Blame the Chinese.
This week, the Justice Department finally filed charges against the folks responsible for the major security hack on the credit agency Equifax in 2017.
Turns out, it was four members of the Chinese military.
You might remember our coverage of the hack. The hack happened in May of 2017... but Equifax didn't report it until September 2017. Then in February of 2018, it revealed that the hackers got more data than the company originally thought.
These hackers got a hold of all the "keys" needed to steal someone's identity: Names, addresses, Social Security numbers, birth dates, tax ID numbers, e-mail addresses, credit-card information, and more.
Over 145 million Americans had their information exposed.
That's nearly every American with credit history.
It also means your data could have been for sale on the "dark web" for months before Equifax did anything to alert you. The dark web is a part of the Internet that doesn't connect to search engines – you need special credentials or software to access it. It's a hotbed for criminal activity, including black markets for stolen identities.
Even more unsettling – China has cracked down on several data breaches, including a group of Apple employees who stole the customer data and sold it. The market for this data is huge. An updated estimate from cybersecurity company Sixgill found that the number of stolen credit card numbers for sale on the dark web tripled in the last half of 2019.
That's why you need to protect your own credit.
I recently wrote about the importance of checking your FICO score, but you also need to check your credit reports.
Equifax is one of the three main credit bureaus in the U.S. – the other two are Experian and TransUnion. But each one reports on slightly different thing. For instance, your bank might only report to two of the three bureaus, so each one is important to see a full picture of your credit.
Each of the credit bureaus offer a free report once a year. Your credit report will list all open lines of credit and debts – any credit cards, mortgages, and loans should be on there.
You should make it a part of your regular financial checkup to request these reports. That's how you can catch identity theft – you'll see lines of credit or inquiries you didn't authorize. Checking your credit report is an essential way to protect yourself.
You can request all three reports at once or spread them out, depending on what works for you. Get all three at once if you want a full picture of your current credit history, or stagger them every few months for regular monitoring.
Keep in mind that if you have a big purchase coming up like a house or a car, you'll want to get all three to have the full picture of what your credit looks like. That will help with negotiating leases and mortgages.
In the wake of the breach, Equifax launched a new service to help protect your credit called Lock & Alert. It's a simple (and free) way to lock and unlock your Equifax credit report. The service sends you an alert confirm its status... so you'll know if someone is trying to access your information.
We're not entirely sure we want to trust Equifax's service, though, after this massive hack. That's why we're more partial to freezes. The law regulates credit freezes, not the whims of the credit bureaus like locking services do. However, there are also tougher security blocks to freezing and unfreezing your credit...
To put a "security freeze" on your credit, you'll need to call each credit bureau and tell them to freeze your credit. You can also do this online. And as of 2018, credit freezes are free for everyone in the U.S.
Just remember that if you need to apply for a loan or line of credit, rent an apartment, or apply for a job, you'll need to contact each bureau to temporarily lift the freeze on your credit. But don't forget... you'll have to make sure to follow the same steps freeze your credit again.
Credit-card scams, fake phone calls from the IRS, software takedowns of major corporations... there are dozens of ways hackers can get your information. That's why this week's news is so important.
There hasn't been another hack of this scale recently, but don't let that put you at ease. There's certainly going to be another... And you could lose everything.
Take these steps today to secure your credit before it's too late.
What We're Reading...
Here's to our health, wealth, and a great retirement,
Dr. David Eifrig and the Health & Wealth Bulletin Research Team
February 11, 2020