It was bound to happen sooner or later, Todd Davis (of LifeLock) is being sued by dissatisfied customers. Why? Because no one can really prevent identity theft.
At least not with the 100% guarantee that customers (justly) expect.
They’re suing Davis for representing the product as safe when he’s actually had someone successfully steal his identity at a payday loan company (because he gives out his SSN). So apparently the product doesn’t work…or so they say.
The suit also notes that the incident with the payday loan company is the only successful theft we know about but there may have been others which simply haven’t come to light yet. Even Davis admits that drivers licenses may have been issued in his name, simply because they don’t use to credit checks the way most SSN uses do. So people could be pretending to be him without actually damaging his credit score. Not as bad, perhaps, but not comforting either.
Is LifeLock worthless? I don’t know. It seems like one way of monitoring your credit activity. And if you don’t give out your social security number (like he did) you’re probably a bit safer.
But I don’t know if it’s really any better than your average credit monitoring service.
If you’re concerned about having your identity stolen and don’t plan to take out any loans or open new credit cards, there’s something you can do for much less than buying the LifeLock plan.
Contact each of the bureaus: Experian, TransUnion, and Equifax and have them put freezes on your credit. Each costs $10 to place and $10 to remove. So that’s $30 to totally freeze and $30 to totally remove. It should keep people from taking out any loans or opening any cards using your information. Even if you keep it frozen for only 7 months it’s still cheaper than LifeLock.
Plus, you can make the same fraud alerts that LifeLock does for free if you really think your identity has been compromised. Each of the credit bureaus has instructions on its site for how to contact them about that.
Then you can use annualcreditreport.com to get a free annual credit report from each bureau. Most suggest spacing them out to every 4 months from a different group, that way you’re always fairly on top of it. And you still only get one per company per year.
So why not try your own LifeLock instead?
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The CNN article notes that LifeLock is also being sued in Arizona over a guarantee which apparently only covers a particular error and not any other identity theft as well as in California by Experian (the credit bureau) who claims that they’re misusing fraud alerts by placing them for all customers instead of for those who genuinely may have had their identity stolen.
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right on!
Too bad you can’t monetize common sense, Mrs. M–you’d be rich by now!
I’ve always been worried about LifeLock… it seemed really expensive for a product like that and really scam like. This doesn’t surprise me at all.
I’ve been using Zander insurance simply because they assign someone to you if you experience theft and refund costs associated with it (lawyers etc). I know someone who had their ID Stolen (my uncle) and he said Zander was one of the best things he had at the time.
“Plus, you can make the same fraud alerts that LifeLock does for free if you really think your identity has been compromised. Each of the credit bureaus has instructions on its site for how to contact them about that.”
Absolutely true. My husband did that when a fraudulent account was opened in his name a few years ago.
I pay for it – at $9 a month it costs $108 a year. Just to lock and unlock your reports in one year cost $60, so it’s not much more, really. Plus, I don’t have to think about it at all. 🙂
Great post. I was a believer in the concept (who could argue against a guy who publicly announced his SSN with a megaphone in some big city?), but when I heard about the litigation, I took down all my ads and put a disclaimer on the 2 or 3 posts where I had mentioned the company.
I did comment, however, when posting about the virtues of the company that a person could do for free all of the things LifeLock did for a fee. It seemed to be a matter of convenience.
Guess we won’t be seeing anymore of those commercials?
I was always suspicious of them. No, you can’t guarantee complete protection from identify theft… especially if you go around announcing your SS# to all the world! 😉
Everything that lifelock does can be done by the consumer for free including putting fraud security alerts on each credit bureau, as well at opting out of pre-screened credit and insurance offers.
Also, consider that LifeLock co-founder Robert Maynard, Jr. resigned from his position after an articles published by the Phoenix Times disclosed his past bankruptcies as well as an incident that he may have stolen his own fathers identity to obtain an American Express Card.
According to Todd Davis, Maynard still maintains a 10% stake with the company and “consults” for the business from time to time.
I’m not putting my identity protection anywhere near these guys!!
I have found these extravagant claims in ads suspicious. Like David of MyTwoDollars above, I pay about $10 a month for a monitoring service from my bank. It also allows me to look at all three of my credit reports at any time for no extra charge. If I didn’t have the discretionary spending money for this in my budget, I would take the other advise given here about managing it yourself. It sounds about as good and is cheaper while more work. We know that being frugal is work. I wish we knew how to monitor other uses of our SSN. There are still too many copies on mine on my medical records since the Health Insurance companies used to use it as the ID number and the doctors’ offices have yet to remove it from their records. In once case, I refused to fill out that required field on one form and later in the appointment found that they had filled it in from their records. A hangover from the days before so much fraud!
The other Lifelock feature that you can do for yourself is opting out of pre-screened credit card and insurance offers.
http://www.optoutprescreen.com is the site the FTC recommends for that.
@Mike, excellent point thanks for mentioning that. I used that for myself, but I should get Micah to do it as well, since he’s been getting a lot of offers lately.
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