and we worked with urgency to resolve this situation,” Said Sallie Mae spokesman Tom Joyce.

Those consumers that utilize a credit report monitoring service would have received immediate alerts when these changes were posted to their Equifax credit report and score. To learn more about credit report monitoring services we suggest visiting our credit report monitoring service reviews and comparison.

• Equifax offers free 3-in-1 credit report and 3 bureau credit report monitoring
• Reader Question: Which credit report monitoring services provide ongoing credit report and score data?
• Credit piggy backing gets bucked
• Unlimited credit reports and scores from all 3 bureaus with CreditCheck Total
• Keep your credit purring like the engine of your car

Data Breach Alert: Stolen laptop impacts Virginia school employees

Posted by Joe on May 15th, 2008

A laptop containing the the personal information of several Harrisonburg City Schools employees in Virginia was stolen earlier this month. The laptop belonged to BB&T insurance, a company contracted by the school district to administer their dental pan.

It is unclear exactly how many employees have been impacted by the data breach, but it has been confirmed that names, dates of birth, social security numbers and some medical history of school district employees was present on the laptop. A BB&T spokesperson confirmed the presence of the sensitive data on the stolen laptop and added that there are several security methods employed on the laptop to prevent access by criminals including passwords.

Learn more about identity theft protection options by visiting our reviews and comparison of identity theft protection services.

• Data Breach Alert: Stolen laptop exposes identities of 20,000 Kraft employees
• Data Breach Alert: Stolen laptop leaves thousands of Connecticut State students exposed
• Data Breach Alert: Student hacker puts 35,000 teachers and staff on alert
• Researchers launch free tracking software for lost or stolen laptops
• Data Breach Alert: Utah hospital loses thousands of patient records

Data Breach Alert: Thousands of Dominican University students impacted in secure file breach

Posted by Joe on May 15th, 2008

About 5,000 current and former students of Dominican University in Chicago were alerted late last month due that their personal information may have been breached as a result of a digital break-in of secure files by two current students. The school had held off on publicly announcing the breach until now in order to help minimize the overall impact of the breach but all impacted individuals were notified of the identity theft risk immediately.

School officials believe it was an isolated incident and there have been no reports of the compromised data being misused in any way. The school recommended that impacted individuals contact the three major credit bureaus and place fraud alerts on their credit reports. We discussed the difference between fraud alerts and credit freezes in our recent guide to fraud alerts and credit freezes.

Learn more by visiting our guide to identity theft protection services.

• Data Breach Alert: College students receive social security numbers of classmates over email
• Data Breach Alert: Stolen laptop leaves thousands of Connecticut State students exposed
• Data Breach Alert: Thousands of California students at risk for identity theft
• Data Breach Alert: Harvard hack exposed more data than initially thought
• Data Breach Alert: Western Carolina University exposes hundreds of social security numbers

Data Breach Alert: 70,000 impacted in OSU server breach

Posted by Joe on May 14th, 2008

Over 70,000 students, faculty and alumni of the University of Oklahoma are being notified beginning today after the University inadvertently posted their personal information, including social security numbers, on a publicly available website.

All of the impacted individuals had purchased parking and transit passes over the last six years. The breach actually occurred in March. However, the server was shut down as soon as the issue was discovered and, as a result, the personal information was no longer available on the website.

If you believe you may have been victimized by this or other data breaches we suggest you research your identity theft protection options by reading our reviews and comparison of identity theft protection services.

• Data Breach Alert: 60,000 impacted in Ohio data breach
• Data Breach Alert: Harvard hack exposed more data than initially thought
• Data Breach Alert: Registration website exposes presidential primary voters to identity theft
• Data Breach Alert: College students receive social security numbers of classmates over email
• Data Breach Alert: Tens of thousands impacted in Antioch College data breach

Reader Question: Which credit report monitoring services provide ongoing credit report and score data?

Posted by Joe on May 14th, 2008

This is a post in our “Reader Questions” series where we publish actual question from our community. Ask your own question by visiting our contact form.

