You have probably heard many of the sordid details of the Equifax breach, ranging from poor security maintainence to executive stock sales. The bottom line is that Regulation E protects consumers against fraud, but that does not preclude the fact that working through personal identity theft is cumbersome and violating.
Lawsuits are starting to pile, however.
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The scenario that personal finance and credit experts feared most about the heist of consumer data from Equifax may already be underway.
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Criminals are using the stolen information to apply for mortgages, credit cards and student loans, they’re tapping into bank debit accounts, filing insurance claims and racking up substantial debts, according to a major new class-action suit.
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The suit pulls together dozens of individual complaints from consumers in all 50 states plus the District of Columbia.
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It seems cybercriminals aren’t wasting time using the Social Security numbers, credit card accounts, driver’s license numbers and other sensitive personal information they siphoned out of the credit bureau’s reputedly secure databases on 145.5 million Americans.
Some claims bring valid concerns, others appear questionable. The fact is that the stolen information is sufficient to apply for new credit. They know your name, your social security number, your date of birth. The credit industry needs to overhaul their legacy Know Your Customer (KYC) program to ensure they Really Know Your Customer.
Some other claims do not make sense. It seems like some customers now claim fradulent charges. Since there were no exposed cardholder accounts, it is unlikely that this would be the case. Still vigilience is in order and there should be no hesitance in reporting questionable charges to the card issuer.
The bottom line is that the Equifax debacle is a mess, and many of the problems are self-imposed. With 145 million affected, it impacts almost the entire US adult population, except, ironically, most of the unbanked market. Consumers should not lose a dime, thanks to zero liability programs and Reg E, but they must be watchful. If your record does get abused, expect to put hours into it.
Overview by Brian Riley, Credit Credit Advisory Service at Mercator Advisory Group
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