Q: Which credit report monitoring services provide will provide me with free credit reports and scores beyond the initial free credit report I receive when I sign up?

A: Most of the services we have reviewed offer unlimited access to your credit report from at least one of the credit bureaus.

For example, Equifax with Score Power gives a free 3 bureau credit report when you sign up plus you can view your updated Equifax report as often as you want for as long as you are a member of their service. You can learn more by reading our detail review of Equifax with Score Power.

CreditCheck Total, on the other hand, not only gives you access to a free 3 bureau credit report when you sign up, but also access to all three credit reports and scores any time you want to access them. You can learn more by reading our detailed review of CreditCheck Total.

Deciding which service is right for you really depends on your needs. While CreditCheck Total will give you access to all of your reports and scores, Equifax is the only provider that will give you access to your FICO score which is the credit score most lenders use when they are evaluating your creditworthiness. If having Access to your FICO score is important to you then Equifax is probably your best choice.

Both services have extensive 3 bureau credit monitoring meaning that you will have access to real-time updates anytime there are changes posted to any of your credit reports.

You can learn more by visiting our credit report monitoring service reviews and comparison.

• Equifax offers free 3-in-1 credit report and 3 bureau credit report monitoring
• Unlimited credit reports and scores from all 3 bureaus with CreditCheck Total
• Reader Question: What is the best way to monitor my FICO score
• Reader Question: How do I get my FICO score for free?
• Reader Question: Am I entitled to a free credit report each year?

Data Breach Alert: Theft puts 13,000 Pfizer employees at risk

Posted by Joe on May 12th, 2008

In what is becoming an alarming trend for Pfizer, the multi-national pharmaceutical company, about 13,000 employees have been notified that their personal information is at risk for identity theft after a company laptop and flash drive were stolen last month.

Pfizer has had six separate data breach incidents in the last year which have resulted in over 65,000 data breach notifications being sent to impacted employees and consumers. Those impacted by corporate data breaches should consider an identity theft protection service. Learn more by visiting our identity theft protection service reviews and comparison.

• Data Breach Alert: Stolen laptop exposes identities of 20,000 Kraft employees
• Data Breach Alert: Stolen laptop impacts Virginia school employees
• Data Breach Alert: MTV exposes personal data of 5,000 employees
• Data Breach Alert: Utah hospital loses thousands of patient records
• Data Breach Alert: Tens of thousands impacted in Antioch College data breach

Reader Question: Will my LifeLock or Equifax account also cover my spouse?

Posted by Joe on May 12th, 2008

This is a post in our “Reader Questions” series where we publish actual question from our community. Ask your own question by visiting our contact form.

Q: My wife and I keep all of our financial accounts in both of our names. If I sign up for LifeLock or Equifax will it also cover my spouse?

A: The short answer is that each of these services, LifeLock for identity theft protection and Equifax for credit report monitoring, will only fully cover you and your spouse if both of you are subscribers.

LifeLock makes it very simple for married couples to sign up for their identity theft protection service together since they will allow both of you to register on a single form. You can even sign your kids up for LifeLock’s child identity theft protection (Editor’s note: all parents should read our child identity theft protection guide to learn why they need to protection their kids from identity thieves).

Equifax does not have a shared sign-up form for married couples. However, their registration process can be completely safely and securely online. Once you have signed up you will have immediate online access to your credit report and credit score, including your FICO score which is the score that most lenders use.

We strongly suggest that both you and your spouse sign up for these services individually for full protection and insight. By only covering yourself you will not have any insight into new account identity theft perpetrated against your spouse. Additionally, both you and your wife have you own credit files. The credit bureaus do not combine them when you are married, so you will not have visibility into your wife’s credit report and score if she does not sign up for credit report monitoring in her own name.

• Reader Question: Does signing up for LifeLock cover my spouse?
• Reader Question: How do I get my FICO score for free?
• Reader Question: Which credit report monitoring services provide ongoing credit report and score data?
• Equifax offers free 3-in-1 credit report and 3 bureau credit report monitoring
• Reader Question: How do I order my free credit report?